As a commission-based advisor, I'm feeling a bit attacked here. Obviously, we're not all alike, and some valid points have been raised here. But, bottom line is this--all advisors, fee-only or commission-based, will only survive in this business by meeting our client's needs and gaining their trust. Those who consistently put their clients into inferior products will generally not last. So, perhaps longevity is one criteria to use in selecting an advisor. Another is whether they have professional designations (such as ChFC, CLU, CFP, etc.), as this indicates how serious and committed they are to a long-term career in financial services. Best of all, though, is to work with someone you know personally and trust, or an advsior who was recommended to you by a respected and credible friend. If these criteria are lacking and you are still skeptical of the person sitting across from you, then perhaps it is best to move on.
None of us advisors expect to have a perfect batting average. We lose many prospective clients to no-load funds or simply to procrastination. We are well-aware that we run the risk of giving away our advice for free on the hopes that we get paid for it later. So don't feel too guilty about "snubbing" an advisor (unless you intended from the beginning to waste his/her time), but also don't expect much from said advisor in the future.
As for annuities in retirement plans, this is a controversial thing. I am not advocating it, but I can think of a few legitimate reasons why a paid advisor may recommend one:
-Annuities have no front-end loads, and there are now "bonus" annuities that actually PAY the investor 4-5% on all deposits.
-True, annuities have higher annual expenses vs. mutual funds to make-up for the above bonus and no load, but part of those expenses are for guarantees which, in today's down market, are now highly appealing to some investors.
-Maybe one already has a lot of mutual funds, and this further diversifies their portfolio.
Flame me if you must, but I think we can agree that you can not always say that one type of advisor is better than another. I'm just providing some food for thought.
[This message has been edited by Dopps (edited May 29, 2003).]
[This message has been edited by Dopps (edited May 29, 2003).]