Annuities

[Dusty2004]

In PA

I'm not shy about telling them what I would do.

And I'm not too concerned about them regarding it as advice because they never do what I say anyhow. Most of the time they're just looking for validation of something they've already decided to do.

If you give investment advice in PA you are breaking the law. You are not an RIA and cannot give advice. Call it what you will saying you would invest in an index fund or CD or to cash in the savings bonds is giving advice. You can tell them what the tax implications are, but not advise them to take one path or another.

Dusty

[JohnH]

Interesting.
Would I be running afoul of the law in PA if I simply told them how I'm doing it? (Which is what I often do, BTW).

[Dusty2004]

Good question

Interesting.
Would I be running afoul of the law in PA if I simply told them how I'm doing it? (Which is what I often do, BTW).

I will have to try and find out and let you know.

Dusty

[Roberts]

I will have to try and find out and let you know.

Dusty

As long as he isn't selling securities, taking orders or instituting orders, as an accountant he's exempt from licensing. As a part of his job as a tax preparer / planner, securities advice is exempt because it's part of his job. Same goes for journalists and professors.

[JohnH]

So I'm OK if I tell them the following:

"Don't gamble.
Find a stock that's going to go up, take out all your savings, and buy as much as you can.
When it goes up, sell it.
If it don't go up, don't buy it in the first place!"

(my apologies to Will Rogers for the paraphrase)

[Roberts]

I'm sorry, but I must say Annuties are a problem out there because many of the Financial persons are awarded hugh commissions, and thus they are very aggresive in selling them. How can the financial planner be without bias when such a large commission is being paid on the annuity. It's not thier fault, it the financial instutions that created this imbalance. Anyone considering annuties should be sure they have a financial planner that comes highly recommended and well known in the community and you should know people who are very satified with this person and has been with them a long time; also be very careful with variable annuities. I have been doing taxes a long time and without exception, the overwhelming best long-term performance of retierment funds I have seen is buy and hold blue chip stocks, which by the way, is most likely where the annuity (and mutual fund) company is going to invest the funds they are holding.

Not all financial advisers accept commissions so your blanket statements are hollow and dangerous.

Your blanket advise is as silly as the people who claim to NEVER BUY WHOLE LIFE INSURANCE. While that is fine for a large percentage of the population, it's horrible advice for some people. Every person is different and their situation is different. Being a tax preparer does not make someone an expert at all things financial.

[John of PA]

" Being a tax preparer does not make someone an expert at all things financial. "

What the tax preparer does see is hundreds of tax returns every year and thus, their clients personal financial experiences and definitive patterns on where persons are successful and not. We learn a lot seeing all those tax returns, and with rare exception, the best performers (long term) out there are a diversified portfolio of quality blue chips. Which blue chips? Thats up to the financial planners. My problem with many financial planners is they are under pressure from thier broker dealers to funnel money to certain types of investments like certain mutual funds and annuities. There are good financial planners out there, one must be careful and make sure they find a good one.