It is important for investors to understand why the financial services industry insists on using mathematical illusions to create a false sense of security among investors. Prior to 1975, brokerage commissions were fixed by law. This allowed established brokerage firms to generate enormous profits on large transactions. Financial planning and fee-based advice did not exist. On May 1, 1975, the Securities Acts Amendments eliminated fixed commissions, allowing for firms such as Charles Schwab to enter the market and drive down commission rates.