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All products net good and bad press, but why?

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All too often, clients and prospects are given negative information by their current advisor, or perhaps they stumble upon information on the internet about a given product. The problem here is that people tend to believe that if it’s in print, it’s legitimate. Moreover, if you want to support your belief in something, you can always go online and find “proof” to support it.

Rather than getting emotional and trying to “confirm” what is right and what is wrong, why not have an open mind and look at the facts to help us make decisions?

When your clients and prospects get third party press – for instance, something indicating “Annuities are bad” – how should you respond? Should you open up your desk drawer and show them all the great articles written about annuities? Let me first say that I do think it’s a great idea to have positive third-party press. But why not help the client see and understand things in a logical way as opposed to an emotional way. Why not go “big picture” with your clients, helping them see what’s really going on and why these articles are really being written?

The truth is, there is a war going on in the financial world, among Wall Street, banks and insurance companies. Why? Because they’re are all fighting over the same money. The majority of America’s wealth rests with the boomer and senior generations, and virtually every major financial institution is fighting over this money. The press willingly jumps right into the fray to cover the action. When you see an article that’s particularly negative on a given product, stop for a moment before digesting everything you’re reading, and simply ask, “Why is this really being written?” Oftentimes, the answer is obvious.

The truth of the matter is that in most cases, when a particular financial vehicle, such as an annuity or mutual fund, is receiving negative press, the product is often not the real issue at hand. The press is often condemning the manner in which the product was sold.

In the case of fixed annuities, for example, the fact is, there are more than 1.2 million individuals in the United States licensed to sell these products. The training to become licensed is often a three-day class and two-hour test. That’s it.

The point? Many of these people did not know the products themselves (though they may have genuinely thought they did), and if they didn’t know what they were selling, their clients couldn’t have known either. The true experts who understand this business and understand how products work know which products are best, where they fit into a client’s portfolio and how they help clients reach the outcome they desire. Clients who are with this type of advisor often become raving fans in the end.

Help your clients remember: The motives of anyone bashing a particular financial vehicle are suspicious by definition. All products have a designed purpose and are built to address a particular need. In that sense, such blanket criticism of a product would be no different than someone offering general criticism to a particular medicine such as penicillin or ibuprofen. Misapplied, any medication could be dangerous, but when used to treat the needs for which it was designed, it’s just what the doctor ordered.

Shawn Sparks is an annuity consultant with Advisors Excel. He can be reached at

For more stories on annuities, see:

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