NOTHING WILL BE SOLD AT THIS SEMINAR (?)

If you have a lot of money, you can hire professionals to take care of your taxes, your estate planning and your retirement investment portfolio. If you have too little money, you don't really need those professionals---you need more money. Somewhere between these two extremes is a huge segment of the population that needs help, but can't afford the high-priced pros who are there for the rich and famous. And it's that huge middle segment that are invited to "Free Seminars." The old saying, "There's no such thing as a free lunch," has never been more true than it is in these days of financial uncertainty. But free lunches do abound, particularly for people on the cusp of retirement planning. There are a lot of people like that in my home town, and invitations to free meals arrive frequently. There's a catch, of course. The free meal is preceded by a "seminar" in which you will learn everything that you will ever need to know about everything having to do with taxation, estate planning and investing. All in one hour. Then, dinner is served. I attend these freebies when I can, not because I'm hungry, but because I want to see what is being pitched to the eager and unwary (and hungry) public. They all follow the same patterns. The invitation notes clearly that nothing will be sold during the seminar. Nothing, that is, unless you count the hard sales pitch to get people to turn over thier financial affairs to the seminar hosts, who call themselves financial planners of one sort or another. Some of these planning firms might indeed be of value to the right people in the right circumstances, although some would like you to believe that they can be all things to all people. As with choosing any professional----medical, legal, insurance, etc.---you should understand the person's credentials and get trustworthy personal references. For many folks, financial planning professionals who generate their clientele at these seminars can be as good as any you'll find, but you MUST do your homework before you sign up. I was just at one such seminar and it was the same-old-same-old. The speaker started off by trying to scare the attendees into believing that leaving their pension accounts under the control of their employer was dangerous. "Better to turn that money over to professionals like us. Your employer might make mistakes, but we never will...." That kind of brain-game. Then there were brief and blurry minutes of rushing through subjects that would each take hours to just scratch the surface. Toss out enough question marks and some of them will stick in people's heads. Then came the offer of a free "consultation" with the experts to analyze the prospect's financial condition. During the meal which followed, the speaker flitted constantly from table to table urging everyone to fill out the questionnaire that would become the guidelines of the free consultation. During the roughly one hour seminar portion there was virtually nothing of any substance that was set forth. Plenty of seeds of doubt and fear were sown. And sadly, I must admit, that most people who need professional help in these areas will not seek it unless they are motivated by doubt and fear. Indeed, the guidance one gets from signing up with the seminar experts might well be better than getting no guidance at all. If you are tempted to go for the free lunch and whatever it leads to, please be certain to learn, in advance, how the experts charge for their counsel. If they are selling any financial products, such as annuities or mutual funds, they will likely earn a commission. That creates a possibility of conflict of interest---the annuity or mutual fund might be more beneficial to them than it will be to you. Do they charge a flat fee, and if so how is it calculated? Do they charge you a percentage of your assets that they are managing for you, and if so, how does it compare with other advisors who charge similarly? And it bears repeating---get trustworthy personal references from other customers. "Trustworthy" means objective evaluation from someone who is NOT in the pocket of the salesperson. That might be tough to come by. If you can't get it, the precautionary "proceed at your own risk" should be echoed loud and clear. This article supplements Chapter 19, pages 566-575 in Personal Finance. Access the textbook by clicking on the box in the right column.