Winner, winner chicken dinner!
One of the more popular prospecting strategies for financial advisers over the last couple of decades has been the dinner seminar. While its popularity has waned recently, with new marking strategies taking hold, there are still plenty of seminar dinners still taking place.
Here are a few things consumers might want to know before they sign up for a “free” night out.
From just $107.88 $24.99 for Kiplinger Personal Finance
Become a smarter, better informed investor. Subscribe from just $107.88 $24.99, plus get up to 4 Special Issues
Sign up for Kiplinger’s Free Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
The same script
Invitations to the seminar go out to many individuals in a certain geographic area. The invite is to learn more about a certain topic, usually ones involving some aspect of retirement. Popular topics include tax-reduction strategies, retirement income, Social Security planning and asset protection.
Once you arrive at the seminar for the night, the talk usually follows a certain path. There is a problem facing you as you get closer to retirement: Taxes, re-creating a paycheck, how to take Social Security and market volatility.
Then once the presenter spends time talking about the challenges and potentially scaring the audience, they offer solutions. How nice of them! It should be obvious, but the solution is usually something they are selling. They need to recoup their costs for all the steak dinners that you and everyone else around you just enjoyed. It makes sense, but there could be some issues.
To invest or not to invest
It’s important to know who these presenters work for. As a financial adviser there are tons of investment companies that knock on the door, send me emails and reach out through phone calls to discuss their investments. I have found that if the person represents a bond investment offering, they usually talk about how overpriced the market is and how it makes sense to increase “safe” investments. If the person represents a stock investment offering, then it seems like the market is just getting going and stocks are the place to be.
In other words, to a hammer salesman, everything starts to look like a nail.
Sorting the good apples from the bad
While there are many good advisers with extremely high ethical standards who use dinner seminars to find new clients, there are also many others with less than virtuous intentions who use them, too. Here are some ways to try to sort the good apples from the bad.
- Is the presenter a licensed financial adviser? If so, look them up on the SEC’s Investment Adviser Public Disclosure website or FINRA’s BrokerCheck.
- Do a Google search of the person and see if there are any skeletons hiding in the closet.
- Look up the company they represent and search them.
Anecdotally, there used to be many great financial advisers who used this dinner invitation system to get in front of people and find clients. Around 10 years ago it seems many advisers moved on from the strategy and went elsewhere for their marketing efforts.
In order to make these expensive presentations work from a profitable business model standpoint, these dinners can often be sales tools to sell high-commissioned products. Many presenters push products that maximize the YTB. That stands for Yield to Broker, which may not end with a good result for the client.
So, be cautious of a “Free Steak Dinner” offer. It could end up being one of the more expensive meals of your life!
The opinions expressed in this material do not necessarily reflect the views of LPL Financial. Securities offered through LPL Financial, Member FINRA/SIPC. Investment advice offered through SFG Wealth Management, a registered investment advisor. SFG Wealth Management and Synergy Financial Group are separate entities from LPL Financial.
-
5 Gifts the IRS Won’t Tax: Even If They’re BigGift Tax Several categories of gifts don’t count toward annual gift tax limits. Here's what you need to know.
-
The 'Scrooge' Strategy: How to Turn Your Old Junk Into a Tax DeductionTax Deductions We break down the IRS rules for non-cash charitable contributions. Plus, here's a handy checklist before you donate to charity this year.
-
IRS Says You Made a Tax Return Mistake? A New Law Could Help You Fight BackTax Law Updated taxpayer protections change what the IRS must explain on error notices and how long you have to respond.
-
I'm a Tax Attorney: These Are the Year-End Tax Moves You Can't Afford to MissDon't miss out on this prime time to maximize contributions to your retirement accounts, do Roth conversions and capture investment gains.
-
I'm an Investment Adviser: This Is the Tax Diversification Strategy You Need for Your Retirement IncomeSpreading savings across three "tax buckets" — pretax, Roth and taxable — can help give retirees the flexibility to control when and how much taxes they pay.
-
Could an Annuity Be Your Retirement Safety Net? 4 Key ConsiderationsMore people are considering annuities to achieve tax-deferred growth and guaranteed income, but deciding if they are right for you depends on these key factors.
-
I'm a Financial Pro: Older Taxpayers Really Won't Want to Miss Out on This Hefty (Temporary) Tax BreakIf you're age 65 or older, you can claim a "bonus" tax deduction of up to $6,000 through 2028 that can be stacked on top of other deductions.
-
Meet the World's Unluckiest — Not to Mention Entitled — Porch PirateThis teen swiped a booby-trapped package that showered him with glitter, and then he hurt his wrist while fleeing. This is why no lawyer will represent him.
-
Smart Business: How Community Engagement Can Help Fuel GrowthAs a financial professional, you can strengthen your brand while making a difference in your community. See how these pros turned community spirit into growth.
-
In 2026, the Human Touch Will Be the Differentiator for Financial AdvisersAdvisers who leverage innovative technology to streamline tasks and combat a talent shortage can then prioritize the irreplaceable human touch and empathy.
-
How Financial Advisers Can Deliver a True Family Office ExperienceThe family office model is no longer just for the ultra-wealthy. Advisory firms will need to ensure they have the talent and the tech to serve their clients.
