You wouldn’t believe some of the crap I get in the mail. You really wouldn’t.

Here’s an example of something I received just the other day from We The People, Inc.

I’m not familiar with this company whose website describes them as “a charitable non-profit corporation“. However, after reading a little more about them on their site, I can actually imagine where they might have a role in someone’s charitable giving or estate planning.  This isn’t something I would ever utilize for my clients, but I understand to potential value of the concept they employ.

What really rubs me the wrong way is the “7% Commission” that is highlighted with a gold star.

Imagine this . . .  

Your advisor is working with you and perhaps your estate planning attorney.  Your advisor sold you an equity indexed annuity a few years ago and has staunchly defended  their recommendation ever since.  But either at your request or the suggestion of the estate planning attorney, it’s been concluded that you would benefit from making a charitable gift. Do you think this 7% Commission might come into play?

For your sake, I sure hope not.  But what if your advisor is involved and stands to capture a $7,000 commission on your $100,000 annuity exchange. Do you think the advisor might have some incentive to steer you toward this or a similar vehicle vs. a strategy that doesn’t involve a commission?

This is just a warning for those of you working with advisors that accept commissions (most do).

Many commission-based brokers are honest and ethical, and I would trust them with my own money. Conversely, there are fee-only, or non-commission based, advisors that are dishonest and crooked to the core.

What if you’re the unlucky customer of a less-than-ethical commission broker that has recently experienced some tough financial circumstances.  What if the 7% commission on YOUR money is what allows he or she to keep their home or maintain their employment?  This can happen. I’ve seen it.

I’m a fee-only, fiduciary advisor, and I do not accept commissions.  And while this fact alone doesn’t mean I’m the advisor for you, at least you don’t have to worry about my advice being influenced by anything other that your best interests.

Can your advisor say that?