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Add You - Annuities - Equity Indexed Annuities - The Next Big Scandal
When you decide to begin your own business, you will get startup advice from everybody that surrounds you. Some startup business ideas will be helpful and productive; but others will be advice that is decent at best. Fortunately, you can find many services and programs that are dedicated to giving you expert business startup help and advice to get you started on the right track for success. Before heeding any well intentioned advice, you can take a few steps on your own to help you achieve success in your new business venture.One of the best pieces of business startup advice is to get organized. A good da
The structure and sales practices of almost every other commission-based investment product are regulated by the Securities and Exchange Commission. Mutual funds, stocks, bonds and variable annuities are all regulated at the federal level. Equity Indexed Annuities are not.
If an advisor were to place 100%
In the past few decades, there has been a great revolution in the way the management deals with and treats its employees and staff. Gone are the days when corporate houses considered it a favor to the employees to have them work with their company. In present times, there has been a paradigm shift in favor of the employees. Every corporate house tries its best to make its working environment rewarding and the job profile lucrative for its staff. Tremendous efforts are made to retain competent staff and increase productivity through a healthy work environment.The top management has to make a commitment tow
We have seen many scandals the last few years relating to mutual funds, variable annuities and more recently, to insurance companies. The common theme in all of these scandals has been the existence of hidden conflicts of interest.
There is an unspoken trust when someone purchases a financial product. When someone is uncomfortable making a purchase on their own, they seek out the advice of a financial advisor. They expect that advisor to make a recommendation that is in the client’s best interest, not the advisor’s.
Unfortunately, most financial advisors are compensated solely by the commission they receive from selling financial products. The more they sell, the more they make. If they don’t sell, they don’t eat. This alone creates a tremendous conflict of interest between them and the client.
Consumers understand that conflict of interest in other purchases they make. You wouldn’t expect a car salesperson to recommend a vehicle that isn’t offered by their dealership. So consumers view the salesperson’s recommendation with a healthy dose of skepticism.
That same skepticism should be applied to the purchase of financial products as well. Those who purchase mutual funds or stocks are fully aware of the commission they’re paying. However, few Equity Indexed Annuity consumers are aware of the commission their advisors are making off of their purchases. I’m not against an advisor making a living; what concerns me is when the client is not made aware of the powerful forces influencing what their advisor is recommending.
This is why I feel Equity Indexed Annuities may be the Next Big Investment Scandal. The hidden conflict of interest between an advisor and client is greatest when an Equity Indexed Annuity is being recommended. There are huge incentives designed to motivate an advisor to recommend an Equity Indexed Annuity over any other financial investment they offer–incentives that aren’t disclosed to the client.
An advisor can make more commission from selling an Equity Indexed Annuity than they can from any other investment they offer. A lot more. In some cases, the amount of commission is three to four times greater than on an investment like a mutual fund.
Equity Indexed Annuities (EIAs) are not regulated at the federal level, but by each state’s Insurance Commissioner. Even though Equity Indexed Annuities are technically an insurance product, they are being marketed as an investment. But all an agent has to do to be able to sell them is sit through a five-day course and pass a simple test on health and life insurance.
The structure and sales practices of almost every other commission-based investment product are regulated by the Securities and Exchange Commission. Mutual funds, stocks, bonds and variable annuities are all regulated at the federal level. Equity Indexed Annuities are not.
If an advisor were to place 100%
The other day I had an appointment to meet with a client about a real estate classifieds website. We decided to meet at a local restaurant and discuss the project over a few beers and oysters. For the first hour or so we talked about his goals and the general operation of the website, the design, functionality and his goals for the next year or two. I finally asked him about his marketing budget and what forms of advertising he was planning to use. Not to my surprise, he replied "I will just get listed in Google and the rest will fall into place." Mind you, I'm sitting there with a well proposed business plan i
Unfortunately, most financial advisors are compensated solely by the commission they receive from selling financial products. The more they sell, the more they make. If they don’t sell, they don’t eat. This alone creates a tremendous conflict of interest between them and the client.
Consumers understand that conflict of interest in other purchases they make. You wouldn’t expect a car salesperson to recommend a vehicle that isn’t offered by their dealership. So consumers view the salesperson’s recommendation with a healthy dose of skepticism.
That same skepticism should be applied to the purchase of financial products as well. Those who purchase mutual funds or stocks are fully aware of the commission they’re paying. However, few Equity Indexed Annuity consumers are aware of the commission their advisors are making off of their purchases. I’m not against an advisor making a living; what concerns me is when the client is not made aware of the powerful forces influencing what their advisor is recommending.
This is why I feel Equity Indexed Annuities may be the Next Big Investment Scandal. The hidden conflict of interest between an advisor and client is greatest when an Equity Indexed Annuity is being recommended. There are huge incentives designed to motivate an advisor to recommend an Equity Indexed Annuity over any other financial investment they offer–incentives that aren’t disclosed to the client.
An advisor can make more commission from selling an Equity Indexed Annuity than they can from any other investment they offer. A lot more. In some cases, the amount of commission is three to four times greater than on an investment like a mutual fund.
Equity Indexed Annuities (EIAs) are not regulated at the federal level, but by each state’s Insurance Commissioner. Even though Equity Indexed Annuities are technically an insurance product, they are being marketed as an investment. But all an agent has to do to be able to sell them is sit through a five-day course and pass a simple test on health and life insurance.
The structure and sales practices of almost every other commission-based investment product are regulated by the Securities and Exchange Commission. Mutual funds, stocks, bonds and variable annuities are all regulated at the federal level. Equity Indexed Annuities are not.
If an advisor were to place 100%
Article syndication is nothing but the process through which an online site shares articles with other sites on the web. Due to the huge improvements in the field of science and technology the web has become the hub where all activities take place. So now if you need any information about anything or just want to find out something you are literally a click away from the information. Article syndication is the one means by adopting which information can be disseminated all over the web. The idea behind having any kind of online presence is to get recognition. And what better recognition can one get then being r
That same skepticism should be applied to the purchase of financial products as well. Those who purchase mutual funds or stocks are fully aware of the commission they’re paying. However, few Equity Indexed Annuity consumers are aware of the commission their advisors are making off of their purchases. I’m not against an advisor making a living; what concerns me is when the client is not made aware of the powerful forces influencing what their advisor is recommending.
This is why I feel Equity Indexed Annuities may be the Next Big Investment Scandal. The hidden conflict of interest between an advisor and client is greatest when an Equity Indexed Annuity is being recommended. There are huge incentives designed to motivate an advisor to recommend an Equity Indexed Annuity over any other financial investment they offer–incentives that aren’t disclosed to the client.
An advisor can make more commission from selling an Equity Indexed Annuity than they can from any other investment they offer. A lot more. In some cases, the amount of commission is three to four times greater than on an investment like a mutual fund.
Equity Indexed Annuities (EIAs) are not regulated at the federal level, but by each state’s Insurance Commissioner. Even though Equity Indexed Annuities are technically an insurance product, they are being marketed as an investment. But all an agent has to do to be able to sell them is sit through a five-day course and pass a simple test on health and life insurance.
The structure and sales practices of almost every other commission-based investment product are regulated by the Securities and Exchange Commission. Mutual funds, stocks, bonds and variable annuities are all regulated at the federal level. Equity Indexed Annuities are not.
If an advisor were to place 100%
The number one sign that you may be experiencing click fraud is that your pay-per-click campaign costs are continuing to rise while your online sales are not meeting expectations. Sometimes if a keyword is too broad you may also experience this. If your cost per click is really sky rocketing then you are most likely experiencing click fraud. Click fraud usually happens to people who are in a number one position or who are competing for a highly contested keyword.The number two sign of possible click fraud is that your conversion rate for paid searches are lower than the conversion rate of your free listin
An advisor can make more commission from selling an Equity Indexed Annuity than they can from any other investment they offer. A lot more. In some cases, the amount of commission is three to four times greater than on an investment like a mutual fund.
Equity Indexed Annuities (EIAs) are not regulated at the federal level, but by each state’s Insurance Commissioner. Even though Equity Indexed Annuities are technically an insurance product, they are being marketed as an investment. But all an agent has to do to be able to sell them is sit through a five-day course and pass a simple test on health and life insurance.
The structure and sales practices of almost every other commission-based investment product are regulated by the Securities and Exchange Commission. Mutual funds, stocks, bonds and variable annuities are all regulated at the federal level. Equity Indexed Annuities are not.
If an advisor were to place 100%
Among the many innovations that emerged after World War II, credit use has become a major factor in our entire economic profile. As a result, your credit rating is the most important factor in determining your credit APR when you apply for any type of credit: credit cards, 0% APR transfer offers as well as mortgage and car loans.What’s a credit score?Credit reporting was created more than 100 years ago, when small retail merchants banded together to trade financial information about their customers. These merchant associations formed small credit bureaus, which later consolidated into larger
The structure and sales practices of almost every other commission-based investment product are regulated by the Securities and Exchange Commission. Mutual funds, stocks, bonds and variable annuities are all regulated at the federal level. Equity Indexed Annuities are not.
If an advisor were to place 100% of a client’s investable assets into a variable annuity or a single stock or mutual fund, they would likely face fines and possible revocation of their license. At the very least, they would be opening up themselves and their firm to potential lawsuits. Yet, I often hear of advisors telling a client that they should put 100% of their money into Equity Indexed Annuities.
Under federal regulation, an advisor can’t recommend a client pay a 7% penalty to get out of one annuity and move then move that money into another high commission product. That’s just like a stockbroker getting you to constantly buy and sell stocks so they can earn a commission–it’s called churning. Yet, I see advisors using the ‘bonus’ offered by some Equity Indexed Annuities to do just that.
I am an advocate for the individual investor, and apparently one of the few in the financial services industry willing to speak out against this popular product. But Equity Indexed Annuities are beginning to attract attention. I was interviewed by CBS MarketWatch just last week about the dangers associated with Equity Indexed Annuities. Those in Congress are recognizing the need for federal regulation of insurance products.
So think twice before buying an Equity Indexed Annuity. The agent may not have your best interests at heart.
To find out more about the dangers of Equity Indexed Annuities, give me a call, send me an email or read my other articles at www.guardingyourwealth.com. They will tell you what the agent isn’t.
Mr. Voudrie is a Certified Financial Planner and the President of Legacy Planning Group, Inc., a Private Wealth Management firm in Johnson City, TN. For more information email jeff@guardingyourwealth.com.
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