Tuesday, July 13th, 2010
Last month, one of my Coffee Talk calls got a little heated!
The topic was “Dirty Little Secrets Annuity Companies Hope You Never Find Out About.” During the Q and A session at the end of the call, this guy called me out for “inciting fear” about annuities.
Actually, to be specific, he said, “you made some pretty critical mistakes in your analysis of the way that fixed index annuities work as far as how the insurance companies are compensated. You didn’t disclose that the Wharton School of Business has evaluated fixed index annuities vs. just about every other possible investment strategy out there for the last 15 years and the fixed index annuity, although it was the safest, actually had the best performance. You were off by probably by as much as 10% on your assessment of commissions. I’m just wondering if the point of this discussion was to educate or incite fear.”
At that point, I asked him if he sold fixed index annuities. Guess what his answer was?
Now, I’m open to being proven wrong. The problem is, when I’m challenged like that, the person doing the challenging usually has a vested interest in (that they sell or represent) the type of product I’m not recommending! So I just want to make it clear that I have no axe to grind, product-wise.
We are a fee-only investment advisory and wealth management firm, meaning we don’t accept or collect commissions from any product of any nature. So if it’s a good investment we want to know about it and make everybody aware of it.
You’ve probably heard the term ‘real estate millionaire’, ‘stock market millionaire’ or ‘business owner millionaire’. But I’ve never heard the term ‘annuity millionaire’…have you?
I also get very leery of anyone who uses ‘research’ from a supposedly credible source as part of their ‘sales pitch’. Usually that source has either been misquoted or was paid for their research by the people using it to support/defend their sales pitch.
There are a lot of junk investments out there that aren’t talked about nearly often enough — and we’re going to start exposing them.
No matter who might be on the other end of the line!
Tags: brian Fricke, certified financial planner, finance, financial advisor, Financial Management Concepts, financial planner, Financial planning, retirement, retirement planning, wealth management
