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The Loyalty Effect

  • Artikel

What's the value of great customer service and high quality?

Friday, I got a call from Ameriprise HQ telling me that my Financial Advisor was leaving the firm. I was taken aback. I have (or thought) I had a GREAT relationship with him. He and his wife have had dinner at my house and I've referred 4 clients to him.

Ameripise told me they had re-assigned me to an Advisor in Vienna, VA (simply put: not close to where I live). I said, "you need to do better than that" and the woman said she'd call back.

What did I do next? I hung up and called Josh.

"Dude, what is it?

  1. you are getting out of the financial advising business?
  2. you got fired
  3. you don't want me as a client anymore?

I was expecting a call from you."

He replied, "well, there's another option...I am legally forbidden from calling you to tell you. I am moving to another firm and can't reach out for 1 month."

That was all he could say (and on his behalf, I called the people whom I had referred.)

Last night, the new Advisor called to talk with us. "Honestly," I said, "we're probably going wherever Josh goes."

Now, that is loyalty, earned by years of hard work and dilligence.

Reminded me of a great book I read a few years ago called The Loyalty Effect which talks about how companies that foster loyalty are more profitable.

Looks like Josh has that system down. Let me know if you need a GREAT financial advisor and I'll hook you up.

Comments

  • Anonymous
    March 30, 2007
    Do you know exactly what you are paying Josh in fees? I know a lot of people that used an Ameriprise advisor and thought they had a great relationship with their advisor. Come to find out, they was paying way more in fees than they knew about. I suggest you ask Josh for a written list of all fees you are paying. See how much they add up to and look at this chart: http://www.retireearlyhomepage.com/advise.html I bet he never added up all your fees and showed you a chart like this. And isn't that what a 'financial advisor' should be doing? Did you know that people using these 'financial advisors' (that are really product salesmen) get much worse returns than people doing their own investing? http://www.bankrate.com/brm/news/BoomerBucks/20061206_investment_advice_a1.asp Did you know Ameriprise has 36 regulatory actions against them? I suggest you take a look at NASD Broker Check. They have payed hundreds of millions in fines. Ask Josh if he takes fiduciary responsibility for doing what is in your best interest when he sells you products. I can tell you he does not take fiduciary responsibility. If he says he does, get it in writing. Hopefully you haven't been sold any variable annuities. Please check into all this. Learn about all the fees you are probably paying. Are you paying loads? Are you in a wrap account? What are you paying in fund fees? Learn about all the hidden costs. Ameriprise brokers are taught how to hard sell products. They work from scripts. They are taught how to buddy up to the clients. Show a personal interest. That's what salesmen do. Please do some research. Years of retirement and tens or even hundreds of thousands of YOUR dollars depend on it. Please, don't let him smooth talk you. If you are afraid to ask him about all of this, he has done an excellent job manipulating you. I do not mean to sound confrontational. But I have seen way too many people that thought their Ameriprise 'financial advisor' was great when in fact they were paying through the nose and underperforming the market. Please, look into this.  

  • Anonymous
    March 30, 2007
    Hmm. As a client of a fantastic advisor (not Josh) and someone who has been around the industry for almost 10 years, I would say that clearly the person commenting above has <i>no idea</i> how heavily regulated and scrutinized the advisors are, and I would also say that she is being sold down the river on silly eTrade hype if she believes that she can actually select better investments than those a good advisor recommends and not pay fees for it (there are always fees). Let me repeat: THERE ARE ALWAYS FEES no matter who clicks the Submit button. Yes, you have to pay for expertise. That's the way it works, when you hire a professional. Much like... Microsoft "solutions"? It's not like buying a car, a single transaction where you can shop around the MSRP to make sure the car salesman gets no money for the sale. A list of fees will tell you nothing about your investments, except what you are paying up front for initiating the investment. A comparative chart of how much money you have made on those investments, a look at what future returns are expected -- that would tell you more about what you are getting for the fees. It's like looking at a chart of a human life cycle with no years attached to it. I suppose it all depends on the advisor you get; I'm sure some are less than scrupulous about selling products that are best for them, not the client. I would argue that this is true of any firm, actually. Josh, and the people who work for him in the past and present, are among the best in the business. And I'm not even an advisor, btw. Just someone who understands the value of a good one.

  • Anonymous
    April 01, 2007
    The comment has been removed

  • Anonymous
    April 01, 2007
    To add to my comments above, here is an interesting article from Warren Buffett: http://money.cnn.com/2006/03/05/news/newsmakers/buffett_fortune/index.htm

  • Anonymous
    April 01, 2007
    I think the question on my mind, Anne, is what is your interest in this? Why are you so passionate about it? I love it, don't get me wrong, but curious how/why you know so much?

  • Anonymous
    April 02, 2007
    (Shouldn't every investor know what I know?! Their financial future is at stake. How important is that?) But to answer: After reading a couple articles about how the 'financial advice' industry works, I wanted to learn more. I care about my financial future.     The more I learn the more I understand that, with a few exceptions, the 'financial advice' industry is pretty close to a scam. Most 'financial advisors' are brokers, pushing products as their main goal. They don't compare all products to see what is best for you. They set you up to buy their products, which is almost certainly not best for you but very good for them.   Or they put people into wrap accounts that charge a percent of assets year after year after year, even though the client needs and gets only a couple hours of attention a year. Think about it. People pay 1.5% of their assets ongoing...for what? Their portfolio has already been set up. So ongoing there is rebalancing and maybe a couple phone calls and....what? I have shown how that wrap fee adds over time. I frequently run into people that are paying terrible fees but don't have a clue that they are paying ANY fees. Ameriprise clients included. Especially. I suppose I have a sense of justice because it angers me when I see people paying literally hundreds of thousands of dollars over time for professional advice that gets them much lower returns than DIY'ers get. It also saddens me when I give this kind of information to people and they seem to be more interested in me than the information I am providing. Please, do your research on investing. That's what is interesting.

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    August 05, 2008
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