Dave Ramsey and ELP kickbacks...ethical? | Bloggers Lair | Yakezie Forums

I just called them ELP advisers; I don't know what they call themselves. That sentence should read fixed and variable annuities – I edited my post a few times, and apparently goofed up that sentence. Anyway, a fixed annuity makes sense when rates are higher. Right now, I agree, they don't make all that much sense. Ramsey's advice in regards to fixed or variable annuities does not change, however.

I don't listen to Ramsey's radio show. The last time I listened to Dave was in a PF class in high school; I think we watched every single one of his FPU videos. I've caught a few interviews of his on the topic of annuities in which he just tells people to invest in "a good growth stock mutual fund" and then something about "12% returns…yadda, yadda." I specifically remember a YouTube video where he's on TV telling someone who is very close to retirement age to keep 100% invested in stock funds rather than a variable annuity. No mention of any fixed-income exposure at all. Dangerous advice.

Finally, there is not a single tangible difference between a fee-only adviser and a commissioned adviser as it relates to Dave's rationale for using commissioned advisers. He states that people should use a commissioned adviser because it means that they have to speak with their adviser before buying or selling a fund. That is in no way different from the experience with…say, a fee-only RIA. The only tangible difference is that Dave would face tougher disclosure rules, and he likely wouldn't make nearly as much money (money which comes directly from his followers' savings) referring people to fee-only advisers.

Again, rejecting mathematics on a $10,000 consumer debt is a bit of a novelty – it's no big deal. Rejecting mathematics and logical decision-making on a multi-million dollar event (retirement) is foolish. It is even more foolish to PAY a supposed "professional" to make poor decisions on your behalf. Why pay a professional fee for what is the most amateur of advice?

Please let me know if you get in. I'd be interested to hear what funds you intend to sell to referrals.