Valley Sentinal – May Issue

Four weeks ago I received a call from one of my client’s closest friends. She wanted to interview me and see if I could help her in the same way that I’ve helped her friend over the years. I agreed to meet with her and asked her to bring in her tax returns and copies of any recent investment or retirement account statements she had received.

Two weeks later when we met I was shocked to find out that this person owned 11 annuities and 6 non-publicly traded REITs (Real estate investment trusts). I asked her how it came to be that she had invested such a large percentage of her net worth in these illiquid products and she said her financial advisor of 20+ years had recommended them. This woman knew that she had a financial advisor who focused on product and not planning and that’s why she made the appointment with me in the 1st place, but she truly had no idea just how bad the advice she’d received over the years had been. In fact, she was ready to admit that though she signed reams of paper before investing in each of these, she never really understood what they were or how they worked, but she trusted her advisor.

Unfortunately these stories are all too common in a world where financial advice is often “free” as long as the person giving it can get paid by the company whose product they are pushing. While I do not in any way blame this woman for not knowing, I asked her how much do you pay your advisor every year and she said “I don’t, I assume he gets paid by the insurance company but I have no idea how much.”

Given that this happens all too often, I can completely understand why people are so reluctant to meet with a financial advisor for the 1st time. It’s the same reason I hate going to the car dealership.

The good news here is that this story has a happy ending and it’s emblematic of the changes that are occurring in our industry today. The #1 question prospective clients ask me has changed over the years. It used to be “what’s your minimum” or “how do you invest client money”, now it’s pretty consistently “are you a fiduciary”. I am proud to be able to answer this in the affirmative and hopefully start every relationship on a solid foundation.

Today this client and I and are working with the insurance companies whose products she owns to figure out how/if we can unwind some of the ones that she never should have bought in the 1st place.

If you have a bunch of accounts/products you’ve bought over the years and want a second opinion, or have been too scared to meet with a financial advisor (and justifiably so), give me a call or send me an email: 925-927-1900 or

Robert Cucchiaro is a Certified Financial Planner and owner of Summit Wealth & Retirement, a financial planning firm that has been serving Danville for over 30 years. Rob specializes in retirement, investment, tax, and estate planning. 

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