By: Daniel ChencloseAuthor: Daniel Chen
Name: Daniel Chen
Member: Member Paladin
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Email: dcstrategies@yahoo.com
Site: http://paladinregistry.com/external/beaninformedinvestor/advisor_profile.php?advisor_id=1893
About: Dan's specialty is delivered by his Wealth Management Practice with a core competency in Fianancial Planning. The ability to deliver services for a fee eliminates the potential conflicts of interest created by the commission only type of aproach. He maintaines his office in Ocean N.J. however serves a clientel base from coast to coast. Dan believes that the basis for a great life is planning for it. Dan offers a no obligation meeting to decide if his services are appropriate for your needs.See Authors Posts (10) | May 14, 2009 | Bad Products & Services, Financial Advisors, Investment Performance
This is one issue that is being raised more and more as investor’s lack of confidence in the markets become more apparent. Or is it because advisors are losing confidence in their traditional investment solutions? Most advisors have only experienced a bull market, as a result, there is this belief that markets will only go up, or, if they do go down, it will only be for a brief period [shape recoveries]. Look, the last 9 months have put us all on edge as well as second guess the investment strategies that we as advisors have offered our clients. However, as demanding as it has been there is no reason for us to hit the panic button and look for the simplest solution as an easy way out.
Now don’t get me wrong. I most definitely believe that there is a place for variable Annuities and all the great benefit riders that they offer, however the question is at what type of cost, limitations, and parameters versus the benefits that are being offered.
There are some very good benefits out there, and in this ever changing and unpredictable world we live in it is nice to have something that you can count on as a guarantee. I think the questions are, who is guaranteeing this, at what cost today versus the maximum cost they can charge in the future as well as the strength of the organization backing up that guarantee.
Right now I am experiencing too many advisors convincing their clients and prospects that this is the only solution. Instead, these advisors should be doing what they are paid to do. Offer clients a review of their financial plan to make adjustments today to reach their goals for tomorrow. Offer them a diversified solution of tactical versus strategic allocations along with the concept of absolute returns versus relative return discussions.
Lead our clients through these difficult times by clarifying the day to day events. [Lawmakers, regulatory body, fed policy activities] and how they are expected to work, instead of feeding into their fear. Given the internal cost of these contracts and the potential secular bear market we could be in, one could be on a treadmill of returns that will never get them any further then when they first started.
We as advisors are leaders. We need to walk investors through the process of what is going on today, provide ongoing solutions and give them options through education in order to instill the discipline that they alone do not have when it comes to this topic in their lives.
