Avoid Conflicts of Interest: (as much as you can)
1. Anyone can be an "Advisor":
As there are few requirements most using the term or some form of it
today were insurance salesmen, stock brokers or in the financial field.
Some were attorneys, others accountants and still others with backgrounds
in many unrelated fields. Ask about their background.
Recently I saw a magazine called Retirement Advisor
mentioned regarding an advisor of the year contest. I looked into it as I had
never heard of that magazine before. As it turns out it is owned by
life/health/pro.com and setup to provide sales tips and stories to those in the
insurance business. In order to be considered for their advisor contest
one had to have sold a "minimum of $5 million in annuity/life insurance
Like I said, anyone can call themselves an advisor.
2. How does the firm get paid?
You need to find out.
3. Products with different payouts for the salesman:
Do they have these?
4. 3rd Party Wrap Accounts or Advisors that don't Advise:
Why pay someone 1% a year just for leading you to
someone who will do the work?
5. Insurance Product for your IRA?
Your IRA already has tax benefits. Some annuity
products can be useful however ask about all gains being taxed
at your ordinary income rates, what "LIFO" means and what
happens to your
step-up in cost basis?
6. Hidden Huge Fines Against Investment Firms:
Ask if the firm has had or ever had fines levied against him or her
or them. If you don't think they can be substantial just go online
and take a look.
Often they are in the millions or tens of millions!