Complaint Review: World Financial Group or Transamerica Financial Advisors

Quote: "Finance is ddifficult for professional individuals who spent years at a reputable University... How does the industry and our government allow, a teen or an under educated individual to go out into families homes and sell them financial tools and investments, with minimal knowledge and a one-size-fits-all kitchen table presentation......"

The above is quoted from the content of the complaint.

Let's suppose you walked into a brick and mortar giant insurance company and bought exactly the same 2 products, will you bad month the big corporation, or the insurance agent?

You do not need an advance degree to be an insurance agent.  You pass some exams, get some training, then you are licensed to sell.  Have you not met an inexperience car insurance agent?

The real complaint is to the insurance industry, and / or the government.

There is nothing to do with WFG nor multi-level company.

The rebuttal goes on and on about how fantastic WFG's products are, that the fees charged are a part of any financial product and the illustrations they run are legit. He implies that WFG's practice of using variable life products as retirement vehicles is not only good for clients but one of the best available retirement options. None of that is true. First of all,  life insurance is NOT and never should be sold as an investment;  not only is it unethical but according to FINRA and securities law it is illegal. Life insurance must be sold for the insurance component with any cash value accumulation a secondary benefit.  There must be a need for life insurance,  with the cash value a supplemental retirement fund to be used only when the need for life insurance diminishes.

The reason is that the life insurance component costs money that decreases the cash value, so for retirement purposes an investment account, IRA or annuity accomplish the same goals without the huge cost of insurance and account fees eating away at the cash value. The only reason to sell life insurance as an investment is the high commissions the agents receive compared to an investment account - it does not benefit the client but actually harms them by overcharging for fees that aren't charged with other products resulting in less retirement savings.  The illustrations constantly overestimate future returns but present them as a near sure thing. No where do they discuss the fact that a downturn in the market combined with fees can cause the policy to blow up and lapse causing a total loss of principal.  The illustrations just show very rosey projections of future market conditions.

Regardless, WFG hires very inexperienced advisors who don't know any better than to regurgitate the company presentation and recommend/sell variable life policies to everyone they meet. In reality,  variable life is not for everyone;  it has a very narrow target market for people who have maxed out their 401K and IRA contributions,  have a need for life insurance but have a fixed permanent policy already, and want additional tax-deferred supplemental retirement savings.  If any of those conditions aren't met, and very few people do, then there are better products that should always be recommended.  Retirement savings should always start by maxing out 401k contributions, then get an IRA which doesn't have the fees, followed by a fixed or variable annuity depending on risk tolerance and a need for guaranteed lifetime retirement income.

Educations savings are better met with Coverdell or state sponsored mutual fund savings plans. Life insurance should be met with whole or universal life first that is fixed and guaranteed because of the high risk of lapse with a variable life policy. WFG advisors ignore or just don't know all of the different variables that go into creating a proper life insurance and retirement savings portfolio, and instead just follow their uplines by selling variable life for all situations,  putting their clients' retirement savings and life insurance at great risk. This is exactly what happened to the OP as there were much better retirement savings vehicles that provide greater returns ad don't needlessly eat away at his principal.  Fixed annuities and variable life have their place in financial planning but WFG doesn't bother to teach it's advisors when they're appropriate and when they're not.

I have worked full time for this company for about a year now, and it is okay when someone talks bad about working for us because quite frankly most people are not cut out for recruiting, but to talk bad about our products is a whole different story. There are fees to the account, but every account has fees to them, the difference is unlike other accounts where the fees get you nothing, the fees of this account get you a life insurance policy, and an amazing one at that. I don't know what company your account was written through, maybe wrl, nationwide, pac life. Idc though because these accounts are amazing, if you don't believe that read the book "the retirement miracle". Once you're done with that you will regret it if you canceled that account. No one tried to rip you off, those illustrations are not bogus illustrations either, they are legitimate projections, including all of the fees and costs of the accouny, based on past market performance. And as far as the "letting just anyone join". We don't, I have had to agents I have tried to hire into my agency that I couldn't because they failed their background check, and the other thing is, just because we hire someone and train them does not give them authorization to run appointments until they have been approved by a senior marketing director or higher in the firm, the only way you can get approved is by proving that the trainer has mastered the presentation and has mastered the product knowledge. I'm sorry you felt this way, and I'm sorry if your agent did not present you with all of the information, but we are required to let clients know about the fees associated with the accounts, if he didn't file a complaint with the agent, don't bad mouths our companies products and services on ripoff report