Advisors Are NOT Decision Makers – and Vice Versa

Advisors Are NOT Decision Makers – and Vice Versa

As people consult with us daily, we are discovering that, for the most part, they have very little idea about the way their financial products work or fit their financial goals.

Lately, we are seeing an alarming trend: In hindsight, everyone seems to discover they own the wrong product/plan. What is disturbing about this is the fact that in all the cases I have witnessed personally, these unsuspecting investors were offered these supposedly golden products or enrolled in plans by their so-called advisors without having any real understanding of what they were getting into.


I am willing to bet there’s a good chance you have fallen prey to this unnerving phenomenon. Simply ponder these questions about your own retirement plan:

• Who decided which product(s) you should own (beyond any funds you may have personally selected)?
  

• Do you really know why you ended up with that particular product/plan?

• Were you provided with any clear options (again we’re talking about products, not fund selection)?

• How do you know you have the best plan to fit your needs?

They’re Called Advisors, Not Doctors

Plain and simple, a financial advisor is supposed to understand your goals, assess your situation, and – get this – provide you with legally available product options, explaining to you in clear words how each of them work.

Instead, what we discover every day with our clients is that investors are lured into products that often are not in their best interests, and they never even discover this until it’s too late. In most cases we have witnessed, the only logical reason underlying their purchase of a particular product/plan seems to be the interest of these so-called financial advisors’ commissions and/or company profits.

A financial advisor’s role is not the same as a doctor’s. In the case of medicine, situations arise where your physician understands and knows the only course of action and suggests it to you. For instance, when a specific surgical procedure must be performed to correct a health issue, your doctor tells you exactly that: this is your only option, or you will die. But if you didn’t want to live, you probably would not have sought medical treatment in the first place, right?

Having been a financial strategist for many years, and having helped numerous families plan for their retirements, I contend that in almost all instances, there is more than one financial product for a particular scenario, and it is in the clients’ best interest to be informed of these choices. Unless a product is like oxygen – and, honestly, no financial product is – an advisor should never advocate any single product as the solution everyone needs to survive.

Why Did You Choose Your Current Financial Product?

I ask this question all the time, and the most familiar answers I hear are:

• My advisor said it was what I needed.
  

• You mean there’s another option? (In other words, “That was the only product I was offered.”)

The big problem here is that the advisor is owning/making the decision. According to a recent report by The Vanguard Group, 84 percent of its more than 3 million retirement-plan participants did not make any changes to their accounts in 2008. Although various reasons may account for this, you do not have to be a mind reader to know that most of these investors do not even understand which financial products/plans they own – because someone else (i.e., their advisor(s)) made the choice.

Don’t you see, read, or hear it all the time? Some expert has already decided that an IRA, annuity, or some other product is best for you – all you have to do is contact them and sign up? Well, in my view, that’s nonsense! And it explains why the large majority of people experience complete financial crashes during their golden years.

At Laser Financial Group, we always provide our clients all the possible options, based on their specific scenarios, with detailed, year-by-year and side-by-side comparisons, explaining the facts about each of these options. And 100 percent of the time, they tell us what would best meet their needs. From that point forward, they are able to explain to anyone which product/plan they own, how it generally works, as well as why it is best for them. You’d think this makes sense and is a simple enough concept, but when was the last time you were offered such an option?

It’s high time some so-called financial advisors quit dictating to clients which products they should own, instead explaining to them their options and letting them exercise their right to choose what would best serve their needs.
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Find out how we're different from traditional financial advisors. Please call our office at (301) 949-4449 or visit http://www.laserfg.com/ to schedule your free consultation.