[E Lynn]

My parents just signed up to work with an Ameriprise financial advisor per a recommendation (ugh, I know.).

They’ve already paid him $10,000 for a year of his services. (They did not consult with me.)

What’s the best way to be ride out this year?

He will be helping my mom fill paperwork out for retirement: pension, Medicare, etc.

he came recommended from a colleague of hers who helped with retirement, and she trusts her coworkers opinions unfortunately.

My parents have made it clear to him that they do not want him investing in his recommended ETFs.

On our call last night, he started talking about notes, managed funds.

Also, they have asked his help in creating a trust with their financial assets.

Help! Advice?

I’m headed there next week to meet with an elder attorney and this Ameriprise FA, but have also reached out to a few based advisors for future wealth management.

[Ron]

True story: my wife and I for years would bring new parolees from jails around the state into our home to live with us for 6-12-months.

Note: My son got us started doing this and they would often stay in his room with the extra twin bed.

We just did it…

there was no pay involved.

They were generally incarcerated for drug use, armed robbery, and similar crimes.

We would work with them to get them thru the court system, taken them to the weekly drug testing, get them clothes, and after a while, get them a job and an apartment (once we were satisfied they were able to stand on their own two feet.)

A slew of them were all offered jobs by Ameriprise.

None had degrees or anything that remotely qualified them for these jobs.

I found it insane.

[Kristin]

My grandma got sucked into this. Luckily(?) she had a stroke and we were able to get them to back off and leave her alone until her death and, of course, the heirs pulled the money out of there asap.

It was also a relatively small amount of money, so it didn’t make or break her…

…and, she had most of the rest of her money with Edward Jones, which was even worse

(and, her EJ guy DIDN’T leave her alone and continued to move her money around even after her stroke, in spite of being advised by her POA that she wasn’t able to make decisions about her finances any longer!) …

but, that’s another story…

[Betsy]

Can they use him for financial planning but not management? That would be the best use of their money during this year.

Sounds like the $10k is a sunk cost.

No need to make it worse with additional management fees.

[Lori]

my parents used a guy that ripped them off for years.

Do they have an attorney that could give them a referral??

My attorney specializes in wills estates works with a specific tax and financial planner.

This person may have enough training designations to get them started and answer questions.

Talk to them about FEES, maybe print some graphs of Vanguard fund costs etc so they are at least aware of the difference.

Fees matter if leaving legacy for future generations.

[Margaret]

Ask them in front of your parents if they are acting as fiduciaries for them.

I bet the answer is no.

Keep educating your parents as to why this was a bad decision.

They could lose a lot of money.

[Alicia]

Only estate planning attorneys should be setting up trusts. And the attorney your parents use to form their trust can provide a referral to a decent financial advisor if your parents want to keep using one going forward.

[Russ]

Ameriprise is captive insurance company. They’re restricted on being able to offer everything available in the open market – that alone should be enough to sway their opinions of their co-workers opinions…

Would you go to your eye doctor to get your teeth cleaned?

[Andy]

What’s the nature of the $10k they’ve already paid??? Was it for a commitment of a one-year engagement or something?

Generally speaking, I don’t believe regulators allow that large of an upfront payment without the ability to get at least some of it back should the client decide to terminate.

I’m more concerned about the apparent difference of investment views and philosophies.

When someone signs up with a financial advisor to manage their investments, they give more or less complete and absolute discretion to the advisor to invest as they see fit.

Granted, there will be certain risk considerations that come into play (such as making sure your parents aren’t 100% in a single tech stock).

But, unless your parents give the advisor a detailed list of securities they do NOT want to be invested in, the advisor more or less has carte blanche.

And with Ameriprise, they’re really good at pushing their broader model portfolios and products du jour.

With that said, your parents may not have much say in what actually get invested in.

If this is a serious concern of theirs, the need to bring this up now, and get it squared away.

Ask the advisor exactly what he or she intends to invest in.

If your parents aren’t okay with the answer, it’s time to terminate.

There are other folks, such as hourly advisors, who can help fill out forms for pensions, SS, Medicare, etc.

If that’s one of the main things they’re looking for, hiring Ameriprise is definitely not the best solution.

[Author]

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