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Guarding Your Wealth for Senior Citizens
Daughter’s Sad, Disgusting Tale of What Happened to
Elderly Father's Money
'What really hurt… this broker pretended she really
cared about my father’
By Jeffrey D. Voudrie, CFP
 Nov. 1, 2007 - I receive quite a few emails
requesting free financial advice. Often the questions are fairly
routine, but a few share heartbreaking stories of investors who are
trapped in difficult situations. In this case, the writer was glad to
have me share her story, in hopes that it would prevent others from
repeating the same mistakes.
Phyllis, (not her real name), contacted me recently
about some concerns she had about her elderly father’s finances. “I
asked him if he had any money in a certain type of investment. He told
me he didn't think so. Turns out he did.
About a year ago he went to his bank because a CD
was coming due. The teller told him he had a lot of money and he should
talk to someone at the bank who could get him more money than CDs.
“He was then introduced to someone he thought was a
‘banker’ but was in fact a broker with the bank’s investment services
company. He took the ‘banker’s’ advice and invested over $150,000 into
this high commission, 10-year investment. He was 85 years old!
“He was told that the money was safe and it could
be made available to him anytime he needed it. He was not told of
surrender charges, commissions and fees. He didn’t understand that the
risks were much different than those associated with a CD.
“He really liked the ‘banker’ and would visit her
when he went to the bank. He said she gave him a mug, some pens and two
sweatshirts. Soon after, he withdrew all of his other monies ($170,000)
so he could "consolidate" all of his investments with her per her
advice.”
With further investigation, Phyllis discovered that
this ‘banker’ had invested 90% of her 85 year-old father’s money into
variable annuities. Now 90% of his money was in the stock market! When
the penalties on one annuity were over, she had him roll it to another.
When she went to work with another bank, she had him transfer his money
there, continuing to tap all his available assets.
Phyllis also discovered that the banks this broker
worked for were heavily fined by the state for selling annuities to
elderly investors, like her dad. This had been big news in her area, and
once Phyllis realized her dad had been a victim, she contacted the state
for help.
But unfortunately, her dad had purchased his
annuities just outside the time that the fine covered, and he could not
get a full refund of his money.
She has contacted the banks in question, and while
they agree with her that putting an 85 year old into a variable annuity
is inappropriate, they just keep passing the buck. There’s been an offer
to reduce the surrender fee by half, but that’s far short of full
refund. T
he broker hasn’t been fired, and her father’s
annuities won’t come due until 2015, when he’ll be 95 years old. Until
then, he’s living on $15,000 from his pension and Social Security.
“What really hurt and repulsed me,” explains
Phyllis, “was the fact that this broker pretended she really cared about
my father. He thought they were friends. He shared all of his
financial information including banks and bank account numbers, CDs,
etc. Information which he never discussed with any of us kids. So she
actually knows more about my father’s finances than I do. She taunted me
on the phone about that.”
“He thought since she was all dressed up and
working with the bank, that she was intelligent and could look after his
money better than we could. He thought she was actively managing his
money daily.”
“Tell your clients to share their financial
information with their child. Their children may not have the financial
background but they care about their parents. My father is a living
example that these banks are continuing to target seniors [for what many
consider inappropriate investments].”
Seniors beware.
You can’t trust someone with your money just
because they work at a large bank, dress nicely and give you a free mug.
These people are trained to gain your trust,
uncover your assets, and earn as much commission off of you as possible.
Not every ‘bank broker’ operates this way, but many do. Skepticism is a
healthy thing!
If you have a specific question or would like more
information, give me a call toll-free at 1-877-827-1463 or you can also reach me by email at
jeff@guardingyourwealth.com.
I will answer your financial question FREE.
About Guarding Your Wealth:
“Guarding Your Wealth” is a
nationally syndicated weekly personal finance column written by Jeffrey
D. Voudrie, CFP. Mr. Voudrie is the President of Legacy Planning Group,
a private wealth management firm that employs sophisticated proprietary
strategies designed to protect and grow its clients' investments. Visit his website,
www.guardingyourwealth.com to read past articles under the Guarding
Your Wealth Article Archive that may not have appeared in
SeniorJournal.com.
Guarding Your Wealth for Seniors, on
SeniorJournal.com, is
a collection of columns by Voudrie that deal with issues of particular
interest to senior citizens.
Click here
for all columns.
In addition to being a nationally
syndicated columnist and Certified Financial Planning Practitioner, Mr.
Voudrie provides personal, private money management services to select
private clients
nationwide.
Looking for an energetic expert who
is passionate about financial and wealth management? Mr. Voudrie is an
excellent speaker who will excite and inspire your audience. Mr. Voudrie
is available for a limited number of speaking engagements, television
appearances and radio talk shows. For bookings, email
jeff@guardingyourwealth.com.
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