Hello,

My wife and I have several friends who have used Primerica's services and who submitted our names as referrals.

We were eventually contacted by a representative who referred to herself as a Financial Services Advisor. My wife and I both have great jobs that we enjoy immensely, but last year we decided to return to Graduate school to receive further training in our respective fields, Public Health and Economics. We will both be attending UNC-Chapel Hill starting in August, she in a Master's program and me in a PhD program. I plan on conenctrating in Financial Econometrics which is why I find meeting with different financial services professionals educational.

I also am obsessed with personal finance and try to learn everything I can about the field and am even considering pursuing it part time through school. Thus when this Advisor called I was very excited to hear her methodology and planning strategies to supplement my own understanding.

She came and was very pleasant and seemed knowledgable about the generalities of personal finance, e.g., basic absolutes like consumer debt reduction and refinancing, insurance as an income substitute for the loss of a primary breadwinner, stock market average return of 12% (since the Great Depression) and, her favorite, the "rule of 72"as a close approximation to doubling time given an expected return--every undergrad business major's crutch when they didn't have a calculator to actually compound interest.

However, I was disappointed in how little detail she offered about the subject. Still, I gave her all of our personal financial data for her to do a Financial Needs Analysis (FNA). In our conversation, she intimated that the FNA was generated by a simple computer program in which she entered our data.

Again, this was a disappointment. I am very interested in Artificial Intelligence and Neural Network programs which use decision rules and iterations to complexity to pick stocks, hedge, forecast etc. I was also very surprised at her faith that this program would optimize my finances to meet my needs. Even ignoring the differences in people's goals and risk preferences financial optimization is very complicated both mathematically, institutionally (different products etc.) and with respect to taxes. I later went to Primerica's site and read the disclaimer that the FNA was not a financial plan. Fair enough. Again, certain basics like debt reduction don't necessarily need complicated planning.

As our meeting progressed she played the trump card of my ego. Complimenting me (and my wife) for our understanding of the material and for being in good financial shape, she invited us out to an overview seminar for becoming an Advisor like her. My wife was not interested at all but I was, given my interest in the financial training, licensing benefits, and part time work while in Grad school. I asked several questions trying to get a feel for the structure of the position.

She was very polite but teetered on being vague. She was

straightforward about the position being commission-based. She did show me the commission schedule for selling certain products. The commissions were, in my not necessarily informed opinion, high for the products sold. I am not very familiar with the insurance industry structure so I do not know how closely their commissions align with Primerica's (Traveler's actually producing the product). Like the insurance industry, though, she showed me that Primerica Advisors do pass on an override to their uplines.

Again, these figures seemed excessively large for the products being sold. This is the first way in which I think Primerica deviates from the industry norms. The commission schedule and ratio of override to the selling agent's fee is closer to 1 than 0. This is very odd and is the reason why people think that Primerica looks more like an unsustainable pyramid/MLM than the standard commission-based industry does. That ratio close to 1 is what mathematically, when carried through to its logical end, makes the pyramid unstable and requires constant recruiting. It also, in theory, inflates the price of the product, but at that time I had not seen prices and could not judge.

I have no major problem with MLM. I do not have the type of personality for it but I can see how others would. If the product is legitimate and you don't mind the outlook of and MLM then I am all for it. I pondered and decided that if their products were strong enough then there would be room for someone like me who would not be interested in "growing my business" but would enjoy working with interested customers in this area for education and income.

So interested enough, I went to their orientation meeting with about 10 other people in attendance. At this point I became disillusioned. There were several aspects of the meeting which I personally did not like. Again, there are plenty of people who do not mind the things I am going to talk about and that is fine--simply, we are different people and if they enjoy it then Primerica is fine for them.

I do not like motivational speakers. I cringe. I cannot be swept up in enthusiasm. They make me uncomfortable because they are trying to make me feel a certain way. Upon realizing their attempt my mind goes contrarian and cynical. They are fine people and if they truly motivate other people then fine also. But they are not for me. I especially don't like clapping on a whim.

They attempted to motivate us with several different things besides their raw enthusiasm. First, they gave broad overviews of their product. Basically, these were numerical stories of people who had used Primerica's services and realized monthly savings and financial security. Because the company is relatively young with regard to a person's lifespan they could not show us end results, for example, estate values of someone who had been with them since 1945, etc. They used what they called a "low" market return estimate of 10%. This is a fudge number that theoretically isn't too bad an estimate if considered over a lifetime of investing in equities (not bonds, not Treasury Bills Bonds and Notes, not the money market, not CDs, not currencies, not gold, not beanie babies, etc.). Given that these securities will be purchased as part of a diversified market-basket mutual fund, risk over a lifetime is relatively low.

The description of the product does three things. The speakers emphasize repeatedly "who wouldn't want to save this much money per month and also be creating a large nest egg". This, like in most other MLMs, is the phase where the recruits are convinced that the product is a sure-thing, i.e., it convinces them that they WILL make money. There is nothing wrong with this if the product is truly worth what people are willing to pay for it. Secondly, it convinces the recruits that THEY want to use the product, which, in an MLM, means commissions for someone. Lastly, the product description reveals that that customer is not just buying something but saving money. This makes the product appear as an act of charity. (In theory, all good products, that are not sold by coersion, are helping people because it is something they wanted above all other things they could by with their money--and you, lucky angel, got to sell it to them. :) ) Indeed, basic personal finance is a very good product that anyone should feel good about selling.

Their second method of motivation was the income stream that someone could expect. We heard numerous success stories, both personal and anonymous. This is a classic motivational mechanism in MLM operations, and in industries in which the seller has to make the market. They gave statistics on how many Advisors/RVPs grossed (I do not remember if it was a rolling 12 month period) over $1M annually, $100K, $50, etc. Given that they have a lot of part time people, the data wasn't too bad. They also mentioned the great tax deduction of doing business.

The final motivation was a gloom and glory report. "Americans don't save enough. Social Security is worthless. Inflation is high. We hate our bosses. We hate our jobs. We want to be rich. America's way is to own our own businesses. Robert Kiyosaki says it's the only way to be rich. Thomas Stanley's sample of millionaires show that they are predominantly business owners. All other personally owned businesses are not as good, as easy or as cheap as ours, not Franchises, not Insurance and Real Estate Brokerages, none. Sandy Weill says we will be successful. Citigroup wants to open X number of offices in this area by 2005 and we're on track. Citigroup can't be wrong, too many assets."

The meeting ended with: "The key to success is coachability."

I could overlook the bad taste that this meeting left in my mouth, it is a personality issue.

What I missed in this meeting was any elaborate description of the specific products that we would be selling. What types of mutual funds? How many mutual fund families were available? I did have the term insurance point driven home clearly. What sort of mortgage scenarios are offered? And finally, and most importantly, what sort of financial planning would we be doing?

I was still not convinced that I shouldn't give it a try. I debated whether or not to reconsider American Express Financial Advisors since they pay you for training and pay for your licensing fees. But I wasn't ready to pass up this opportunity.

So I tried to ask more questions. What would the training be like? Do we have to sell Citi products or can we sell others? All the while they wanted me to fill out an Independent Business Application (IBA).

I did fill it out but did not choose to pay the $199 that night. Like most cold, sterile legal documents the IBA, gave me no warmth as it made clear that I was not an employee of Citigroup. No paternalism here.

I continued to ask questions of the recruiters and other individuals. I discovered that the classes and ongoing training mainly dealt with marketing and motivation. One person mentioned that he had learned about personality types and how to deal with them. This is when I decided not to be an advisor. I wanted to be trained in financial planning.

Overall, why I do not want to work for Primerica is their emphasis on selling and not on the product. I also list other reasons why I did not feel comfortable. Finally, I will list the general issues I have with the organization as a business.

They pushed recruitment very heavily with me, asking me for the contact information for friends and family. The IBA requested 6 references which I guess is more for marketing than for verifying my abilities. Every employer and Grad school I've been involved with has wanted 3 only. And, as they emphasized, any body could do this sort of work, regardless of background. This means that the references weren't to verify skill. And they need not verify my work ethic since they lose nothing if they hire a lazy individual. (They lose nothing because they are not taking a limited number of candidates. Hiring a lazy person doesn't preclude hiring the next hard worker. One might say "But they obviously want you to work hard." Yes, but verifying that I will or will not doesn't change me. And since it costs them nothing ( negative $199 maybe) to bring me on they will take the gamble--I may have a hard-working brother that I'll recruit.

They told us in the meeting that we would follow the FNA suggestions and buy Citi products in order to practice what we preach. Thus my theory on recruiting is that MLMs know that recruits themselves are actually the sure sale.

I did not like the recruiting focus. If someone does not mind it (For me, I do not like the way recruiting subtly changes my relationships with other people--others may not have this problem) then, they won't mind working for Primerica.

I did not like the speed with which they tried to commit me to signing the contract. When I wouldn't pay them the $199 up front (I didn't have my wallet nor my checkbook), they panicked about when they could meet with me again for me to pay them, assuming too much time would allow me to change my mind.

The income streams were in Gross numbers. I would like to know average net earings. And bragging about tax deductions misses the point. A person wants to get tax deductions on something they would already have purchased anyway. It doesn't make any sense to spend 100 dollars just to save ten.

Success based on coachability. Coaching is invaluable. As a PhD student I will work under several professors who will coach me in my research. However, coaching can also be a means of saying "be quiet, do what I say, and don't ask questions". It is a double edged sword. That coaching is meritorious presumes that the the coach is a good coach and that the activity that is being coached is worthwhile.

Some other points are economic. The Savings rate in the US is not bad if you change the definition of saving. Owning equity in a company is not counted as savings by the Bureau of Labor and Statistics. Thus stocks, penion plans, 401(K)s and regular mutual funds that don't hold bonds, do not get counted. Politicians and people selling products ignore this fact. US citizens have shifted much saving from banks to equities.

Social Security. That it will run out of money is used as a push to motivate people. First of all, insolvency, project to begin anywhere from in 20 years to 60 years, does not mean that there will be no money at all. If the Trust fund owes $100 in benefits and brings in $99 the the situation is not a disaster. The remedies are very easy but politically unpalatable: raise the tax by a meager such as %.5 (half a percent) or reduce benefits by a small amount. However, things aren't even that gloomy. The Social Security Administration's numbers use some of the most conservative assumptions. For example, they use the lowest productivity rate to predict future revenues. They just raised that estimate by 1% last month in a paper they published. This, while still 5% lower than almost everyone elses estimates (until recently the SSA had based it on numbers in the 1970s), adds 40 more years to SS. I absolutely agree that an individual should prepare for retirement without counting on SS, but to use it as a scare tactic is petty.

Referring to how so few Americans own businesses now compared to the turn of the century, the Regional Vice President asked rhetorically, "Where did we go wrong?" This is a silly statement. By using economies of scale, e.g., large factories, Americans have more and cheaper products than ever. So much of our industrial growth and everday amenities comes from the changing nature of the workforce in response to technological advances. This is not an opinion but an undisputed fact. As for everyone needing to own their own business there is a fallacy of composition. Owning is good for many. But it is not feasible for everybody to own. Finally, being a Primerica Advisor does not mean "owning your business" as the IBA intimates, nor does it qualify for what Robert Kiyosaki and T. Stanley are referring to.

Finally, the first simple rule in financial markets and business is that past perfomance is not a perfect indicator of future performance. Citigroup is not bound for the eternities. And CEO's opinions are always bullish. They have no reason to be negative about their businesses. What they say is not gospel.

I simply do not like when someone, talks to me assuming that I know no facts and will believe anything they say and agree with their logical conclusions.

Again these are minor annoyances. They are not substantial reasons for choosing not to work for Primerica.

Major issues:

My Advisor came back with the FNA and tried to sell me products. First, she wanted to me to refinance my house with Citigroup. The interest rate on the contract was 8.25% This was a week ago. Interest rates for individuals with good credit are easily 6.75%. My wife and I have perfect credit with no consumer debt. We currently have an interest rate of 7%--low enough that it is not worth the fees to refinance. I do not remember her refinancing fees. She said, "the interest rate doesn't matter". I did not believe she said it. I said "show me why mathematically". I am obsessed with these sort of numbers and do know what I am talking about. Everything else equal, INTEREST RATES DO MATTER.

She tried to show me an end total comparison but she did it incorrectly, apparently not knowing how to calculate what wasn't on her chart. We went through it several times, both by the Simple calculation and by my amortized schedule, before I convinced her that there was no way she could argue that she had a better deal.

Then she argued that we should refinance to pay off my student loan. My loan is a Stafford subsidized loan. I pay no interest. By refinancing I would be paying interest. Besides, any economist, businessperson, or financial analyst knows what leveraging is. My student loan is a free loan from the bank. To pay it off would be to loose all the returns I could get if I invested that money now in a mutual fund. This is economics 101. She should have known this as an advisor of financial matters.

She then tried to convince me with the bimonthly payment plan. My wife and I generally make 3 extra payments a year. Whenever we want we change the amount direct debited as a mortgage payment. But again, paying off early is not always the best option. With the tax deduction our real interest rate is around 6.25%. This cheap loan is great for investing in assets which return well. Since the market has been so rough, though, we have chosen to put more money toward our mortgage than the stock market since doing so is like a 6.25% savings account. When safer growth picks up again we will stop this and again put our money in assets that pay better. A financial advisor should know this.

She also tried to sell us several Salomon Smith Barney Funds which had the biggest loads I had ever seen. Several of the returns were mediocre and we decided to stay with ours.

Finally, she tried to sell us term life. I have no major issue with their preference for term over whole life. Usually, term is a big saver. She forgot that our companies give us policies worth two years of salary. ( She doesn't know we are quitting in several months). I told her I'd like to compare premiums. I did late last week and her premiums were between 30 and 70% higher than ones we got on Quotesmith, from my Dad's insurer, and from an advertisment in Kiplinger's.

So my major problems are that the products are more expensive than they should be and that she was not trained to advise. In the case of the mortgage, it was absurd that she even tried to have us refinance.

Poor advising can cost someone more than expensive products. As mentioned above 10% isn't a bad return. But it is over a lifetime of growth that an individual can really expect that to be the average. During a 5 year period that cannot be expected. For example, Kiplinger's lists best performing mututal funds by category, growth, value, Tech sector, blue caps etc. In most of those categories since the beginning of this year, the rolling 12 month averages for the funds have been very negative with only 5 to 10 funds being positive. I asked my advisor if she would recommend to a client who is anticipating retirement in three years that he move some of his assets into safer, lower earning funds like bond funds. She said she didn't think so, not realizing that this is one of the most standard pieces of financial advice given. And possibly the most important since having the nest egg wiped out at that age by a recession or poorly managed fund is a disaster.

If Primerica would lower their fees (maybe they are so high to support the MLM) and would train their people to be real advisors, not marketing unnecessary products, then I would have no major problem with them.

One final point. Before I came to post here I read a few other posts. One argument that was mentioned was that Primerica was good for people because they wouldn't prepare financially for their futures other wise. I do not disagree that the Advisors at least motivate people to think more carefully about their finances. But this does not justify the poor advising and the expensive products. There are other ways to help people. An ethicist would think little of a Doctor who marketed a product that wasn't absolutely good for a patient just to get the patient to think about his health.

Thank you for your time.

Paul

Roanoke, Virginia

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14 Updates & Rebuttals

April

Waldorf,
Maryland,

Primerica's Disclosures and other import information!

#2Consumer Suggestion

Sat, July 20, 2002

Have any of the people rebuttaling for the company read their disclosures? I seriously doubt it, or you would not be here defending them. For starts in NY, as someone mentioned before, their term-life is underwritten by National Benefit Life Insurance. To the people responding that Primerica's 9.0% financing is better then their current 7.9% or simular, what the hell are you thinking? If you really knew anything about finances, then you would know that you pay it, you pay it. If you pay on time with the 7.9%, then you pay the additional 7.9%. You can infact pay earlier and yes, that will lower the total amount of intrest occured. So, why take a hire percentage rate, because Primerica want's you to believe that this will save you money in the long run. Yeh, whatever. On any given financial contract, the have the total amount of the loan, the total intrest amount over the said time, and the overall total. It doesn't change because PFS says so. As to Primerica's disclosures, I am following this with the exact wordings in their privacy statements. Then after you've read it, try defending them then. Subsidary of Citigroup: Primerica and its affiliates are subsidiaries of Citigroup, Inc. Each subsidiary of Citigroup, and not Citigroup itself, is responsible for its obligations to its customers. Insurance and securities offered through Primerica companies are not deposits. There is no bank guarentee. They are not FDIC insured. Securities may loose value. FNA'S: Representatives are not financial planners, investment advisors, finacial consultants or other specialists who provide finacial advise and whose compensation may be unrelated to sales. Personal Income: The earnings listed accurately demonstrate the range of earnings achived by top earners in our sales force of more than 100,000 reps. Most RVP/Representatives do not achive these levels, so you should not consider these results any guarentee that you will achive any specific earnings level. Your earnings are dependent of your own effort and abilities. Actual earnings also depend upon the organization size that you build, the number of sales and override commissions you earn and the efforts of your downlines. The earnings shown represent gross income only. So basically, the FNA's have no clue what they're doing. The reps are working on a pyrimid with no future. Citigroup is the parent company, but will not be held responsible for PFS problems. PFS is not FDIC insured so screw you and your money. Finally, Don't trust ANYTHING they try to sell you, none of it is really true nor will they be liable for all our looses, and there will be looses. HA-HA. Understand now? How's PFS stock anyone? Did you know that there over over 500 complaints on Primerica on a site called deferred.com? Those are just the consumer complaints. There are much more for former and current reps. Did you also know that in 2000, a woman in Canada finally stood up against PFS. She found out that in accordance to the Employment Standard Acts of Canada, she had to be paid for training that was completed. PFS refused, so she took them to court. She won. The US Employment Standards Act are primarily the same. It states, if you successfully complete a training peroid for a company, that the said company has to pay you a resonable amount of pay for that peroid of time. Where do you think PFS would be if every rep, agent, etc. took legal action against PFS? Exactly. A pyramid scam is illegal and PFS runs one. No more no less.

Paul

Roanoke,
Virginia,

To Ken from San Jose

#3Consumer Comment

Thu, July 18, 2002

Ken, Your points are all close to the mark. One, needs clarification. Prepaying a loan is nothing new. I am beginning a PhD in Financial Economics and I can tell you that interest rates are still the most important point in judging mortgages or any loans. Anyone can prepay any loan (unless there are prepayment penalties or other odd terms usually found in sub prime lending) and save money. A borrower does not need a special program to do this. In fact the special biweekly programs usually cost additional fees. All one need do is make extra payments. Why interest rates still matter: Given that two people with two different loans for the same amount and term make the same extra payment, which as I said is free to anyone without a special Primerica $MART loan, they will still have the same amount of principle remaining at the end of the first period. Interest is then charged on the remaining principle, adding to it. So if one loan has a higher interest rate then more interest will be added to their loan. They will pay more in the long run for their mortgage. Primerica deceives people by showing that they will pay less total on their mortgage with the $MART loan that has higher interest. But they are comparing it to a loan that doesn't make extra payments. Since most anyone can make extra payments on their own, interest rate then again matters most again. Paul

Ken

San Jose,
California,

There is SOME truth to what you say

#4Consumer Comment

Wed, July 17, 2002

I have been dealing with Primerica as a consumer for several years. I have been to meetings, too. There is some truth to what all of you are saying. Primerica meetings are very much motivational with a lot of RAH-RAH. This is what works for them and I can't fault them. I don't like it very much but it is somewhat effective. To each his own. It is true that most representatives don't remain as representatives. Every representative can be successful, but as with any other business, you have to pay the price. For some Primerica representatives the price is high. I would guess that about one in twenty actually last beyond a year in the business. It is true that some Primerica reps, including very successful reps are not always trustworthy. I did not say they are not honest. Most I have met are honest. Being trustworthy involves far more than honesty. It involves responsibility. Some Primerica reps are not responsible. But you will find this in any organization. It is true that there is some hypocrisy in statements often used by Primerica reps. I find this in most all sales people who are zealous. I believe the buyer must beware. We can't count on the fox to guard the hen house. It is helpful that the insurance and securities industries are highly regulated. I have found that Primerica reps are taught about compliance and compliance is emphasized. They are also taught scripts and whenever sales folks memorize scripts, the consumer must pay closer scrutiny to what they say. Even vice-presidents don't always understand what they are saying. It is true that Primerica reps are salespeople first. They just happen to be licensed to deal in financial products. This is no different from any other financial services company. It must be stated that it is true that all insurance is not alike. The insurance industry would like you to believe otherwise. Primerica policies, for example, do not contain a "war clause." This makes a difference. The consumer must choose. The biggest difference I see with Primerica is if one follows the plan, Primerica believes you won't need insurance forever. No other insurance company will preach this. It is true that ALL MORTGAGES ARE NOT ALIKE. The mortgage industry has brainwashed most Americans. The only things most people are trained to think about are interest rate and points. Most finance majors will tell you what Primerica teaches about scheduled interest is absolutely true. For years I paid an extra $200 a month in principal. I didn't know my interest wasn't recalculated but once every five years. I had been paying interest on principal that had already been paid off. This is true until the mortgage is paid off in full. This is a big secret banks don't tell you about. It applies to car loans, too. Every contract is different. YOU MUST READ YOUR LOAN CONTRACT. It is true that Traveler's mortgages have a pre-payment penalty over the first three years. They also charge points. But it is often still a good deal! It is true that Primerica is corporate America. Primerica reps will rip on corporate America in meetings, but I have friends who are Primerica reps and clients. Primerica is every bit corporate America, for better or for worse, as every other big company. Dealing with them is just as frustrating as dealing with any other insurance company. THE BOTTOM LINE: Primerica is a reputable company, but it won't lead you to NIRVANA! Primerica has its flaws. A consumer looking for a good deal should still look at Primerica. They do teach sound principals you won't find anywhere else.

Paul

Roanoke,
Virginia,

make extra payments

#5Consumer Comment

Tue, June 11, 2002

Hi L from Erlanger, Our experience actually turns out to be fun in a way. You're right in your response to Kendra. I make several extra payments a year. Using Excel to check against my lender's record to make sure that the principal is dropping in addition to interest paid on that smaller principal. If you have a 7% interest loan and make extra payments the effect is the exact equivalent of putting that money into a 7% guaranteed savings account. And the banks don't charge any fees for doing this unless your contract states otherwise. Take care,

Nick

Ft Worth,
Texas,

This primermica crap needs to stop !!!

#6REBUTTAL Individual responds

Tue, June 11, 2002

My name is Nick. I am an Executive at the Lockheed-Martin Military Weapons Division. I make a pretty comfortable living out of the dieing of people who jack with the U.S. you could say. I was my son's house the other day, and this pitifull guy wearing a Hot Pink Izod Shirt, Braxton Blue Jeans, and a pair of velcro Pro-Wings came by. I guess this guy gave my boy a load of crap, about how he couls turn him into a millionare. I sat back and tried not to piss my pants laughing at this joker. He goes off about how he used to work as a executive for the 7-11 Co. but his buddy got him into the "business", and he made $150,000.00 in his first year, basically going door-to-door selling his wares. What was the capper was when this clown pulled out some pampletts about how his company's stocks were on the rise. Now here is the funny part, when I looked at the pamplett there was a little disclaimer on the back that said something to the effect of, "Figures depicted in this pamplett don't reflect real averages". At that point I couldn't take it anymore, so I jumped in. I started asking some basic questions about how the stocks, IRAs, and Funds were working. This faggett was totally lost, and he introduced himself as a "Financial Super Genius" or some crap like that. This guys name was Gary Pushmouse. Well, I had enough of Pushcarts sh*t. I grabbed him by his collar, which ripped when I did, and threw him out of the house. -Nick

Erlanger,
Kentucky,

Kendra

#7Consumer Comment

Mon, June 10, 2002

Kendra. This sounds like Primerica jibberish. If I am correct, isn't the purpose of the bi-weekly plan to pay more towards your loan because that will bring down the principal balance which will result in less interest being paid due to the lower balance? And what do you mean about my loan having a pre-calculated interest and no matter what I do it won't effect how much interest I pay out? That's crazy. If that was the case, nobody could sell their house because they would owe all that interest and be in debt. Actually, I just pay an extra amount each month and have it applied to the principal, so by the end of the year I have paid an extra payment or two. This way I don't have to worry about anyone "sitting" on my payment. And if interest rate doesn't matter, why doesn't Traveler's have a lower interest rate? If it really means nothing, why not make it what the going rate is? I may not be a financial genius, but how is paying a higher interest rate, with high closing costs and pre-payment penalties going to help me? Maybe the whole bi-weekly thing you guys push, some how is a smoke screen to hide all the extra money people will really be paying out in the long run. If nothing else, I will wait for C-Midwest to rebute what you have said.

kendra

chandler,
Arizona,

MOST BANKS DON'T OFFER A TRUE BI-WEEKLY PROGRAM .

#8Consumer Comment

Sun, June 09, 2002

HELLO L FROM KENTUCKY AS FAR AS DOING A BI-WEEKLY YOURSELF ON YOUR CURRENT MORTGAGE, THAT IS ALL IT WOULD BE IS JUST THAT. MOST BANKS WILL CHARGE YOU AN UPFRONT FEE AS WELL AS A MONTHLY FEE TO SERVICE YOUR BI-WEEKLY ACCOUNT. NOT ONLY THAT THE BANK DOESN'T POST THE PAYMENT AUTOMATICALLY ANYWAYS, THEY WILL HOLD ONTO THE PAYMENT AND THEN POST IT TO THE ACCOUNT WHEN THEY GET THE FULL AMOUNT OF THE MONTHLY PAYMENT,ALSO YOU ARE STILL PAYING PRECALCULATED INTEREST ON THE LOAN, IT DOESN'T EFFECT HOW MUCH INTEREST YOU WILL PAY OUT. YOU WOULD WANT A SIMPLE DAILY UNPAID BALANCE LOAN SO THAT YOU WOULD BE ABLE TO EFFECT HOW SOON YOU PAY YOUR PRINCIPAL BALANCE DOWN. IAM SORRY THAT THE REP DIDN'T EXPLAIN THAT TO YOU,BUT CALL YOUR LENDER AND ASK THEM HOW YOUR INTEREST IS CALCULATED ON YOUR LOAN. ON THE DAILY UNPAID BALANCE OR THE YEARLY UNPAID BALANCE, THEN DECIDE WHETHER OR NOT YOU FEEL THE INTEREST RATE MATTERS, AND ACTUALLY IT IS THE APR THAT CONSTITUTES WHAT YOUR PAYMENT WILL BE NOT THE NOTE RATE, AND USUALLY THE APR IS USUALLY 1-1.5% HIGHER THAN THE STATED NOTE RATE WHICH IS ON YOUR TRUTH AND LENDING STATEMENT. YOU NEED TO DECIDE WHAT IS MORE IMPORTANT,PAYING OFF YOUR HOUSE SOONER OR SAVING ON THE MONTHLY AND PAYING ON THE HOUSE FOR 30 YEARS AND PAYING 3XS THE AMOUNT THAT YOU ACTUALLY PAID FOR THE HOUSE. I CAN UNDERSTAND HOW YOU WOULD BLINK OVER THE INTEREST RATE, BUT THE BANKS HAVE CONDITIONED US TO THINK THAT THE INTEREST RATE AND PAYMENT DOES MATTER. THIS IS NOTHING AGAINST THE BANKS, BUT THAT IS HOW THEY OPERATE. HOWEVER, THE COMPANY OBJECTIVE WITH PRIMERICA IS THAT THE QUICKER YOU ARE OUT OF DEBT ON YOUR HOUSE AND CREDIT CARDS, THE MORE YOU CAN PUT INTO RETIREMENT. WHEN WAS THE LAST TIME YOUR LENDER TOLD YOU THAT THEY WANTED TO HELP YOU PAY OFF YOR HOUSE SOONER AND SAVE MONEY ON THE INTEREST OVER THE LIFE OF THE LOAN? NOT ONLY THAT YOU WANT TO ASK YOURSELF DO YOU WANT YOUR LENDER EARNING INTEREST ON YOUR PROPERTY TAXES AND INSURANCE? JUST SOME QUESTIONS TO ASK YOURSELF. LOOKING FORWARD TO YOUR RESPONSE!

Erlanger,
Kentucky,

Same exact experience as Paul

#9Consumer Comment

Sat, June 08, 2002

Hi Paul. I just want to let you know that I had a Primerica Rep try to pull the exact same crap on me a few months ago. She tried to refinance my 7.2% mortgage with a 9.0% one, and then used the interest rate doesn't matter and brushed over the high closing costs when I questioned the logic behind spending so much extra money when she is suppose to be helping me save money. What was really stupid was when she did that FNA on me and found out that I had no credit card debt, except for a hot tub my mom had charged on one of my cards and was paying off every month religiously, she said I needed to go ahead and consolidate that with the refinancing, and pay that off too. First I asked why am I paying off my mother's bill, and secondly if I did, how would collect it from her. She basically said I could figure out some interest rate and have her pay me directly. Then came the old Smith and Barney Mutual Funds. She whips out these pamplets and points to these numbers and brags about how all these funds are so great and "look how they kept their value even after the 9-11 tragedy when other funds' values have headed south". Come to find out, all those numbers were generated well before 9-11, with the oldest being Jan 2001. Now these could be perfectly good funds, I just didn't care for the deception about how they had withstood 9-11 when they fell just like every other fund out there. She also attempted the "benefits" of the bi-monthly payment plan they offer. I asked why can't I just keep my own mortgage and do that myself. She didn't have too much left to say that sounded anywhere near an intelligent, well informed response. So Brent, it seems to me that this sort of crap financial advice isn't coming from some rogue, greedy Primerica Reps who are going against company policy and giving Primerica a bad name. I think this is company policy and this is how they are trained. There are too many examples to think differently. How else would you get people to knowingly buy this junk, unless you did in fact lie/mislead them, and lead them to believe they were buying something else? And for god's sake you Primerica Minions of Satan, when somebody asks a question on this site, answer the d**n questions with a real answer instead of p***y footing around it and saying, that may have happened but it certainly isn't company policy. It is company policy because it happens the exact same way everywhere. I guess you probaly can't defend yourselves properly, because if you open your month too much, you all sound even more stupid.

Erlanger,
Kentucky,

Same exact experience as Paul

#10Consumer Comment

Sat, June 08, 2002

Erlanger,
Kentucky,

Same exact experience as Paul

#11Consumer Comment

Sat, June 08, 2002

Paul

Roanoke,
Virginia,

"Helping a hardworking family make a plan to be financially successful is fun, rewarding and moral. "

#12Consumer Comment

Wed, June 05, 2002

"Don't blame Primerica wholesale, but even I don't absolve them completely; corporate profit and employee bonuses can make corporations be less that model citizens. That is why I am my own boss, not Primericas boy. As for products, again some representatives will try to put a square peg in a round hole. Most will do the right thing, but there are always people who will be excessive and use poor judgment. " Sure. My experience is anecdotal. But given the intricacies of financial planning, I believe there are mostly round holes and anyone without good training is using a square peg. "Primerica is not the K-Mart of all people for all things. Primerica offers its representatives the ability to make simple financial plans and the means to execute them. It is not a system or confidence game. " Exactly, and there shouldn't be a Kmart for financial services. Every plan needs to be custom built. I especially have issues with a computer algorithm method. Simple is fine for VCR remotes. Again, the point is that they need more training. "If you want a higher level of sophistication, please feel free to consult with a JD, CPA, CLU, CFP and pay the hefty fee, which even then generates actions that displease a consumer. " That's the point. For something serious like health I will pay a Physician. For finances it is exponentially worth the hourly (no agency problem, no conflict of interest) rate for a good CFP. In addition, for those who haven't resources nor even the notion to hire a professional there are dozens of legitimate free debt reduction and planning services (who encourage and aid in the purchasing process of life insurance). And public libraries are replete with resources that will help most people handle their finances. Stock-picking clubs for example are not dominated by upper-class, well educated individuals, yet the majority of them consistently outperform the S&P 500 and many professional fund managers. Most people who need more than that will have the means to hire a professional. This reminds me of another point. My loan had a prepayment penalty through five years. That is legitimate, but it is easy to find a loan without any. My planner never asked if we had any intention of moving, changing jobs, or refinancing later. It doesn't get any worse than this. Simple logic requires that she ask before pushing a prepayment penalty loan. "I am quite sure CitiGroup has not pegged their billions on inside sales to gullible new Primerica representatives." Whoever said this? Logically, the people who care are the ones at the top of the pyramid. If you look at the 10K for Citigroup you can see how proportionally small Primerica is to them. On some levels Primerica is competing against its sisters. "Helping a hardworking family make a plan to be financially successful is fun, rewarding and moral. " Absolutely. I am part of a program that offers free basic financial advising services to low income, innercity families ( I currently live in DC). What makes it especially rewarding is that I don't push products that I don't understand and that would hurt my clients. The basic principles are easy to teach: reduce consumer debt, budget, save on a schedule, buy a house-don't rent, use all tax deffered options for investing, and risk reward tradeoffs in investment vehicles. The key is not being constrained by the need to sell products. This is a terrible agency situation. In fact the nobel prize economics this year focused on this problem partially in dealing with assymetric information and conflicts of interest. As for the character of Primerica reps, I believe humans are complicated. I believe that both greed and altruism can be motivations at the same time. But to claim altruism as the sole motivation is absurd. If that were the case then one would want to become as educated as possible--not on selling but on personal finance--in order to help people to the utmost. They would join groups that train well and offer these services for free. "I have no advice for Paul in Chapel Hill." This didn't make sense. Did you presume that your audience was expecting to hear advice for me? That is a fluff statement...oh wait, I get it, this was where you wanted to begin reaming me and you needed some intro to change the subject. :) "I do hope his well-written b***h letter about Primerica is part of his dissertation;" Do you really hope that? Is that what you meant to say? Why not be more frank? Your formula is simple: try to sound intelligent and sophisticated and at the end pull a visceral punch. You lost your cool--too emotional. Personal attacks are irrelevant to this debate but for whatever reason what I wrote caused you to not like me, to want to one-up me. To carry on a serious debate you have to be nonchalant, indifferent. "b***h letter"? ??? " if not, he needs to sign up for a second concurrent degree program." Really? Why? Acually, I am half way through my MS in Statistics, and hope to get an MA in applied Anthropology while at UNC. :)

Paul

Roanoke,
Virginia,

"Helping a hardworking family make a plan to be financially successful is fun, rewarding and moral. "

#13Consumer Comment

Wed, June 05, 2002

Midwest,
Illinois,

right ...Who was terminated? ..they lie and misrepresent it to show it in a "good" light.

#14Consumer Comment

Wed, June 05, 2002

:Representatives of Primerica are independent contractors. They do no represent the policies of the Mripenica and its related companies, nor other representatives. Individual representatives can misrepresent the facts and be general jerks on their own without Primerica corporate permission. So are you saying us that Primerica exercises no control over representatives who deliberately miscompare insurance types, misrepresent mortgage numbers or the 'opportunity'? :If reported to Primerica, any illegal or misrepresented information would cause the representative's Primerica contract to be terminated. I have posted scanned proof of deceptive information being given to me by Primerica, and I have more. Who was terminated? :It's a function of state and federal law, not company policy. As for recruiting, yes, some representatives can be tacky and outright deceptive So who gets terminated when they're deceptive? :Don't blame Primerica wholesale, but even I don't absolve them completely; corporate profit and employee bonuses can make corporations be less that model citizens. That is why I am my own boss, not Primericas boy. So why can they fire you? :As for products, again some representatives will try to put a square peg in a round hole. Most will do the right thing, but there are always people who will be excessive and use poor judgment. So who gets terminated when they use poor judgement and mislead a consumer? :Primerica offers its representatives the ability to make simple financial plans and the means to execute them. According to your website, you don't offer financial plans. :If you want a higher level of sophistication, please feel free to consult with a JD, CPA, CLU, CFP and pay the hefty fee, which even then generates actions that displease a consumer. Funny, I was told not to waste the PFA's time by consulting a family member, much less a registered professional. :As for product cost, Primerica offers AAA products at competitive values. Competitive? HARDLY! How is a 9% mortgage competitive, when my current mortgage is 7.9% and the market is at 7%? :How they do it is for some Wall Street financial analysis to determine. No, they lie and misrepresent it to show it in a "good" light.

Brent

Raleigh,
North Carolina,

Primerica representatives are not employees

#15UPDATE Employee

Wed, June 05, 2002

Representatives of Primerica are independent contractors. They do no represent the policies of the Mripenica and its related companies, nor other representatives. Individual representatives can misrepresent the facts and be general jerks on their own without Primerica corporate permission. If reported to Primerica, any illegal or misrepresented information would cause the representative's Primerica contract to be terminated. It's a function of state and federal law, not company policy. As for recruiting, yes, some representatives can be tacky and outright deceptive -- as in all car salesman. Don't blame Primerica wholesale, but even I don't absolve them completely; corporate profit and employee bonuses can make corporations be less that model citizens. That is why I am my own boss, not Primericas boy. As for products, again some representatives will try to put a square peg in a round hole. Most will do the right thing, but there are always people who will be excessive and use poor judgment. Primerica is not the K-Mart of all people for all things. Primerica offers its representatives the ability to make simple financial plans and the means to execute them. It is not a system or confidence game. The products are real and reputable with the financial industry and consumers; I regret that some people representing the products are not reputable. Recruiting is a natural function of the sale industry -- especially the financial industries. I am quite sure CitiGroup has not pegged their billions on inside sales to gullible new Primerica representatives. If you want a higher level of sophistication, please feel free to consult with a JD, CPA, CLU, CFP and pay the hefty fee, which even then generates actions that displease a consumer. As for product cost, Primerica offers AAA products at competitive values. How they do it is for some Wall Street financial analysis to determine. Last, I have been an accounting and tax professional for almost thirty years, always coloring between the lines, never fully able to execute the advice I gave to clients, just able to note their debt and future needs as a point to be addressed by some one else, or not at all. It was not fun. Helping a hardworking family make a plan to be financially successful is fun, rewarding and moral. I have no advice for Paul in Chapel Hill. I do hope his well-written b***h letter about Primerica is part of his dissertation; if not, he needs to sign up for a second concurrent degree program.

Reports & Rebuttal

Complaint Review: Primerica - Virginia

*UPDATE Employee: Primerica representatives are not employees

*Consumer Comment: right ...Who was terminated? ..they lie and misrepresent it to show it in a "good" light.

*Consumer Comment: "Helping a hardworking family make a plan to be financially successful is fun, rewarding and moral. "

*Consumer Comment: "Helping a hardworking family make a plan to be financially successful is fun, rewarding and moral. "

*Consumer Comment: Same exact experience as Paul

*Consumer Comment: Same exact experience as Paul

*Consumer Comment: Same exact experience as Paul

*Consumer Comment: MOST BANKS DON'T OFFER A TRUE BI-WEEKLY PROGRAM .

*Consumer Comment: Kendra

*REBUTTAL Individual responds: This primermica crap needs to stop !!!

*Consumer Comment: make extra payments

*Consumer Comment: There is SOME truth to what you say

*Consumer Comment: To Ken from San Jose

*Consumer Suggestion: Primerica's Disclosures and other import information!

14 Updates & Rebuttals

Primerica's Disclosures and other import information!

To Ken from San Jose

There is SOME truth to what you say

make extra payments

This primermica crap needs to stop !!!

Kendra

MOST BANKS DON'T OFFER A TRUE BI-WEEKLY PROGRAM .

Same exact experience as Paul

Same exact experience as Paul

Same exact experience as Paul

"Helping a hardworking family make a plan to be financially successful is fun, rewarding and moral. "

"Helping a hardworking family make a plan to be financially successful is fun, rewarding and moral. "

right ...Who was terminated? ..they lie and misrepresent it to show it in a "good" light.

Primerica representatives are not employees

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