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Is Your Financial Advisor Honest? Are You Sure?
Learn how to:
Is your financial advisor the next Bernie Madoff? Can you afford not to know? Get this book, and find out! Read Bonnie Kirchner’s unforgettable personal story: Her sudden realization that she was married to one of the nation’s worst financial fraud artists. Then, follow Kirchner’s journey…learn what she learned about detecting financial scammers…discover the questions you must ask and the steps you must take so it never happens to you!
Foreword . . . . . . . . . . . . . . . . . . . . xi
Acknowledgments . . . . . . . . . . . . . . . xiii
About the Author . . . . . . . . . . . . . . . . xv
Introduction . . . . . . . . . . . . . . . . . . xvii
Chapter 1 Recent Investment Scams . . . 1
Bradford C. Bleidt . . . 1
Bernard Madoff . . . 8
Chapter 2 What Is Financial Planning? . . . 15
Chapter 3 The Meaning Behind Advisor Designations and Licenses . . . 21
Chapter 4 Advisor Compensation . . . 31
Chapter 5 Deciphering Fee Structures . . . 35
Portfolio Development and Asset Management . . . 35
Financial Planning . . . 36
Stocks, Bonds, and Exchange Traded Funds . . . 36
Mutual Funds . . . 37
Variable Annuities . . . 39
Indexed Annuities . . . 41
Insurance . . . 41
Chapter 6 Finding Additional Fees . . . 43
Managed and/or Brokerage . . . 43
Variable Annuities . . . 44
Mutual Funds . . . 45
Exchange Traded Funds and Index Funds . . . 46
Chapter 7 Financial Products and Advisor Compensation . . . 47
Investment-Related . . . 48
Insurance Coverage . . . 49
Financial Planning . . . 50
Chapter 8 Statements, Communications, and the “Dreaded” Prospectus . . . 51
Statements . . . 51
Prospectuses—Mutual and Exchange Traded Funds . . . 53
Shareholder Updates and Annual Reports . . . 55
Prospectuses—Variable Annuities . . . 56
Standard Charges (on Most Contracts) . . . 56
Rider Electives . . . 57
Proxy Materials . . . 57
Chapter 9 The Roles of Various Financial Institutions . . . 59
Investments in Insurance Products . . . 61
Investment Management and Investment Product Sales . . . 63
The Broker/Dealer . . . 63
The Custodian . . . 64
The Federal Deposit Insurance Company . . . 65
The Securities Investment Protection Corporation (SIPC) . . . 66
Chapter 10 Understanding What You Need . . . 67
Chapter 11 Choosing Advisors to Consider . . . 77
Chapter 12 Choosing Candidates to Interview . . . 81
Chapter 13 Interviewing Candidates . . . 85
Preparing for the Meeting . . . 85
During the Meeting . . . 92
After the Meeting . . . 97
Chapter 14 Spotting Red Flags: Advisors to Avoid . . . 101
The Name and Information Gathering Phase . . . 101
During the Meeting . . . 104
After the Meeting . . . 106
Advisors to Avoid . . . 107
Chapter 15 The Rules of Engagement . . . 111
Chapter 16 Maintenance of the Advisor–Client Relationship . . . 127
Chapter 17 Activity . . . 131
Chapter 18 Accessibility . . . 135
Chapter 19 The Dysfunctional Relationship . . . 137
Chapter 20 Criminal Versus Non-Criminal Behavior . . . 143
Chapter 21 Filing a Complaint . . . 149
Appendix A Consumer Resources . . . 155
Credit Ratings Agencies . . . 163
Appendix B Glossary . . . 167
Index . . . 187