On April 13, Dateline NBC featured a story on the unscrupulous practices of some investment advisors that convince older people to put their money in investments that never will go down in value but only go up.

The tradeoff for these types of investments is that the majority of the clients’ money is tied up for many years and there are often steep penalties to get the money out if there was an emergency. The program highlighted how some of these advisors would not really explain this to the clients but only focused on the benefits of the investment. The reason for that is that the advisor gets paid hefty commissions for the money that gets invested in these products.

This story hit home with me since I have spoken with many people in the Tomah area over the years that own these types of investments but have no idea how they work or the fact that they are subject to large fees if they want to pull a large chunk of their money back out. Unfortunately, many times there is nothing we can do without the client incurring the large penalties.

My advice to everyone is to make sure you understand the risks involved with every investment before you decide to invest and find out how your advisor gets paid. There is no such thing as a free lunch or “no risk.” You have a right to know as a prudent consumer.

Lenny Bakken,

Tomah