Advisor Reveals His True Colors Part 2
“Guarding Your Wealth” is a nationally syndicated weekly personal finance column written by Jeffrey D. Voudrie, CFP. Mr. Voudrie is the President of Legacy Planning Group, a private wealth management firm that employs sophisticated proprietary strategies designed to protect and grow its clients' investments. Please visit our website, www.guardingyourwealth.com to read past articles in our archive.
(PRWEB) June 27, 2005 -- Not all advisors are sales hustlers. I also heard
from someone who made a radical decision in response to his experience in the
financial services industry. Let’s hope that other conscientious advisors don’t
follow his example!
Last week I shared some real-life confessions of a
typical financial advisor. This self-proclaimed “aggressive, 34-year old [sales]
hustler” sells equity-indexed annuities almost exclusively. He can’t resist the
easy money and, even though he knows the investment is better for him than his
clients, he is unwilling to change his ways.
(Florida seniors watch out!
This advisor might be the one trying to sell you that equity-indexed annuity!
Seniors all across the country need to understand that advisors recommending
these high-commission products are very likely cut from the same
cloth.)
I recently received an email from someone I’ll call John. He was
impressed by the information on my website (www.guardingyourwealth.com) and had to tell me his story.
“Thank you for shedding light on the true conflicts involved in the sale of
equity-indexed annuities. Hopefully, this will drive change in legislation.”
Interestingly, I took part in a conference call with the Securities and Exchange
Commission on that topic a week later!
John started his financial
services career in a very unusual way--he actually got a college degree in
finance! You might be shocked to know that few advisors have a formal education
in finance, investments, or other money-related issues. Many don’t even have a
college degree. Their firms focus on teaching them how to sell.
John
started out with a ‘financial planning company’, desiring and expecting to help
people manage their money and achieve their financial goals. He quickly learned
that the firm’s focus was quite different. John says, “I found myself around
people who were just trying to figure out how to make money on a presentation.”
And what well-thought-out investment strategy were his co-workers
presenting? “Most were pushing variable annuities on every deal…and not just for
a small portion of the client’s overall portfolio,” John says. “Needless to say,
I did not feel comfortable and left the company.”
John then decided to
work for a CPA firm that was starting to offer financial planning services to
it’s client’s. He was confident his experience would be different. But once
again, that wasn’t the case. “The owner was introduced to equity-indexed
annuities in San Diego from Allianz. Well, he saw the dollar signs [the
potential he had to make money] and hit the senior market.”
The
opportunity to make a lot of money was too good to pass up and the owner decided
to push these products to seniors. Seniors who came to the CPA firm because they
trusted the CPA subjected to advice that was colored by what was best for the
firm. John recalls, “I looked, examined, and looked again at these contracts and
said something is wrong. Who gets paid a 12% commission and the investor
receives a benefit?” Good question.
“I was really interested in doing
financial planning as a profession but just could not stomach these
experiences.” Unfortunately, John left the financial services industry all
together. There are many people graduating from college that have strong
educational backgrounds in financial planning. All too often their experiences
are similar to John’s and they leave the industry. That’s bad for all
investors.
There are advisors that you can trust. These advisors have
chosen to be paid by fees instead of commissions. As a result, it takes years
for them to earn through annual fees what commission-based advisors make in one
transaction. You only pay them for the period of time you use their services.
They only continue to make money by keeping you happy—what a
concept!
Typically, fee-based advisors don’t hold seminars or contact you
by phone to pitch the latest hot product. Most of the time, you have to seek
them out instead of the other way around. By the way, how often are you
contacted by reputable, experienced accountants or doctors trying to sell their
services? Why should it be different in the financial services
industry?
Do your research anytime an advisor recommends an investment,
especially if that advisor sought you out. Make an informed decision, not a
quick one.
Have a financial question? I’ll personally answer it. Go to www.guardingyourwealth.com and click on ‘Ask Jeff’.
In
addition to being a nationally syndicated columnist and Certified Financial
Planning Practitioner, Mr. Voudrie provides personal, private money management
services to clients nationwide.
Looking for an energetic expert who is
passionate about financial and wealth management? Mr. Voudrie is an excellent
speaker who will excite and inspire your audience. Mr. Voudrie is available for
a limited number of speaking engagements, television appearances and radio talk
shows. For booking information, email e-mail protected from spam
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Related Articles can be found at www.guardingyourwealth.com under the Guarding Your Wealth
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Source : http://www.prweb.com/releases/2005/6/prweb254805.htm