Shot through the heart and you're to blame
You give love a bad name.
-- Bon Jovi
I watched a man give annuities a bad name.
I was in a coffee shop, having breakfast with my daughter, Angela Luhys, on a week when my weight loss had reached the 90 pound mark since November. While sharing this great milestone with Angela, the guy in the booth behind me was trying to sell an annuity.
And doing a very bad job of it.
My daughters, son-in-law and I work in our family businesses that are devoted to helping people hang onto their money. Annuities are a good tool to make that happen. Your family may sit around the dinner table and talk about the weather. Our family talks about internal rates of return and actuarial tables.
It works for us.
We were geeks before people starting calling each other geeks. But we are street-wise geeks. We can immediately recognize when someone has true expertise and when a person doesn't have a clue what they are talking about.
Like the guy trying to sell the annuity.
Angela and I kept finding ourselves drawn to the conversation behind us.
From what I could tell, the two men had met in church and the annuity salesman kept harping on that relationship. The focus of the talk was a guilt trip about their church connection. The potential client's true financial needs were rarely mentioned.
I am not a religious scholar, but I am very confident that if I studied every word of the Bible, Quran or any other holy book, there is not a single word about buying an annuity anywhere in them.
Good financial planning means asking a lot of questions. The sales talk comes later or may never come at all. Not all products fit all situations.
I had to get up and use the restroom. When I got back, Angela was absolutely livid. Apparently the salesman had made some statements about estate and capital gains taxes that were absolutely wrong. (For those of you who are truly interested, you cannot receive capital gains tax treatment on the gain inside an annuity. If it is taxed, it will be as ordinary income.)
I knew my daughter, who is Executive Director of Kentucky Guardianship Administrators, well enough. It was time to go.
Angela is passionate about her primary mission in life. Protecting injured people from family, "friends" and other predators. I knew she was about to jump into that supposedly private conversation. Then we saw that the man with the money was not buying.
No sale, no foul, but the experience keeps lingering in my mind.
I like many kinds of annuities. In fact, I love certain kinds, but after 34 years in the financial services business, it a mature and well-rounded kind of love. I see the good and the bad, the up and the down. I can argue just as passionately about why annuities are inappropriate, as I can on why someone should have one.
I'm not rigid or dogmatic about anything and keep an open ear to an opposing argument. I can argue both sides, like an attorney who can argue either side of a legal case, because I know about the other possibilities.
I am sure myself, and the rest of my family, could take on anyone and everyone if they had an annuity version of Family Feud or Jeopardy, but we keep our eyes open to all the other concepts and ideas out there.
Because, the bottom line is that people are not cookie cutters; they are people. Each individual has very specific needs, wants, aspirations and goals. Some people have no goals or aspirations. They have financial needs, too.
Thus, listening to the annuity salesman do such a poor job was disheartening. And complicated.
I am one of those who think that we have too few financial counselors in the world. The number of people who really understand financial and estate planning gets smaller each year. We need more good people to make a living in the business and know what they are doing.
There is all the research you could ever want on the internet, but there is that point where it is not all about statistics and data sheets. It is about people.
The right questions can get people to the right financial answers. The answer may be a product, like an annuity or a bank account. The right answer may be to pay off their credit cards and forget about investing. The right answer may be to change spending or savings habits.
There are many times we tell people to keep doing what they are doing. Those people are usually stunned by that conclusion, but it gives them peace of mind to have someone else bless their strategies.
Thus, when I watch someone flame out, like the salesman in the coffee shop, I realize that he is probably not going to be in business long enough to truly be able to help people. And apparently was not trained well to begin with.
The fact that he would have a private financial conversation in the middle of coffee shop, with tight tables, tells me that common sense was lacking in some of his education.
It takes a long time to build up expertise. More than that, it takes passion and a true interest in the profession you have chosen.
Thus, I really get annoyed that the salesman picked an annuity as his product of choice. His potential client seemed smart enough to see through his "friend's" lack of expertise and will probably be turned off to annuities in the future.
Some entertainers who give financial advice via the mass media, like Dave Ramsey, bash on all annuities for all reasons. It's easy to see why. Annuities can come across as incredibly complicated financial instruments and not easy to explain in a 20-second radio conversation.
It's also easier for people like Dave to eliminate all annuities for all reasons, especially when they are selling other products to their listeners, than it is to explain the nuances of why some are good and why some are not so good.
Annuities usually pay a commission to the person offering it. There are people who are licensed as insurance consultants in certain states (Disclaimer: I am a licensed insurance consultant in the state of Kentucky and other states) and those people can evaluate annuities for a fee instead of a commission. For whatever reason, the idea of fee based annuity advisors has never really caught and although there are some "no load" annuities out there, the selection is not as wide as annuities that have a commission built in.
Guys like the man in the coffee shop give annuities a bad name. And make it easy for people like Dave Ramsey to demagogue the concept entirely.
So what does any of this have to do with my 90 pound weight loss? Everything.
Why Finding the Right Advisor is Key
Gonna do my very best and it ain't no lie
If you put me to the test, if you let me try.
When I reached 377 pounds, I had to make a radical life change or die. I decided not to die.
I knew that I had to go all out, all in, to overcome a lifetime of extreme obesity.
I am luckier than most people. I have two world class doctors, Dr. Phillip Hoffman MD in Lexington, Kentucky, and Dr. Jim Roach MD in Midway, Kentucky, who are not only my doctors, but my very close friends.
The story of how my weight loss started is spiritual in nature and best told in a Huffington Post book review that I did for Dr. Jim's best-selling book, God's House Calls. Dr. Jim wound up writing a best-selling book with my company RRP International Publishing, and I would up having the gastric sleeve weight loss surgery.
An area of my fascination is what to do with your money if you win the lottery. Most people blow through it, just like most people gain back all the weight after a diet.
I tell people to follow five distinct steps to protect their lottery money, but one of the most important is to find an advisor who has worked with more money than what you have. If you win $100 million, find an advisor who has worked with $150 million. They are out there.
The same holds true in any field of endeavor including the medical world. I wanted to find the best weight loss surgeon I could find in my region. Some of my friends go to high powered specialists in other cities for surgeries. I wanted to recover in Kentucky, where my family and doctors who cared about me were nearby. I'd built up a lifetime of great connections in Kentucky. I wanted them close as I recovered.
Thus, I found my way to Dr. Derek Weiss, and we did the surgery at the hospital in Georgetown, Kentucky. He is nationally recognized, but also in my backyard.
I wrote a long piece on Huffington Post about the process that I used to select Dr. Weiss, and it was extensive. I spent about a total of five hours interviewing one on one. I spoke to about 40 of his previous patients and went out of my way to find those who might have a negative view. I searched any and all public record information about him. I wrote several articles and posted all over social media that Dr. Weiss was going to be my surgeon.
I was literally putting my life in his hands. I know the families of several people who did not live through weight loss surgery. I've met others who had to go back frequently to get additional surgeries or readjustments.
I'm still here and feel great. I don't see any adjustments in my future.
By the time Weiss did my surgery on December 1, 2014, I was confident that I had made the right choice.
My surgery was excellent and I have had no complications I am aware of. I feel better than I have in my adult life.
Derek and his staff truly care about their patients. I have referred a number of my friends to him and will continue to do so.
I picked the Georgetown hospital for three reasons.
I wanted Derek as my surgeon, and since I was paying for the surgery without the benefit of insurance, I wanted to get the best "bang for my dollar." I had to find a hospital who would work with me on cost and allow me to have the surgery in their facility. I had a friend on the inside as the dietician, Cindy Caywood, had worked with me in another weight loss program and I could vouch for her ability, knowledge and especially for her character.
I checked out the facility and talked to almost every person in the process at Georgetown Hospital. I had incredibly good care from my nurses and the staff. I would recommend the hospital and it is a Bariatric Surgery Center of Excellence, but the problem with referring someone to an institution is that the people inside that institution change.
Thus, I refer people to Dr. Weiss, not the hospital. I let them decide which facility where Dr. Weiss will do the surgery.
If you refer someone to an individual, like I do with Dr. Weiss (or Dr. Roach or Dr. Hoffman), you can vouch for the credibility of the individual. With an institution, people inside that institution can change, management can adapt a different style and things can alter quickly.
The quality of the individual adviser is the key.
People focus on products, like annuities, and not the people who are recommending them. It should be the opposite.
I had never heard of the gastric sleeve type of weight loss surgery before I met Dr. Weiss. I read about 40 books and numerous medical journal articles before I let him perform it on my body, but ultimately I came to the conclusion that he was the expert I selected and I needed to run with his advice.
As I sit here, 90 pounds lighter, with a very good chance I will lose another 90 before it's all said and done, I realize the strategy paid off.
It's easy with the vast amount of information available to want to be your own expert on every topic. I've done a lot of that myself and even when I get a good expert, like Dr. Weiss, I still ask a lot of questions and do a lot of research. It's just who I am.
I have found that the real genius of research is not to develop expertise, but to find out who has the kind of expertise that you want and not settle for less. Let the expert be the expert.
Not everyone can do that.
There is always a day when something about an adviser says, "take a chance on me."
Take that chance. It worked for me.
Don McNay, CLU, ChFC, MSFS, CSSC is a licensed life insurance agent and insurance consultant in Kentucky and many other states. He is the founder of McNay Financial, McNay Consulting, Kentucky Guardianship Administrators LLC and RRP International Publishing and Digital Media.
McNay has Master's Degrees from Vanderbilt University and the American College. He is a Chartered Life Underwriter, a Chartered Financial Consultant and a Certified Structured Settlement Consultant. He is in the Eastern Kentucky University Hall of Distinguished Alumni and serves on the Board of Directors for the Eastern Kentucky University Foundation.