Financial Planning Services – Avoiding a Bad Experience

Financial planning services come in a variety of packages. My goal with this article is to help you find the right person who has your best interest in mind. This is the story of how a very disappointing experience can turn into a real blessing.

Years ago as a young married couple, we received an invitation from my wife’s employer. We were given the opportunity to meet with a “Financial Planner” to go over our income and provide guidance. Being that we felt completely clueless when it came to planning and investing, it sounded like a great opportunity. We eagerly booked the appointment and looked forward to getting the direction we sorely needed.

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Getting Started With the Process

The initial appointment was complimentary so we felt good about the meeting. It was held at the same building where my wife’s company was headquartered, so we that added to our comfort level. After years of confusion and worry about investing, we felt like this was our opportunity to take control of our financial future. It was so reassuring to get the services of a true professional in the financial planning services industry to give us guidance.

We met with the “planner” (the quotation marks mean a lot – you will see) and she was a very pleasant woman. She made us feel welcome and attended to us throughout the presentation with water, cola, and coffee. She listened very carefully as we explained our financial situation and desire to maintain firm control over our financial future. My wife and I had recently paid off a large sum of credit card debt I accumulated prior to our marriage. We felt extremely proud of doing so on a limited budget since my wife did not work for the majority of our first year of marriage.

The Road To Success!

We both felt comfortable throughout the discussion, so naturally the meeting led to considering our next steps. The “planner” told us that with our resources and income level, she could compose a thorough and comprehensive financial plan for the price of only $300. For a young married couple, that was a lot of money, especially one that was still digging out of a financial hole. However, we thought it would be a small price to pay for professional advice and direction that we sorely needed. This was just what we needed in order to take the next giant step toward financial fitness.

We knew that it would take a few weeks to formulate the plan, so we made our next appointment and looked forward to the meeting. For years I had been interested in learning about investing and financial planning, but really had no idea to start. I was intimidated by the stock market and did not understand much about products from the financial planning services industry.  I was really excited about receiving the financial plan. My wife is not interested in finances like I am, so I have handled everything since we got married. I have always felt a responsibility to make good decisions and use our money in the best way possible. This was going to be a turning point for me – I just knew it.

Financial Planning Services – Avoid the Full Court Press

The tone of the second meeting was much different than the first meeting. From the minute we arrived, it felt a lot like being in a car dealership showroom. The room was the same, the water and cola were still cold, but this was different. The next 60 minutes would be the most intense sales meeting I have ever endured. My wife and I are both turned off by really pushy sales people (as I am sure you are), so within 5 minutes we were ready to hit the door. However, this was the meeting I had been waiting for. I was ready to take things to the next level, so in the back of my mind I was hoping this was just a part of the process and we would get to the important stuff I was looking forward to.

As the meeting progressed, it was clear this was a sales meeting packaged as “financial planning”. Even as complete novices, my wife and I could smell it. We were wondering if the “planner” even listed to us during the initial meeting. I thought we had discussed our desire to pay off our house aggressively, yet she strongly recommended we get into an interest-only mortgage. Both of us discussed our nervousness about stocks and our general lack of knowledge, but she strongly advised we invest in three “can’t miss” funds their company sold.

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Don’t Forget the “Can’t Miss” Stock

She also advised we invest strongly in the company stock since they were on the road to tremendous growth. This was right after the 2002 stock market dot-com meltdown. I had worked for a “can’t miss” company that was on the verge of being sold for pennies on the dollar. I had stock options from the company when I left for $48 a share. The stock was going for less than $2 a share by 2002. I guess I knew more than I thought. I had no intention of investing in a company I knew nothing about.

A Race To The Exits

Even though we were strongly advised to sign everything that evening in order to initiate the plan, my wife and I both felt the same at the conclusion. First off, we could not wait to escape that conference room! Second, even though we did not understand everything, we knew that this was someone we did not want to do business with. Sure, we had sunk $300 hard earned dollars into the “financial plan”, but we both had such a bad taste in our mouth we decided there and then on the ride home to cut our losses.

Financial Planning Services - Avoid Getting Burned

Curiosity Got This Cat

As the weeks passed, my curiosity and lack of confidence got the better of me. I kept looking at the attractively packaged “financial plan” and decided to look closely at the recommendations. I was going to attempt to educate myself just in case we were making a mistake. Maybe she just knew a lot more than we realized, and we should reconsider. I thought that perhaps the financial planning services industry is like any other sales industry. It was possible she was doing what she was suppose to in order to close a client.

Thankfully, it did not take me long to understand what we were presented with. The interest-only mortgage was garbage, and it said right in the plan why we should go that route. It was so that we could save a few bucks on our house payment and use even more money to invest in the mutual funds she was offering.

Now it was time to understand the mutual funds. I knew it was a group of stocks pooled together to help manage risk, but that was the extent of my knowledge. As I did my homework on the internet, I realized that these funds were some of the worst rated ones on the market. They also had an extremely high “load” fee. I figured out that the load fee was the money that came off the top and went to the company. It’s a shock to realize that the “planner” will make big money off the commissions. Was this how true financial planning services really should work?

Shredder Food Tastes Pretty Good

The biggest mistake I then made was out of anger and frustration. I tore the book apart with the plan and proceeded to put it through our shredder. Looking back, I really wish I would have kept it for reference. Being that it was such a watershed moment in our financial lives, it would have been an important piece of history to retain! However, the $300 spent and that fancy binder full of shredder food turned out to be a huge turning point.

That was the moment I became determined to learn everything I could about the financial planning services industry. I wanted to make decisions based on accurate knowledge and our circumstances. It was when I realized that I wanted to take control of our financial future and discover the best way to save and invest. I knew that winning was possible – I knew too many people that were successful. There was no way it had to just be an endless stream of high pressure sales meetings and investing in products I did not feel good about.

Financial Planning Services – Let The Journey Begin

That was the moment that led to me becoming a personal finance nerd. Since I had the strong desire to serve others, it also led me to learning about the fee-only financial planning community. I learned about the word fiduciary and how that meant you always look out for peoples’ best interest. You work to match them with products that suit their goals, circumstances, and personality. There is a huge community of people throughout the profession that truly want to help people. They love helping people start the journey to financial independence. That inspired me to go back to school, become a planner, and start my own business. It has been hard work and it takes time but it has been so worth it.

Trust Your Instincts

My advice is to trust your instinct and run away from anything that feels like a total sales pitch. We are all in sales to a degree, but people who truly want to serve you will make you comfortable. They will not try to sell you a garbage financial product. As a fiduciary fee-only planner, my goal is to serve clients, educate them thoroughly,  and get them on the road to success. However, if things do not work out for whatever reason, I will even help them find someone. That is how things should work in the financial services industry. I care about people and want them to win. Any investment strategy you get should have your personal circumstances clearly in mind.

Financial Planning Services – Find the Right Person for YOU

Many of you are starting the journey and taking in knowledge about money. You may feel intimidated and scared about the stock market and investing. You may even encounter a “planner” who is just a sales person and wants to close a sale.  This goes for insurance, investing, and any other financial products. Please know that there is a large community of professionals in the financial planning services industry that have your best interest in mind. There is a marvelous personal finance community online full of people that had similar experiences to mine. Their advice and inspiration can be hard to quantify with a dollar value. Never give up on your quest for accurate knowledge and finding the right products for you.  It was hard to waste $300 on shredder food, but it ended up tasting really good in the end!


4 thoughts on “Financial Planning Services – Avoiding a Bad Experience”

  1. Some lessons must be learned the hard way I suppose. I think that $300 “wasted” money allowed you to gain valuable knowledge. In the long run, it is the best wasted money ever.

  2. The fact that you and your wife had the wherewithal to walk away from that pushy sales pitch is no small accomplishment. Many people would be afraid to chalk up that initial $300 as a sunk cost and they’d hang around trying to ‘get heir money’s worth.’ Thank goodness you guys trusted your instincts! Sounds like a life changing moment and you made the right choice!

    Cato @theDollarBuild

  3. Great article. Reading through it reminded me of how I felt when going to sales pitch for time share when you are on vacation. Why would you make a huge 100k investment within minutes of listening to the sales pitch? Great work on using that moment as a turning point!

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