One of my partners recently received a very interesting brochure in the mail. It was an invitation to enroll in an “Educational Course for Adults — Ages 50 to 70.” The brochure states that the course is being conducted at Oglethorpe University, a well respected institution of higher learning here in Atlanta. In parenthesis (and smaller font), they disclose that the course is not affiliated with the university. It seems that the course presenters are only renting out a classroom. The brochure is eight pages long and includes a Course Outline and a Course Preview. They plan to cover “Retirement Needs and Expenses,” “Retirement Roadblocks and Mistakes,” and many other areas of interest to retirees and those approaching retirement. The instructors represent that they have earned the Certified Financial Planners designation. They are affiliated with LPL Financial, which is the largest independent broker-dealer in the U.S..
This course appears to be somewhat different than the free lunch scourge that has cost so many seniors so much. The presenters charge $49 per student and provide a course book. But, like the free lunch seminars, it is a marketing initiative. The presenters would admit as much and need not be bashful about it. My skepticism comes from seeing how much misleading information has been passed along at similar gatherings. The last time the SEC, NASAA, and FINRA took a look at these types of gatherings, they found that only five percent of the meetings were free from rule violations and ethical lapses. If retirement planning courses at local colleges are the next iteration of free lunch seminars, I wonder what will keep these courses any cleaner than their predecessors. I also wonder whether the adviser leading this seminar will disclose that he was sanctioned by the Georgia Securities Commission and that he sells a lot of insurance products, which tend to be very expensive for the investor and very lucrative for the salesman. I am guessing that none of that will come up.
I have doubts that anyone registered as an investment adviser, much less a CFP, could sell high commission insurance products without breaching his or her fiduciary duty to clients. I can imagine a path that would allow for selling insurance products and upholding the duty, but it is a path that no RIA I’ve ever encountered has walked. What makes you think that your RIA will walk it? The bottom line is that you need to know much more before you entrust your money to anyone. General advice from your favorite consumer reporter won’t keep you safe. And you should take advice from a financial adviser, who has an obvious financial interest in managing your money, only after you’ve learned more about how they operate. Get advice from someone who has no financial interest in managing your money before you venture into the world where everyone wants a piece.