Jump to content

Getting Started With Investing

Recommended Posts

I'd like to see a federal "truth-in-investing" form, required at all "closings" of investment sales of annuities. Similar to the one required in real estate transactions. In plain English, the form would add up the total costs over 30 years versus a no-load fund, for example. The agent would be required to sign off that this was, in his opinion, the most prudent investment vehicle for a particular client.


Here is an attempt from just last week for an agent to gain entrance to the teachers:


My response to him follows.


My name is _____with the ______Companies and I am the

> building

> representative for your school. I was at your building last Tuesday

> and

> met and talked with ______for 15 minutes. We discussed some

> of

> the programs that Horace Mann offers education association members.


> One of the main things that ________provides to the association

> members

> is their Professional Liability Policy. Most educators don't know

> anything

> about their policies so _______developed a video, which is

> introduced

> by ________(President of the NEA), to help educators understand

> their

> policy better. The video runs around 8 minutes and can be shown at a

> meeting. I only ask that I have about 5 minutes before, or after to

> tell a

> little about ______and myself.


> I'd like to set up a time that I can stop by and discuss this

> wonderful

> opportunity with you. Please let me know how your calendar is looking

> this

> week.


> Thank you for your cooperation, I look forward to meeting with you.




MY not-so-polite response


Hi ______,


I'm a straight shooter so I'll get right to the point. Whether it is

pizza, shrimp or a video, you are eventually trying to sell an annuity

product to the teachers. The annuity product, if you combine the actual

fund expenses with the other insurance fees (all of them ) the total

cost is usually 2.5-4% of assets under management. The products usually

have a surrender fee that adds insult to injury. A 3% fee (total)

reduces the net result by 45%. Teachers who have only $13,000 to shelter

as absolutely best served by the 457 with the newly added Vanguard

index funds. There are also other choices. If they have more money then

they should do a Roth with Vanguard, Fidelity or and other low cost

provider with access to real mutual funds, not shadow funds. Do you

have any products that have a total cost of less than 50 basis points

(including annuity fees AND fund expenses)?


That's the issue, so I welcome your response.




Share this post

Link to post
Share on other sites

Great post, Gadfly, and I absolutely love your response.

My only recommendation is to also send this to the President of NEA, National Teachers Association.

I have just finished a lengthy letter, too long to post here, to my own union president, UTLA, about 403b and other issues.

Keep up the fight!


Share this post

Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.


  • Create New...