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bwhiteclu wrote,

Consider the poor young widow who seeks advice for a $15,000 or $20,000 life insurance settlement that she wants to invest for her kids education: You would charge her a fee for a plan of upwards of $1,000 and send her down the road or to the internet broker with a recommendation to purchase a certain type of mutual fund, and come back next year for a review and update.
And a reminder letter would go out next year (conflict of interest?). Or you would tell her that she really did not have a big enough asset to warrant the time and charges you would have to bill her in order for you to make a living. (Thank you for coming in. Pay the lady up front $75 for consultation time.) Then you could smugly sit back and deny any conflict. She goes down to the commission paid broker, who spends time with her deciding how she should invest the money for her kids education and IF she invests it he makes 2-3% for the transaction. A better deal for her...she did not need nor could she afford a financial plan. A good deal for you because you did not want to fool with her in the first place.

Why not just forget about CFPs, CLUs, and CPAs and just give the poor young widow the 800 number for Vanguard. That's where she's least likely to get screwed.


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