Content provided by Michele Prell, New Business Manager

I recently completed my annual review of insurance products with my insurance agent. I consider my insurance agent to have a “crossover” profession—he insures my house, my car, and my life but can also be an outlet for investments and possible future/retirement planning. Having this crossover ability can be helpful for many people, especially those who might not have the knowledge or other contacts in the investment industry.

As we were reviewing my insurance and investment prospects, one of the questions that he asked me was how much my husband and I were contributing to our 401k plans at work. My husband has just started to contribute (mostly because I keep nagging him that he needs to), but I, however, was extremely proud when I told our agent that I contribute 10% of my annual income. I was floored when he said that it was 10% too much.

I was curious as to his reasoning, and asked him to explain. He proceeded to tell me that I should contribute to a Roth account instead because my tax bracket is lower now than it will be when I retire. I almost fell off my chair! After recently passing my Series 65 exam, I know that many tell clients to MAX OUT contributions to their 401k and that contributing to a Roth account may only benefit some people when they retire. There will be many people (myself likely included), that won’t be making nearly as much during their retirement as they currently do.

He also said that I should be investing directly in mutual funds, specifically American Funds, which he could sell me. Since I know that I can open an account through CLS and have the benefit of purchasing F shares, I asked him what share class he sold. His face went blank, and he asked what I meant. I told him that at CLS, we provide portfolios of either A or F shares. He then asked me the difference between them. It was at this point during our meeting that I decided to let my insurance agent stick to what he knows best: insurance.

As comedian Bill Engvall says, “Here’s your sign.” What concerns me is that there are many people I know, my mother for example, who don’t have a background in the investment industry but are probably being subjected to similar conversations. I wouldn’t want someone handing out information to my mom that doesn’t match her lifestyle and investment ideals. Thankfully, if I’m not comfortable, or confident that I can help her, I have a whole office building and list of professionals I can recruit for help. It is my hope that other people look for the same assistance when making investment decisions. And overall, if you want investment advice, look for a registered investment professional.