November 14, 2008
I am a member of the Financial Planning Association (FPA) and 12 year veteran of the financial planning industry. I hold the following licenses: FINRA Series 6, 63, 65, 7, 26 and State of Florida 2-15 Life, Health, and Variable Annuity License.
I support the proposed rule to have the SEC oversee Indexed Annuity Sales.
In 2005 I received an invite to a local hotel to participate in "Continuing Education" on what were then called "Equity Indexed Annuities." To make a long story short, most of the attendees were life insurance licensees only and the "Education" was simply a sales pitch by a national company on how their annuities paid out the largest commissions. I was shocked to learn that independent insurance agents receive up to 10% commission on the product. That's $10,000 for one sale of $100,000! It is very easy to see why insurance agents use this product as a common "fix all."
In my years as a financial advisor, I have participated in hundreds of cases to help families invest for their future. Only in one have I found this product to be the most suitable. On the other hand, I have attended many insurance agent meetings and conventions where this product is used extensively.
As a CERTIFIED FINANCIAL PLANNERTM, I strongly recommend that index annuities be treated as securities. Thank you for your time and I would be more than happy to discuss my views further should anyone wish to contact me.
DAVE BROOKS, CFP (r)
CERTIFIED FINANCIAL PLANNER (tm)
District Advisor and Principal
First Command Financial Services, Inc., parent of
First Command Financial Planning, Inc.