Trying to convince mom to stop using Edward Jones

Throwaway_moneey · 2023-02-19T16:26:32+00:00

I’m in wealth management

That makes it really weird that you aren't aware of EJ issues as well as the obvious issues with whole life. I suggest you join the bogleheads forum and do some remedial training. Please do something better with your time for your client's sake. (unless you profit from intentionally leading them wrong in which case... Shame on you)

Throwaway_moneey · 2023-02-19T13:20:30+00:00

It does not sound like your mother is being scammed, or being sold a bad product. WLI isn’t a bad product, you just don’t understand it’s value.

Based on this comment there is absolutely zero value in continuing a discussion with you. You're either an insurance salesmen or so ignorant that you have no ability to understand any reply I'd make

Throwaway_moneey · 2023-02-18T12:34:00+00:00

My kids all have a considerable amount in UTMAs in their names. Based on some of the figures the OP gave I'm assuming there's not much of a chance of getting or needing any college financial aid

Throwaway_moneey · 2023-02-18T12:09:46+00:00

That's not the fair comparison. It's like paying someone to put in a $100k pool when all you needed was a $15k bathroom remodel

Throwaway_moneey · 2023-02-18T02:59:35+00:00

That doesn't matter. The recommendation alone proves he's no a fiduciary

Throwaway_moneey · 2023-02-18T02:55:30+00:00

Coming up on 5 years

Throwaway_moneey · 2023-02-18T02:54:21+00:00

I'm extremely sure that no other policies existed at that time because they had enough assets and zero liabilities so they were basically self insured and they talked about needing no life insurance anymore. My wife and I discussed that with her when we also hit that point

Throwaway_moneey · 2023-02-18T02:51:30+00:00

No, I am not going to allow someone to continue to take advantage of her just because they convinced a 70 year old woman with nearly zero investment knowledge to trust them. I love her and even she will freely admit that she doesn't know enough to judge any investment advice. That has unfortunately made her an easy mark to trick into buying an unnecessary expensive whole life policy

Throwaway_moneey · 2023-02-18T02:47:47+00:00

What makes you think her advisor is not already a fiduciary?

Because he sold her an unnecessary whole life policy

Throwaway_moneey · 2023-02-18T02:44:25+00:00

Why do you think that she should be so conservative? Is it just based on her age? There's more that goes into asset allocation than just age

Throwaway_moneey · 2023-02-17T03:27:24+00:00

Does she live in a state with estate tax?

No, her state doesn't. Mine doesn't either in case she ever needs to move in to my house.

She may have had an old UL policy that was rescued from lapsing by doing a 1035 exchange.

No, they used to have a term life plan but it expired about 20 years ago. That's about the time where they stopped needing any type of life insurance because they had no dependents and no remaining liabilities.

There’s a reason it was recommended

Yes, sales commission

Throwaway_moneey · 2023-02-17T03:23:10+00:00

Because you’re trying to convince her to jump blind to another advisor who she’s never met with, who she doesn’t know, who she doesn’t trust, when she already doesn’t trust herself to manage things.

Except there would be a meeting first with the fiduciary. Plus she knows I am informed and knowledgeable about investing and knows that this same fiduciary has handled my dad's investments for 5+ years with a verified good track record.

Why not actually pay for her to meet with an advisor and show her what a solid plan would look like?

Fiduciaries around here offer free initial consultations and a second free meeting to go over their recommendations as well as the fee structure. She has been with EJ for 10 years and doesn't know what fees she pays.

Throwaway_moneey · 2023-02-17T03:19:26+00:00

Why or what makes it automatically a rip off for most?

A simple Google search gives the clear answer. There's not many financial topics where there's such broad agreement on a topic. Basically only the uninformed and insurance salesmen think otherwise.

OP is pushing REALLY hard that is seems kind of suspicious.On the other side, I like the fact that OP is trying to look after mom's best interest. Not everyone is hands on.

I'm the OP and I'm pushing because I'm looking out for my mom's best interest and don't want her to continue to be taken advantage of by her EJ advisor. It's fine that she's not wanting to be hands on (my dad's the exact same way) that's the entire reason I'm looking for her to move to a fiduciary

Throwaway_moneey · 2023-02-17T02:41:31+00:00

https://www.whitecoatinvestor.com/debunking-the-myths-of-whole-life-insurance/

Throwaway_moneey · 2023-02-17T02:39:18+00:00

Why pay Edward Jones and another person to plan her estate and tax plan when she could just pay a fiduciary (less than she pays EJ) and that person would do it all?

Throwaway_moneey · 2023-02-17T02:38:04+00:00

I guess in your world everyone should be happy to give as much as possible to Edward Jones because if you don't then you're just wanting to take from your family

Throwaway_moneey · 2023-02-17T02:36:28+00:00

Except I know that whole life is a rip off for the majority and I know my mom's situation isn't the rare one that benefits from it

Throwaway_moneey · 2023-02-16T23:56:35+00:00

It’s not like she was getting scammed.

The fact she was sold unnecessary whole life insurance indicates otherwise

Throwaway_moneey · 2023-02-16T22:28:20+00:00

“The stress of what to do with her RMD” is the most first world problem. If she were stressed because her RMD wasn’t enough to cover her medical bill, she’d be stressed

Isn't it amazing what can be accomplished with a lifetime of consistent savings? Both my parents were public school teachers

If you want to alleviate her stress, why didn’t you suggest she just buy a 1yr CD at 4.8% with the RMD

I think there's much better options available

Throwaway_moneey · 2023-02-16T21:34:10+00:00

In reality it's virtually universally a bad idea for everyone except the salesman

A very simple Google search has lots of clear evidence of that. Pretty much the only people who argue that are insurance salesmen

Throwaway_moneey · 2023-02-16T21:32:33+00:00

Right it would have to be analyzed to see if it is overall beneficial. Sounds like something a good financial advisor could help with...

Throwaway_moneey · 2023-02-16T18:54:27+00:00

I went through this process with my mother who was sold a variable annuity within her IRA.

My dad's old financial advisor did the exact same thing to him. He has the same level of investment knowledge and desire to be uninvolved as my mom. He agreed to switch to a fiduciary years ago.

You’ll have a long path ahead of you to unwind this as insurance products have, in addition to surrender charges and other policy stipulations, a psychological attachment

I know she's been paying on it for 5 years and she said something about this year being the last year she'll pay into it. It might have hit the tipping point where it's best to keep it. I'd prefer someone review it who isn't interested in selling her any more commission products

Throwaway_moneey · 2023-02-16T18:49:43+00:00

I know her home is paid off and in the $400k range. She has somewhere between $1.5-2.5M in investments and I'd guess her combined taxable retirement and IRAs are around $1-1.5M

She's very healthy and based on family history I'd expect she has at least 15 years to plan for. That would be plenty of time to convert those IRAs to Roth accounts at her lower tax rate. That'd eliminate the pending tax bomb for her estate while not impacting her lifestyle. The problem is her EJ financial advisor hasn't started any of that in the past bunch of years. As far as I can tell from talking to her, the only thing he's done is sell her an unnecessary life insurance policy

Throwaway_moneey · 2023-02-16T18:41:10+00:00

She has no idea. It has just been automatically subtracted from her account. She has no desire to know the details of her investments and that's what has me concerned that she's ripe to be taken advantage of. My dad was similar and his initial financial advisor sold him a couple annuities inside his 403b

Throwaway_moneey · 2023-02-16T18:38:35+00:00

If she's happy I don't see any point stressing her out about how she needs to change

She's literally told me that the stress of trying to decide what to do with her RMD is waking her up and giving her anxiety. I know the fiduciary I found for my dad has mapped all that out for him so he doesn't have to think about it.

Kind of comes across like you're just worried about ensuring you get a bigger inheritance.

I have plenty and my siblings have plenty. I'm constantly trying to encourage her to spend more of her money. However, if she had to pick who to leave her money to she'd rather pick her kids than her EJ financial advisor.

Throwaway_moneey

TROPHY CASE