3 WORST Types of Financial Crooks (Don't Get Scammed!)
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- เผยแพร่เมื่อ 20 มิ.ย. 2024
- 3 WORST Types of Financial Crooks (Don't Get Scammed!)
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I was 24 when my first “finial advisor” tried to sell me on whole life insurance. He was also “advising “ me to buy American Funds. Didn’t make sense to me at the time as I was single and had no children. After listening to this it makes a lot more sense 🙄
Almost 27 now, when I was 22 and taking my first steps on my wealth building journey I was put into contact with a mutual acquaintance who was a 'financial advisor.' He had 'free services' so I figured why not talk to him and see what he had to say.
First meeting no sales pitch, just a conversation about large scale financial goals in my life and where I wanted to go. The only weird part was that after the first meeting he pressured me into giving me the contact info of 5 of my friends for referral. I wasn't put off so I decided to go to the second meeting two weeks later.
2nd meeting was completely different tone. First 10 minutes was very high pressure tactics to get me to give the contact info of 10 more of my friends. Very, very off-putting. Then he spent the next hour trying to pressure me into getting a whole life insurance coverage. I hemmed and hawed and told him I needed to do my own research before committing to such a financial obligation. He did everything in his power to make me feel stupid, question my values, and otherwise pressure me to make the sale. It finally got to the point where I told him directly I was not comfortable with what he was doing and walked out of his office.
I think he was running a quasi-scam where he was trying to get people to buy into his life insurance policies he was selling and making massive money on commissions. Then he would use the 'social proof' of the recommendation as leverage to get my friends to signup too.
Advice to other wealth journeyers: do your home work, never be afraid to tell some one you need more time to calmly make a decision, don't let yourself be swayed by FUD tactics, and if you have to do not be afraid to walk out if you feel uncomfortable. Unfortunately, not everyone in this world is looking out for your best interest so you need to arm yourself with knowledge and confidence when you encounter the more 'hostile' types.
That goes with any transaction whether it be a financial advisor, a car sales person, a contractor, etc. Walk away and think about it.
I trust Brian's financial advice mostly based on his haircut
I trust him because he's wrong handed.
I trust him because he owns a Tesla
I’m excited to trust him
I trust him mostly based on his use of the giant coffee mug.
I like the Money Guy Show because the FOO makes complete sense, and my net worth has grown significantly from following it.
I feel like I just attended a high quality conference. I can’t believe this was free to listen to. Thank you for taking the time to teach this
The money guy show should make a shirt that says "I am really excited about this" I'd buy that shirt
2 min in - Yes, you don’t have to pay anything else but they take it out of your cash value and charge you a fee until there is nothing left and then when you die, your heirs get nothing and you threw away your money.
Bo always very excited about *insert topic*
Someday I want to be as excited about everyday as bo is about every topic.
Brian used Low Cost Insurance, it's super effective!
I understood that reference. Lol
“Is one of them term life insurance?” I thought before clicking the video… also, “is Bo excited about this?” 😃
LOVE this!! Very informative!! Outstanding!
I have two more years until my term life insurance terminates. What would you suggest for a 70 year old who is married.
Thank you Team Money Guy!
I feel like my new dentist is always trying to separate my money from me.
Funny I feel the same way. Lol. Come in for a cleaning and they want to do 20k worth of dental work. Lol
Thanks for all of the content you've made over the last few years! Respecting the FOO has helped my family thrive during the pandemic with regards to changing incomes and expenses. Could you expand a little from the personal finance world to do a show about how you would think about starting a business? I haven't really seen anyone give good in depth "Money Guy" style advice on this topic. If it's not something that you think fits the channel, have you seen anyone that isn't likely to be a scammer? I'm in the hospitality industry, so start-up costs are not insignificant. Just a little general background in case it helps... currently between step 5 and 6, 40 years combined industry experience (myself and my wife), potential existing restaurant for sale, 20% listed price saved outside of the FOO.
Alright, Brian and Bo. What should we do if we’re already in American Growth Funds? I’ve been in it for probably 15 years so there is a decent chunk in there.
Ditto!!
@@theperpetualdreamer9913 was really hoping they’d do a follow up on this. Now I’m second guessing if I should hold these funds or reallocate somewhere else.
Common advice I've heard: 1) swap immediately all funds in retirement accounts (not taxed) 2) stop investing dividends 3) sell any lots with losses 4) work around the rest. Consider donating remaining shares to charity in place of cash
Good Morning from Memphis
The videos were much clearer at the old location/set.
Love the quiet mention of the “2&20” fund setups.
If one of them consistently outperforms over the long-term they would have most of the AUM for that market, yet they DON’T. Sounds to me like the marketing is more important than the markets🤔
Some of the salesmen are actually convinced that whole life plans are the best investment. I have a buddy who sells it and is his only investment as well.
Have a friend like this as well. Smart guy too, but he got convinced so hard he started selling whole life.
@@bobp4036 odd right? I think that belief in the product might actually make them better salesmen too.
I’m a Fiduciary Advisor and I do implement Whole Life, but has to be a super specific reason why it’s needed in this plan. It is not intended for everyone. You shouldn’t own Whole Life if you don’t have 401K maxed, Roth IRA, maxed out HSA, 3-6 months of living expenses saved, emergency funds. If you have all this and still have extra cash. Maybe an alternative asset class can be implemented. It just depends on the situation. Whole life salesman make us look bad.
@@DV3Financial I wouldn't say this is the only circumstance under which owning permanent insurance is beneficial, as it serves multiple purposes beyond its role in a retirement plan. However, if we're talking about maximization of a retirement plan, this is the right way to think about integrating whole life into a plan.
@@maliqmatthew1009 absolutely. Volatility Buffer. I typically illustrate it using WBC and it always blows people away. Mitigate sequence of return risk.
I had to listen to one part several times because Brian says "this isn't a typo or mispoken" but the he goes on to says AGTHX is just over half a percent and FXAIX is just "slightly over one percent". And I don't get it because 0.015% is not over one percent. His statement makes it sound like FXAIX has a higher expense ratio. Is that what he's saying? 0.015% looks like a great expense ratio to me.
Yeah. He misspoke. He saw 0.01 and thought 1%. But it’s actually 1% of 1%. Very cheap
Yes, he misspoke after saying he wasn’t misspeaking. It is slightly over 1/100th of 1 percent…not just slightly over 1 percent. 1% would be a huge fee.
Man, more and more I listen to Bo. He reminds me of Linus Sebestian from LinusTech. Y'all look alike and sound alike.
My Roth is with American Funds so that stinks. I max that out my wife is starting a 401k everything else we just through into an ETF
Ours too. I just did a check on our funds performance and expenses. Sent an email to move to the same ETFs we have in our joint account.
You can roll your Roth IRA to wherever you want. Selling shares within an IRA has no tax consequences. 1)Roll directly to Vanguard/Fidelity/Schwab. 2)sell and buy what you really want
Doesnt Permanent insurance costs more because there's a cash value that grows and you can make money? Like an IUL?
No, that's not why it costs more. Whole life insurance costs more because term is underwritten with the assumption that the insured will most likely outlive the policy. Term insurance is lucrative for an insurance company if its underwriting process is sound enough to select on likelihood of payout, because premiums add up over the years and only offset if there is a claim at the end. With permanent insurance, the eventuality is inevitable, so they have to charge more due to the fact that granting a policy means accepting the certainty of paying that claim eventually. The premiums plus the growth in the account are expected to offset the cost of that death benefit, and the premiums are level for whole life so that the low cost of insuring someone early (less likely to die in the near future) balances out the high cost of insuring later in life.
Cash value in a whole life policy is merely the part of the death benefit that one has current access to based on equity built within the policy over time. The convergence between the amount of cash value available and the size of the death benefit is greater and greater as one gets older, until the policy vests at a designated age (say, age 100 or 121) and the death benefit and cash value are entirely the same from that point forward.
If you did a 10 year window on the American Funds, the results are much closer. Growth tilt funds in 2022 have performed horribly. Also SP500 fund is a blend. Not an apples to apples comparison
#1 financial crook are scuzzy insurance salesmen calling themselves a financial advisor. #2 financial crook are scuzzy dually registered financial advisors calling themselves fiduciaries while getting you to sign away your life in a discretionary managed portfolio and earning commission on third party products, normally an insurance annuity, he purchased into your portfolio, then also charging you a management fee for that self-managed annuity into the managed portfolio. #3 financial crook are scuzzy insurance salesmen calling theselves a financial advisor selling you retirement investment products where 1% goes toward front end mutual fund and 99% goes toward permanent insurance.
On the #2 financial crook. Let's no over emphasize fiduciary, because of the dually registered financial advisor. CFPB wanted to expand fiduciary responsibility over all financial advisors, but the Trump admin quashed that, and then pursued policy that allowed dually registered financial advisors to profit through third party commission/kickbacks as if those crooks could wear fiduciary hate one second, then take off that hat to sell you third party products. Worse than that, is that the Biden Admin in 2021 adopted that Trump admin policy, so now more scuzzy dually registered financial advisors hiding behind fiduciary label can still earn commission/kick backs from third party products they sell or buy (if you sign away your life in discretionary managed portfolio) for you.
anyone who works captive has quotas to meet and they only care about their own bottom line
Hey guys you should do a response video to Andrew Tate the most popular guy in social media... he gives lots of financial advice and im sure this would get plenty of views for you!
How would I go about finding someone like you to help me with my financials? What are the differences between CFP, CPA, PFS, CFA ect.?
Thrivent Financial has some great financial advisors! I personally have been getting help from Tara who teaches us vs telling us what to do.
CFP is certified financial planner & the standard designation for a financial planner. (Held to legal standard to do what is best for you. HOWEVER, learn how your financial planner/advisor is paid! Go for someone who is paid on a "fee-only" basis and not commission.)
CPA is a certified public accountant & the standard for accountants.
CFA is certified financial analyst & standard for someone who does research on investments. Comparatively a lot harder than the CFP but doesn't go as broad as the CFP. CFA deep dives into security analysis while the CFP goes more broad into estate planning, income tax planning, retirement planning, education planning, budgeting, etc.
Obviously, do your own research too but I am majoring in finance & minoring in wealth management/financial planning now. Also had an internship this past summer to learn more about the industry as a whole and from what I have gathered, you always want to go with a CFP specifically and someone who is paid on a "fee-based/fee-only" payment schedule
@@JERRRY26 thanks for the detailed response! I will continue to look into this more and appreciate the fact you said typically you want a fee only CFP after giving the background information.
@@JERRRY26 yes I agree! My financial advisor is not commission paid but did charge me a fee for a detailed financial wealth building plan. We also have a 6 month check-in. I switched from Edward Jones where the fees were much higher.
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Your AGTHX calculation is EXTREMELY off. Your yahoo finance data only included price data, meaning because AGTHX has high turnover that a lot of the money ends up getting distributed as LTCG and STCG instead of the fidelity fund of which most is not distributed because it has low turnover.
I just looked it up on portfolio visualizer, and factored in the front end load. Getting a 60.8% return from sept 2017 to July 2022. For FXIAX getting 82.2% return.
I hate American Funds and their ER and loads as much as the next guy, and just got my parents out of them, but this data is just wrong.
Same with Brian slipping up and saying FXIAX had over 1% ER when he meant to say 0.01% ER
Yeah their analysis is way off here - I put FXAIX and AGTHX into a YCharts and did a 5-yr total return comparison. If you invested in each on 8/11/2017, your total return (this is including dividend/cap gain reinvestments) as of today on AGTHX was 79.64% versus 88.28% on FXAIX. On the 10 year lookback the two funds are within a percent of each other, slight lead to Fidelity (263.5% vs 262.8%.) Fidelity wins in this case, but not by as much as they are supposing! Notably as well, from the crash in 2020 up until November 2021, the American fund was significantly outperforming the index, although they gave eventually up all those gains this year. I'd still pick the index fund personally, but it's not as night-and-day as it would seem based on the example presented in this video.
@@ryanshredz9743 yeah make sure you are multiplying the cumulative return times * .9425 * initial investment to account for the immediate 5.75% loss in sales charge
My husband’s roth ira open through credit union has Agthx. It’s horrible. I also have another one opened through credit union also has two other american funds. I will stop making contributions in those two and open roth ira in fidelity which i have our hsa accts with.
@@CammieKN you can even transfer those credit union funds to fidelity too if the fees aren’t too ugly. You can sell tax free in a Roth and get into something more broad and cheaper!
@@ryanshredz9743 also keep in mind that sp500 isn't even AGTHX's index. large cap growth is its index. and those products (fidelity's or Vanguards) have absolutely annihilated it in the past 5,10,and 15 years. and thats even before the front load (you can buy it in different share types with a bit more expense but no front load GFAFX is the f1 load class)
American funds Large Cap Blend products have performed even worse.
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Financial advisors are first when they make money when you don’t or on any dividends you make at a higher rate than market. The ones that say you’re young & can make more by doing a flow. Idiots
Making money is not just a science, but also an art. it is 30% science and 70% art. a fellow creator~~~~
Like others in the comments I agree that the Fidelity fund is way better and I happen to have about 20% of my portfolio in that particular fund
However your analysis is way off
First off the two funds are totally different the growth fund of America is more similar to the blue-chip growth fund of fidelity of which those expense ratios are approximately the same
Second off the percentage games are not even in the right ballpark for either fund
Come on money guy I’m just a regular guy and this is what I am saying so I know you guys can do better than this
This is the fourth time now that I pointed something out that you said that is wrong the other times you guys have deleted my post
yeah, the SP500 fund beats class A share AGTHX 5-10 years (with load paid) and Fidelity's Large Cap Growth Index absolutely trounces it.
yeah google finance just shows the price which doesn't matter 1 lick in a mutual fund. each year there is turnover and distributions which are used to purchase more shares at whatever price. Its pretty stupid to use it to compare really any product, etf, mutual fund, stock against another.