I am often asked, “Why have I taken such a stance against
commissions and those that sell financial products?”
Most Financial Advisors in my area (on some level) are
financial product salesmen. They earn a significant portion of their income
selling loaded Mutual Funds, life insurance, and/or annuities.
What’s wrong with commissions? What’s wrong with selling
financial products?
I have no problem with commissions. And I have no problem
with those who are honest and admit they are Financial Sales people.
My problem lies with those who try to pretend they are an
Advisor or a Planner when in fact their hidden agenda is simply to sell you financial
products.
If your Financial Advisor must get you to purchase a
particular product to earn their living, how do you know if they are looking
out for you or their wallet?
Mutual Funds Truths
Many No Load mutual funds are better than mutual funds with
a commission. Has your salesperson ever told you this?
Many Broker sold mutual funds have very high annual
expenses. Has your salesperson ever talked to about how much high mutual fund expenses
will rob from your retirement?
Annuity Truths
Variable Annuities that pay a commission can cost you 3-4 times
as much as a commission-free Variable Annuity. Has your salesperson ever told
you this?
Index Annuities: in my opinion, there are way too many lies
being told about Hybrid or Index Annuities to mention here. Just remember, you
can’t have your cake and eat it too!!!
A Word of Caution
All Financial Advisors have a choice (yes, your Advisor has
a choice). A choice to sell financial products on commissions or not. Stop and
think… Why do most Advisors continue to operate their businesses by way of
commissions when they have a choice?
All financial products have good and bad. ALLLLLL!!!!
Depending on your situation, many products have more bad than good. Don’t you
think you deserve to know the truth?
If you aren’t working with a Commission-Free / Fee-Only
Certified Financial Planner chances are you will never hear about many of the
negatives with most financial products.
I see examples of the above almost every week.
And that’s why I don’t trust many financial advisors.
1 comment:
The charitable gift annuity is a contract between you and the charity. The charity is legally obligated to pay a fixed rate of income for your lifetime that is locked in at the time the gift is made. However, if you make a new gift a year or two later, the rate will likely be a little higher for that gift annuity since you are a little older. A charitable gift annuity is in reality a bargain sale—part sale and part gift, because you are giving an amount to the charity that exceeds the annuity it promises you.
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