When I was growing up, there was a famous actor on Saturday Night Live named John Belushi, who also appeared in movies. In one skit, he ran a diner where he would repeatedly say “cheeseburger, cheeseburger, chips” no matter what people ordered. It was comedic gold! But why am I bringing up cheeseburgers and chips in a financial blog? Allow me to explain.
As a certified financial planner, I had to retire due to disability. My retired mentor friend, a wise man in his seventies, suggested I forget about being a financial planner myself and instead hire a good one who could act as a fiduciary and help me enjoy this later phase of life, especially for my children’s sakes.
So, armed with their fancy questionnaires and claims of being published experts, I began interviewing financial planners. But here’s the catch – they never answered the questions in those guides! Instead, they would go on and on about how terrible everyone else was while serving me the same old cheeseburger and chips portfolio. They boasted about their back-tested strategies, exclusive teams, and fancy lifestyles. It was like a broken record on repeat.
It struck me as amusing how they all followed the same approach. They churned out cookie-cutter portfolios designed by some special NASA scientist on staff, charging a hefty 1% fee, and conveniently limited their availability due to their supposed busy schedules. It was like they were saying, “We’re so special and busy that we can’t customize our advice for you.”
I decided to put their claims to the test. I asked them to compare their proposals to simple investment choices like the Oakmark Fund or Vanguard Wellesley Income, which my dad loved. I wanted them to convince me why I should replace my low-cost, straightforward approach with their higher fees and alleged superior knowledge. But, alas, most of them couldn’t be bothered. They simply dismissed me, claiming I didn’t fit their model. It seemed they preferred criticizing others and managing multiple portfolios instead of client relationships while living the high life.
This whole ordeal made me realize that our financial industry is sick. We’re addicted to the idea of being better and smarter than everyone else. We promote ourselves as the best option, but it’s all nonsense. Instead of providing value, we indulge in conflicts of interest and bad practices, using them as part of our marketing schemes. Some even compare themselves to Jesus Christ! Talk about delusions of grandeur.
But here’s the truth: a good financial planner focuses on doing no harm, helping people, and providing real value. I’m tired of multimillionaires in our industry telling those who don’t fit their mold to go away. We should prioritize those who genuinely need our help, even if we label them as clients (or dare I say, victims). A better option is to give back doing Pro-bono work, say for our veterans.
It’s time for our industry to step up and prove our worth. The popular motley fool points out with this research, a lot of work needs to be done-“In a 2016 poll by the American Association of Individual Investors (AAII), 65% of respondents said they mistrust the financial services industry to some degree. In fact, only 2% of respondents claim to trust financial professionals “a lot,” while 15% say they trust them “a little.” Here is the path forward.Show us that you can create personalized financial plans, analyze specific needs and taxes, evaluate insurance policies, and offer honest advice. Don’t just sell unrealistic dreams and claim to beat average index funds after fee’s when you don’t.
As for me, I pledge to honor my commitments as a retired advocate financial planner. I will always prioritize client’s best interest over any company or product I represented, even over my own interests. I am determined to pursue and hold accountable any bad actors and leaders within companies who claim to have your best interest at heart yet demonstrate otherwise by incurring massive ongoing regulatory fines for failing to do so. I firmly believe that we must cast aside the illusion of caring while providing generic solutions riddled with conflicts of interest. If the client really comes first, let’s put their income ahead of shareholders and executives! No more cheeseburgers, cheeseburger, chips. It’s time for real advice and truly the best products and services that brings value and helps you thrive.
The Happy Money Doctor’s Prescription for Sound Financial Advice:
Every unique person deserves personalized advice—demand it and ask for a sample plan.
Request to see your advisor’s portfolio and recent performance—get ticker symbols for transparency.
Perform a broker check on your advisor and their firm to ensure they have not harmed investors.
Before signing any paperwork, have them sign the Fiduciary Oath to confirm their commitment to being on your side. If they hesitate, run for the hills; they are not a true fiduciary.
Article by Thomas M Calkusic MAPP, CFP for The Oregon Journal.