Investing: Four words that can rob you blind
- By
- Allan Roth
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- February 9, 2012
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(Credit:
CBS/iStockphoto)
We in the financial services industry are experts in using words to convince you that we are on your side. The problem is, of course, that we often aren't.
I've looked at thousands of pitches over the years that were meant to lull investors into thinking they were making the right decision. These pitches will almost always include the four words that are frequently used to trick you.
Each of these four words are seemingly logical and devoid of emotion. In fact, all four words are employed in the context of persuading you to believe you are making a logical decision, when all they actually do is get you to act emotionally. Click "next" above to see each of the four words that can be used to rob you blind.
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- by kbbpll February 9, 2012 10:34 PM EST
- Work hard and save your money. Whatever happened to that investment strategy?
- Reply to this comment
- by sandiegopete February 9, 2012 7:16 PM EST
- Anyone who would trust one of those so called financial advisors deserves to lose their money.
- Reply to this comment
- by OliveV February 9, 2012 7:04 PM EST
- If you are wary about an investment and think it might be a scam, Ripoff Report is a good place to check up on firms. Steer clear of those with multiple complaints. I actually found a firm I wanted to use there because they had issued a rebuttal and, ultimately, took care of the situation in a way I thought was impressive. They have been good to me from the beginning. YMMV.
- Reply to this comment
- by Transatlantique February 9, 2012 7:01 PM EST
- As a survivor who suffered great losses at popular full service investment firm that can be found on every corner in suburbia with a hunter green sign, the sales pitch I was given when I inherited money from an account at this firm is the 10 year period pitch, and the buy, hold, and forget mantra. Both of those nasty phrases lost me 10's of thousands that I could have preserved had they also given me all of my options instead of only the ones they wanted me to know, which were few. I had to pay a fee to get into American Funds Group, and was told that if I got out there would be another fee to get back into it. It is the reason I never realised gains, and the reason I lost gains and principle. However, what they neglected to tell me was that there was a money market in that fund family that would have allowed me to realise gains without having to pay a fee to get back into the funds I exited. They don't like to be bothered with moving money around because it cuts into their 1.5 hour lunch time.
When I wanted 5 grand invested in Apple at $12 per share in '02, I was shown a chart of previous performance with the promise that "you'll only get your money back in 10 years." How wrong he was. I was discouraged and have regretted that ever since. One mutual fund had doubled but it was never suggested that I realise the gains. I wanted to buy the house next door for 60 grand and was told the real estate market was going bust...in '98. I would have made 40 grand from that had it been encouraged by that BROKEr. Another fraudster at this BROKErage tried to sell me a bond fund from the sale of a bond that had fallen to 9 cents on the dollar, but by then I was experienced enough to know that he was crooking me and I left the BROKErage after the bond eventually came back.
None of the BROKErs I worked with had business degrees. The first was a history major, the second a music major, the third a journalist major, and the last an English major. They had no business calling themselves financial advisors. Although I have to say that I was naive at first about investing as an heir, I had to learn the difficult way that I can trust no one. Advice: friends never let friends invest with .... all you have to do is look around the corner at the nearest pod mall to find one with its hunter green sign with the adverts to "join us," which sounds like a cult. - Reply to this comment
- by Transatlantique February 9, 2012 6:56 PM EST
- As a survivor who suffered great losses at popular full service investment firm that can be found on every corner in suburbia with a hunter green sign, the sales pitch I was given when I inherited money from an account at this firm is the 10 year period pitch, and the buy, hold, and forget mantra. Both of those nasty phrases lost me 10's of thousands that I could have preserved had they also given me all of my options instead of only the ones they wanted me to know, which were few. I had to pay a fee to get into American Funds Group, and was told that if I got out there would be another fee to get back into it. It is the reason I never realised gains, and the reason I lost gains and principle. However, what they neglected to tell me was that there was a money market in that fund family that would have allowed me to realise gains without having to pay a fee to get back into the funds I exited. They don't like to be bothered with moving money around because it cuts into their 1.5 hour lunch time.
When I wanted 5 grand invested in Apple at $12 per share in '02, I was shown a chart of previous performance with the promise that "you'll only get your money back in 10 years." How wrong he was. I was discouraged and have regretted that ever since. One mutual fund had doubled but it was never suggested that I realise the gains. I wanted to buy the house next door for 60 grand and was told the real estate market was going bust...in '98. I would have made 40 grand from that had it been encouraged by that BROKEr. Another fraudster at this BROKErage tried to sell me a bond fund from the sale of a bond that had fallen to 9 cents on the dollar, but by then I was experienced enough to know that he was crooking me and I left the BROKErage after the bond eventually came back.
None of the BROKErs I worked with had business degrees. The first was a history major, the second a music major, the third a journalist major, and the last an English major. They had no business calling themselves financial advisors. Although I have to say that I was naive at first about investing as an heir, I had to learn the difficult way that I can trust no one. Advice: friends never let friends invest with .... all you have to do is look around the corner at the nearest pod mall to find one with its hunter green sign with the adverts to "join us," which sounds like a cult. - Reply to this comment
- by Allan_Roth February 9, 2012 5:46 PM EST
- Words like "gold,great deal, once in a lifetime, etc" are emotional words that are used by salespeople. The four words I used were meant to appeal to the logical brain, in a very misleading way.
Trust me - I'm a financial planner acting as your fiduciary :)
Honest Al - Reply to this comment
- by OldProfessor February 9, 2012 5:12 PM EST
- I have the same feelings for car salesmen who proclaim up-front they are honest salesmen.
- Reply to this comment
- by dzaffina February 9, 2012 4:14 PM EST
- wall street are theives
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- by username751 February 9, 2012 4:07 PM EST
- Sounds like when a movie claims that it is "based on a true story", it usually means it's mostly fiction.
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- by antoniof123 February 9, 2012 4:01 PM EST
- Hey who has money to invest these days it is a struggle just to keep food on the table for most people.
So when they call you say I don't have any money they leave you. - Reply to this comment
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