Beware of Older Actors Peddling Financial Products
You may have noticed the parade of older actors on cable tv who are peddling financial products to senior citizens. Marketing financial products to older Americans is big business, and you need to remember that these people are actors, not advisors.
The reason you see companies using older actors is because they've probably determined that these actors convey some level of trust and confidence to consumers in the age bracket they're targeting. But you shouldn't let the marketing cause you to drop your guard.
For whatever reason, older consumers seem to have a higher tendency to get drawn into financial arrangements that may not be in their best interest. It might be that older Americans are used to a more trusting environment and aren't quite as skeptical as younger consumers. Regardless of the reason, it's important to recognize that as you age you might be more susceptible to making poor financial decisions.
To help protect yourself, you should think about having someone serve as your advocate when it comes to financial decisions.
You've probably heard people suggest that if you're going to the doctor and expect to receive some important or complicated health care information, it's a good idea to have a trusted friend or family member accompany you. Why? Because it's hard for any of us to process complex information, especially if it impacts our health.
The same is true for finance, with one big difference: the people you're meeting with generally want to sell you something. So having a trusted family member involved in your financial decisions is an important aspect of protecting yourself. Not only can they help you sift through the details and think about what might be best for you, but they also send a message to the person who is trying to sell you something. You're telling them that you're serious about this process and you expect to be treated fairly. That may have some impact on how they approach you or present their material.
While marketing is an important and legitimate part of operating a financial services business, you have to separate the marketing from what's best for you. You should be skeptical and tough with your questions, because you're the one who needs to live with the products you buy, not the marketing department.
You can also take a more formal route for financial guidance by hiring a financial advisor who serves as a fiduciary.
- A fiduciary advisor will help you determine what sort of financial strategies or products fit your needs and is obligated to give you the advice he or she believes is in your best interest. Registered investment advisors operate as fiduciaries.
- Fiduciary advisors generally work for a fee that you pay directly to them for their advice. This is much different than a commission that is paid to a sales person by the financial services firm whose product they just sold.
- If you're not sure what standard someone is operating under, ask; you can also check with your state and federal financial regulators to confirm the advisor's fiduciary status.
Learn More: Want to learn about a simple way to manage your personal finances and prepare for retirement, investigate my new book Your Money Ratios: 8 Simple Tools For Financial Security, available in bookstores and at amazon.com The Wall Street Journal called the book "one of the best finance books to cross our desks this year." WSJ 12/19/09.
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