Wednesday, September 14, 2011

Brainwashed Thinking

I was at a meeting recently and I had some conversations with some insurance agents, some bank representatives and registered representatives. This was just idle chit chat about what I do and what they do. I was very surprised how brainwashed these people are by their affiliations. They have no clue what it means to be a fiduciary and deliver advice in a client's best interest.

The SEC is currently evaluating how to apply a fiduciary standard to these type of professionals. I can tell you, the SEC is facing an uphill battle.

One of the people I spoke with in my idle chit chat was an insurance agent. I told this person that I recently had a seminar with planning ideas to help seniors qualify for Medicaid Planning and Veterans Benefits. This person's first question was ..."what products do you sell to them?" Those of you who have read my book, or seen my latest brochure will know that insurance agents are compensated by product sales. Unfortunately, this is all they know. They know that they get paid by product sales. When someone asks..."what product do you sell to them?", then that tells me what they focus on with their clients. They focus on themselves. This of course, is contrary to a fiduciary standard of care.

My answer to to this person was that I did not sell products to them, but rather I did what was in their best interest and only charged a fee for my services. This person persisted with...'but, you have to be selling some products. What products are you selling?" I was really taken aback about how the blinders over this person's eyes are affecting their objectivity. I may be reaching a little bit here, but the concept of charging a fee and doing something in the best interest of a client seemed to be so far removed from this person's thinking that it was not even a remote possibility.

Quite frankly, I was astonished. Sadly, most of the people in my business work at banks, insurance companies or Wall Street firms. They have all the marketing dollars and political power. They are so brainwashed into the product sales mentality that they cannot even imagine what it takes to do something in a client's best interest. Like I mentioned earlier, the SEC is facing an uphill battle.

Another person that I chatted with wanted to know if I was in the Financial Planning Association. The FPA is made up of CFP's and other professionals who are mostly people who work at banks, insurance companies and Wall Street firms. Take a guess how excited I would be to run around with a bunch of people like these folks.

This person saw my CFP lapel pin and said that I should join. I then said, "Why?" He said, "because you are a CFP and the FPA is for CFP's." I said to this person, "you are going to have to do better than that." The attorney standing next to me laughed when I said that. This person, who was a bank representative by the way, went on to try and convince me of the wonderful educational opportunities and continuing education available. As a courtesy, I gave this person my business card, but I have to admit that I am kind of like Groucho Marx in this area. I will not join any organization that wants me to join. The truth is the FPA is in decline and they are losing a lot of members each year. Every time I run into one of these people, they are trying to convince me to join the FPA. If it truly was a good organization, then no one would have to recruit for it. This tells me that it is a lobbyist organization with a bunch of fat cat salaried people trying to justify their existence. I will not be giving them any of my money.

The last thing I want to do is go to a meeting where insurance company home office people are telling me how great their products and commissions are for insurance agents.

I am very comfy in my own little world of the fiduciary standard and doing what is in the best interests of my clients, thank you very much.

Later my friends.