Retirement planning for the financially irresponsible?

[NHB_MMA]

I have a couple friends I'd love to help out with retirement planning and they would likely do business with me, but I'm kind of left wondering what sort of products are ideal for such people. These people are financially irresponsible. A variable annuity or VUL policy come to mind because of the financial/legal safeguards, but I figured I would ask if others have ideas or experience with such a situation.

 

[somarco]

Best to walk away from folks like that. There are better prospects out there. "Friends" + "financially irresponsible" = poor clients.

As a wise man once said, don't cast your pearls before swine.

 

[Crabcake Johnny]

I hate to say this since they're friends of yours but Somarco is right - just walk away. If they're financially irresponsible you can sell them a perm life vehicle all you want. Most likely a few years later they'll cash it out and take a Bahama cruise.

On top of that if they're financially responsible they don't understand the market and investing. And you're gonna recommend a variable product? And they're friends? You'll be the first person they call to bitch out if they lose one nickle in any given quarter.

 

[NHB_MMA]

Best to walk away from folks like that. There are better prospects out there. "Friends" + "financially irresponsible" = poor clients.

As a wise man once said, don't cast your pearls before swine.

I really want to help the one guy if I can. I truly don't think he would blame me for bad market results. He has invested before...only he decided to talk his retirement out to buy a motorcycle and pay penalty tax. At heart, he's a good guy. He knows he was stupid to buy the bike. He wanted to invite me to a party at his place of work and introduce me to people in his company to network. He is truly trying to help me get off the ground and I would like to do something if I could.

I visited the other guy tonight and had the first presentation out by myself. It was interesting. His girlfriend may be open to doing something, but I kept getting "why do I care about retirement if I'm old and I can't enjoy it" and "I've got the military to give me a funeral, so I want to die broke". It was an interesting appointment, but since he's been a friend for a while now, his girlfriend and I just sat there and laughed at his cynicism.

 

[NHB_MMA]

I hate to say this since they're friends of yours but Somarco is right - just walk away. If they're financially irresponsible you can sell them a perm life vehicle all you want. Most likely a few years later they'll cash it out and take a Bahama cruise.

On top of that if they're financially responsible they don't understand the market and investing. And you're gonna recommend a variable product? And they're friends? You'll be the first person they call to bitch out if they lose one nickle in any given quarter.

If he cashes out his perm life and heads for the sunny beach, that's on him. I would hope he would not do that, and would advise against it, but at least I know I got him started down the right track with the hope he would continue. In theory...the whole point of a person such as myself is to help advise him on the variable aspects of a product and the choices he should make. For a few basis points, he can have guarantee in a variable annuity that would ensure the value never decreases. It's not worthwhile for everyone, but maybe for him. Anyway, I'm going to do a comprehensive fact finding interview and see if something works and network with his connections.