Help -- I think SIL bought a Variable Annuity

[bright eyed]

Quote:

Originally Posted by peggy Just to be a little more clear about the circumstances that made me feel we needed to say something -- this SIL is the one referenced in my thread from April -- http://www.early-retirement.org/foru...ned-27912.html She had asked our advice on how to handle the situation financially, and hubby and I spent an evening with her drawing up a plan. A month or two later, we went with her to talk to a financial advisor -- a GOOD one, the one who's been handling my mom's finances for years. We'd understood at the time that SIL intended to follow the plan that we and the advisor came up with, and perhaps give a portion of her money to this "friend." So when we found out yesterday that she'd given ALL of her money to this "friend" and that he'd put her in this highly questionable "investment," we felt obligated to tell her what's going on. Maybe we were wrong; but we'd hate to see her lose the only start at retirement funds she has because of this "friend."

I think the deeper question to consider is - why would she do this? Why would she give ALL the money to the "friend?"

Why did she make this move on her own - did she want to feel independent?

Did his pitch sound too good to surpass - he convinced her it was all she need to do to be FI?

And why didn't she go back and check with you about this decision if you all had done this as a group before?

Family stuff is so complicated. Dynamics are both old and hardened while also changing as we age.

If you can answer those questions, it might help you come up with the best approach to helping find some resolution.

If you just call her and say, "hey, this is like the worst idea ever" she may feel stupid, get mad/defensive and not consult you any further on other big decisions. I know from experience.

Finally, this friend is a real selfish jerk if they knowingly took all her money into this bad plan...especially if they knew they would get such a great bonus out of it - and knowing what she had been through.

Again, in that scenario it may be a question of who SIL is choosing to trust and why...

[peggy]

Home from work and have an update --

SIL told hubby that, "I can see you've found something that upsets you." And she and hubby are going to talk to the "friend" (jerk, salesman, your choice) on Wednesday. The clock on the free look period started ticking on the 22nd, which is better than we'd hoped for (we thought it started on the 15th).

Bright Eyed, you raise good questions. My best knowledge of the situation at this point is, (a) she's still grieving, and (b) hubby is younger than she is by a lot -- the big sister thing is hard to shake. Thankfully, she does seem to realize that she was TOO trusting in this instance.

Again, many many thanks to all of you!

[RetireeRobert]

Quote:

Originally Posted by peggy Home from work and have an update -- SIL told hubby that, "I can see you've found something that upsets you." And she and hubby are going to talk to the "friend" (jerk, salesman, your choice) on Wednesday. The clock on the free look period started ticking on the 22nd, which is better than we'd hoped for (we thought it started on the 15th). Bright Eyed, you raise good questions. My best knowledge of the situation at this point is, (a) she's still grieving, and (b) hubby is younger than she is by a lot -- the big sister thing is hard to shake. Thankfully, she does seem to realize that she was TOO trusting in this instance. Again, many many thanks to all of you!

Clock starts ticking 22nd, but they don't meet till Wednesday. Hope the free period IS 10 days, and they act fast after Wednesday's meeting.
Interesting story. Please keep us updated on developments!

[bright eyed]

Do let us know how it goes!

Sounds like she at least has some buyers remorse... even if it means lil' bro is right!

It would be hard for me to be at that meeting (if this was my friend or family) and not want to deck that "friend"! but then again, some people are so ignorant and have no ethics so they have no idea how wrong they are...

would love to hear what the friend says...they are always great at the pitch, not at the rebuttle...

[Bailer]

There has been a lawsuit filed against Allianz regarding Deferred Variable Annuities. I remember hearing about it in the news, and did a quick google search.. Your SIL might
mention that at the meeting on Wednesday.

[Bailer]

That's a Class Action lawsuit, by the way!

Bailer

[Bestwifeever]

Peggy, I just read the old thread and this one and I just want to thank you for being there for your SIL, no matter what happens. Your kindness (and that of your DH) shines through. So sorry she is being taken advantage of, it sounds like--

[peggy]

DH just called, and the whole thing has gone from the ridiculous to the truly freaking BIZARRE.

Apparently, the "friend" who sold SIL the EIA has $600k of his own money in the SAME EIA. Never mind, of course, that it is (as has been pointed out here) the subject of a lawsuit that's just been certified as class action. I have to reluctantly conclude that the "friend" is not malicious, just stupid, which could be worse.

Anyway, the VERY GOOD news is that the policy itself has a 20 day free look period, and that started ticking on October 22, so SIL is completely able to get her money out of it. She requested that at the meeting today, and I advised DH to advise her to follow up with a CRRR letter to the "friend" and to the home office of Allianz.

"Friend" had also sold her a Variable Annuity that the paperwork hasn't come back on yet (i.e., the free look period hasn't even begun to tick). DH has the prospectus for that annuity, and warned the "friend" that he's seen several VAs and hasn't liked any of them. So I suspect we'll be advising SIL to get her money out of that one, too.

OTOH, at least he hadn't sold her a whole life policy (as we'd feared). He did sell her a term life policy that will last until she's 90. DH had no objection to that, based on SIL's stated desires to provide something for her step-sons.

I now know what I'll be doing tonight, between answering the door for beggars trick or treaters: reading the VA prospectus and drinking a lot of caffeine.

[RetireeRobert]

Quote:

Originally Posted by peggy DH just called, and the whole thing has gone from the ridiculous to the truly freaking BIZARRE. Apparently, the "friend" who sold SIL the EIA has $600k of his own money in the SAME EIA. Never mind, of course, that it is (as has been pointed out here) the subject of a lawsuit that's just been certified as class action. I have to reluctantly conclude that the "friend" is not malicious, just stupid, which could be worse. Anyway, the VERY GOOD news is that the policy itself has a 20 day free look period, and that started ticking on October 22, so SIL is completely able to get her money out of it. She requested that at the meeting today, and I advised DH to advise her to follow up with a CRRR letter to the "friend" and to the home office of Allianz. "Friend" had also sold her a Variable Annuity that the paperwork hasn't come back on yet (i.e., the free look period hasn't even begun to tick). DH has the prospectus for that annuity, and warned the "friend" that he's seen several VAs and hasn't liked any of them. So I suspect we'll be advising SIL to get her money out of that one, too. OTOH, at least he hadn't sold her a whole life policy (as we'd feared). He did sell her a term life policy that will last until she's 90. DH had no objection to that, based on SIL's stated desires to provide something for her step-sons. I now know what I'll be doing tonight, between answering the door for beggars trick or treaters: reading the VA prospectus and drinking a lot of caffeine.

I'd say your SIL is very lucky to have a brother and a SIL like you and your DH!

[TromboneAl]

Let's have a party when she gets her money back.

[Achiever51]

Quote:

Originally Posted by peggy DH just called, and the whole thing has gone from the ridiculous to the truly freaking BIZARRE. Apparently, the "friend" who sold SIL the EIA has $600k of his own money in the SAME EIA. ...

FWIW, the "friend"/salesman/advisor/whatever was using one of the first tenets taught in "sales school"...i.e., make the customer comfortable by identifying with them -- "I know how you feel"..."I faced the same decision"..."I feel so strongly about this opportunity that I invested in it myself/had my widowed mother invest in it." Perhaps he indeed did invest in this EIA...if so, all the more reason your SIL shouldn't trust his judgment!!

[bssc]

Quote:

Originally Posted by Achiever51 FWIW, the "friend"/salesman/advisor/whatever was using one of the first tenets taught in "sales school"...i.e., make the customer comfortable by identifying with them -- "I know how you feel"..."I faced the same decision"..."I feel so strongly about this opportunity that I invested in it myself/had my widowed mother invest in it." Perhaps he indeed did invest in this EIA...if so, all the more reason your SIL shouldn't trust his judgment!!

That is why affinity sales (and affinity fraud) works. People think that friends/coworkers/fellow churchgoers wouldn't lead them astray. One of the people in my wife's office came out of retirement since he had given several 100K to a person at his church.

[haha]

Quote:

Originally Posted by bssc That is why affinity sales (and affinity fraud) works. People think that friends/coworkers/fellow churchgoers wouldn't lead them astray. One of the people in my wife's office came out of retirement since he had given several 100K to a person at his church.

In the small community that I lived in prior to moving to the city, every ten years or so someone would ruin a group of fellow church members with some outright investment fraud, usually a Ponzi scheme where the money would go to luxury cars, homes in Palm Springs, etc. The last one I remember was done by an assistant pastor. Even after the fraud is obvious, some of the victims were supportive of this guy.

People with pleasant go-along-get-along personalities often are insufficiently wary of "folks like us".

Ha

[TromboneAl]

Sincerity is the key to that job. Once you can fake that, you've got it made.

[bright eyed]

Quote:

Originally Posted by peggy DH just called, and the whole thing has gone from the ridiculous to the truly freaking BIZARRE. Apparently, the "friend" who sold SIL the EIA has $600k of his own money in the SAME EIA. Never mind, of course, that it is (as has been pointed out here) the subject of a lawsuit that's just been certified as class action. I have to reluctantly conclude that the "friend" is not malicious, just stupid, which could be worse.

Sounds like he drank the koolaid and wanted to pass it around. people get sucked in by the hype, the "possibilities", the "tax free" lingo they all throw around. They're so enthusiastic because they believe!

i came to the same conclusion about my friend's cousin. At first i was concerned that he was a slimy shark, but i came to realize he was a dim slimy catfish.

[haha]

Quote:

Originally Posted by bright eyed i came to the same conclusion about my friend's cousin. At first i was concerned that he was a slimy shark, but i came to realize he was a dim slimy catfish.

For a time I sold insurance. My company wouldn't let anyone sell their product unless we bought it ourselves. I didn't think I needed it, but I realized that so what, I'll make so much selling lots of turds that I can afford to buy one without doing any damage.

Yes M'am, I own this myself! I wouldn't go without some universal life!

Anyway, haven't we all lived in PC America long enough to know that we are supposed to be non-judgmental?

Ha

[cute fuzzy bunny]

Whats that old saying? Never attribute to malice that which can be explained by stupidity?

Peggy, glad your SIL is getting out of the ugly mess. Thats a very good thing.

[TromboneAl]

How about an update on this, Peggy.