The pitches are endless. They come in the mail, online and on the phone. A so-called financial expert wants to help you plan for retirement, or manage your “senior savings.” And whether you consider yourself a “senior,” some of these services and offers can, and do, lead to trouble. That’s why the Consumer Financial Protection Bureau (CFPB) is trying to set standards for those who pitch themselves as “senior advisers” to 50 million older Americans.
They often call themselves Senior Financial Analysts, Senior Financial Consultants, Senior Financial Planners, Senior Wealth Management Analysts and the list goes on. CFPB found more than 50 different titles for those who try to advise older people about financial issues.
The CFPB points out that older consumers often have higher household wealth in the form of retirement savings, inheritance, accumulated home equity, or other assets. But there are also health issues and memory deterioration that make them easy marks. Some of these so-called financial consultants work the circuit of 55 Plus communities, senior centers and assisted living facilities. The CFPB says they offer “free lunch seminars,” which they bill as education, but are really tools for selling financial products and investments.
Research and interviews with consumers and experts led to a report: “Senior Designations for Financial Advisers: Reducing Consumer Confusion and Risk.” It makes recommendations for change to Congress and the U.S. Securities and Exchange Commission.
CFPB Director Richard Cordray said, “Today’s report underscores the need for consistent high-level standards of training and conduct for those advisers who want to acquire a bona fide senior designation.”
- Implementing rigorous training standards to obtain senior designations: The Bureau recommends that state and federal regulators implement rigorous criteria for acquiring senior designations, including specific standards for education, training, and accreditation.
- Setting strict standards of conduct for those using senior designations: The Bureau recommends that state and federal regulators set consistent and strict standards of conduct for those using senior designations. Such standards could include prohibiting senior designees from characterizing sales events as educational seminars, and selling financial products and services at events that are advertised or described as educational or informational events.
- Increasing supervision and enforcement: The Bureau recommends that federal and state regulators consider increasing existing supervision of and enforcement authority against misleading conduct by a holder of a senior designation.
What’s your experience?
What’s your experience? How have you dealt with people offering financial advice? Let us know.