DO YOU HAVE A FINANCIAL DREAM OR A FINANCIAL NIGHTMARE?

This photo has an alarming warning: “danger steps are steep and slippery”. Why not build a handrail to prevent injury rather than stop with a warning to deflect liability?

Financial advertising often entices you with dreams of a wonderful life. Here are five key trends since the 2008 global financial crisis, according to Getty Images

1. Targeting women
2. Bringing surprise
3. Wealth is more than money 
4. Small businesses
5. Regaining trust

None of the trends aim at making people feel bad. The 10 most viewed financial ads on YouTube avoid negativity too (The Financial Brand, Nov 2012).

Didn’t Get The Memo

At a recent networking event, we were subjected to an infomercial from an advisor from a major company you'd recognize. He said our financial futures are less secure than we think. His solution? Buy investments and insurance from him.

Really?

I couldn't help but think about his current and former clients. Weren't they messed up too? Unless this advisor is an unknown financial wizard, didn't he contribute to their plight? At the same time, wasn't he profiting while they suffered? After all, he sold high margin mutual funds instead of low cost ETFs.

He was handing out business cards like candy. They were being received like apples with razor blades. I noticed he had no designations. That's not reassuring. He could serve clients better with some financial education. Do you think he charged less because he knew less? There was no blog or other clues online to show his expertise either.

There are reasons our financial futures may be more nightmarish than dreamy: erosion of investments, uncertain future returns, high investment expenses, inadequate health or life insurance, job uncertainty, longer lifespans and unexpected costs such as health care.

Luckily, this advisor didn’t have more time at the microphone to spread more gloom. I didn't see a line of people heading toward him for their financial salvation. The buyers were beware.

Plans

• Flaws in the financial advisor system (Feb 2012, The Globe And Mail)
• If you have/had/want money, read Pound Foolish
• Do you have a financial advisor or a financial salesperson? (RetireHappy.ca)
• Why insurance advisors also sell investments
• Where is your advisor’s blog?
• image courtesy of Kenn W. Kiser

Podcast 214

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PS Getting help may be a great idea.