Last week on HBO’s Last Week Tonight with John Oliver, John Oliver thought he would get cute and tell you why you are getting screwed by Financial Advisors. http://bit.ly/25Ytdwj I have attached the article if you want to see what sage advice he attempted to give you. It’s ironic as I just completed 25 years of doing this as a profession and continue to witness the misinformation and disinformation that goes on within the financial services industry. Every person with a laptop and a blog can tell you about the right way to manage their money.
Talk show hosts are more than interviewers today. They see their shows as a podium to help influence political, social and financial change across our country. Oliver’s comedic commentary has been credited with helping influence US legislation, regulations, court rulings and other aspects of US culture, which has been dubbed “The John Oliver Effect.” This came from the show’s fifth episode, which focused on net neutrality, a subject that had previously been considered obscure and technical. (source: Wikipedia)
So, what exactly did John Oliver say that was so WRONG?
The first point of contention is that he claims financial advisors aren’t accredited. Today, there is plenty of information to determine if your financial advisors have the appropriate licenses to be able to give you advice on all and any products and services that are out there in the marketplace. You should ask if your advisor has a series 7, a series 63,65,66, and/or a life and health insurance license. If your advisor only has a series 6, they personally will not be able to sell individual stocks or bonds to you, so the likelihood is that those are not recommended. In addition, advisors can earn a very difficult accreditation called a Certified Financial Planner™ designation, which in my opinion, is the premier designation for a financial advisor. These are easy things to find out when you hire an advisor.
What’s interesting around Oliver’s second point, is that he makes a sweeping generalization that advisors only recommend certain products because it’s where they make a higher commission. When was the last time you saw someone who works for a Ford dealership sell Chevys? Why do doctors often recommend only one kind of pharmaceutical company? Why do people that own a nutrition store often recommend one kind of protein bar or supplement? The truth is Mr. Oliver comments mostly focus on investments and don’t really take into effect the many advisors who give quality financial advice, business advice, career advice and much more that often goes uncharged to clients and bled into the ‘money management’ fees as part of the deal. The reality is that financial advisors have one of the hardest jobs of trying to help consumers separate church and state when it comes to investment management and financial advice.
Oliver then enlists Billy Eichner to share good financial tips to help you with your future. In fact, what’s funny is that Oliver says you should NEVER take advice if someone isn’t a fiduciary. Last I looked, neither Oliver nor Eichner are a fiduciary. So, nice job gentlemen, according to your own advice no one should listen to you. The worst part of your advice is to just leave your investments alone. I believe it’s important that you rebalance your assets because the mix you put your investments into will change over time and you should be rebalancing to get your mix back into shape.
I’m baffled at how so many people today who have never done this as a profession or really know what the profession is about, give advice to people in a callous way on television and the internet. It’s amazing how other professionals are never attacked such as CPA’s, attorneys, mortgage brokers, but financial advisors seem to be the one soft spot that everyone thinks they know better.
Ted Jenkin is a frequent guest columnist for the Wall Street Journal and Headline News Weekend Express. He is the co-CEO of oXYGen Financial. You can follow him on LinkedIn @ www.linkedin.com/in/theceoadvisor or on Twitter @tedjenkin.
Securities offered through Kestra Investment Services, LLC (Kestra IS), member FINRA/SIPC. Investment advisory services offered through Kestra Advisory Services, LLC (Kestra AS), an affiliate of Kestra IS. oXYGen Financial is not affiliated with Kestra IS or Kestra AS. Kestra IS and Kestra AS do not provide tax or legal advice.