By: Matthew Arndt, CFA, CPA, CFP | July 22, 2009 | Annuities, Wall Street Ethics

When I first entered the investment advisory business I promised myself I would not reduce myself to being a commission sales rep and sell trash to investors even if I were dying of starvation.

The proliferation of new ways to package and repackaged garbage in the form of fixed annuities, variable annuities, equity-indexed annuities, and structured notes is astounding to say the least. How any investor can distinguish and compare the plethora of products is beyond me. I even question whether many of these sales people have the aptitude to compare and understand these products or whether they even care at all considering they have such a potent incentive (e.g. large commissions) to sell them. It all appears to be gimmickry; another way to fleece investors of their savings with sales products that carry steep commissions, excessive internal fees, and exorbitant surrender charges.

Following the recent financial meltdown, sales reps preying upon investor fears are marketing many of these products as safer alternatives and enticing investors with an initial "bonus credit" feature which will be accompanied by higher expenses that can outweigh the benefits of the bonus.

If you find yourself in a conversation with an adviser trying to sell you any of these products ask yourself what’s in it for the “financial planner.” Do yourself a favor by making a quick exit; tell him you have an appointment to make. Just remember these are great products for enriching the sales rep.