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Your CPA Is Not Your Financial Advisor: Shootin' It Straight with Stan

Your CPA Is Not Your Financial Advisor | Shootin' It Straight with Stan

Today's topic is a good one. It's your CPA is not your financial advisor. I got a call the other day, and this is not a unicorn call. I get these all of the time. The lady that called me was, unfortunately, just widowed. She goes to her CPA to get the taxes done and get everything in order and the CPA does the taxes and then did an, "Oh, by the way" at the end of the meeting, "Oh, by the way, Mrs. Jones, tell me about your finances, " and proceeded to sell her an annuity that she did not need, of which when she called me I said, "Free look it and get your money back," which she did and the CPA shot me some hateful email of which I said, "Godspeed, I wish you the best." That happens to me all the time. But I wanted to address this because this is very important.

In the annuity industry, and I've always talked about bad chicken dinner seminars, which has now turned into expensive steak dinner seminars where you get this thing in the mail, this postcard and you can go eat at Ruth's Chris or somewhere really nice that you would never go, for free, to hear about market volatility and how to protect your principle. That's an annuity sales pitch. They're going to pitch it or they're going to say, "Learn about taxes, we're going to have a CPA speak, etc." and it's just a bait and switch to sell you an annuity. That's happened in the annuity industry forever.

As I tell everybody, never ever take tax advice from anyone other than a CPA and a tax lawyer. Don't take it from an agent, but the reverse is true. Don't buy an annuity from a tax lawyer or CPA, tell them to stay in their lane. Now you have to say "Wait a minute. But I trust my CPA, she or he is very nice to me." I don't care if they're nice, couldn't care less if they make a really nice peach cobbler, which is my favorite dessert. I don't care. Even though I'd really like to have some peach cobbler right now. It doesn't matter. The reason that CPAs and those type of people are selling annuities, spoiler alert, guess which type they sell? Guess which type they're pushing. Yeah, you're right. Indexed Annuities. Again, I have nothing against Fixed Indexed Annuities. We probably sell more than anyone, but we sell  them correctly as CD products in efficient delivery systems for future income guarantees with Income Riders. But every single call that someone calls in and says, "Well, my CPA, they sold me an Indexed Annuity," it's always an Indexed Annuity. It's never an Immediate Annuity. It's never a MYGA, is never anything simple. It's the highest commission product on the planet, which right now is Indexed Annuities.

Your CPA should not be involved in your financial advice. Can they give you guidance on some things from a tax endpoint? Yes. But they do not need to be your financial advisor as well. Now a lot of CPAs, they'll play the semantics game, "Well, Stan, I saw where you commented on the CPA. I'm a CPA, but we have had an internal person in the same office that sells annuities and investments." Wrong. Okay? That's just moving the yes three card money in the sales world. CPA should do your taxes. That's it. If they can't make a good living doing that and doing your taxes, then they need to find another profession.

Think about this. If your CPA said to you after the meeting of doing your taxes, "How's your teeth right now?" and then they tried to sell you dental service or they try to put you in a multi-level marketing scam, what would you do? You would be like, "This person is an idiot. This person I don't trust anymore because they're trying to get me to sell multi-level marketing or do something that's out of their lane." Them selling you an annuity is the same thing, period. They can't explain what they're selling. I guarantee you that. CPAs are CPAs for a reason. They're good with numbers, they're good with math, they're good with figuring things out, they're good with taxes. They read, they're analytical, okay? They're not reading the policy. They don't understand how Indexed Annuities work, and option strategies, and caps, and spreads and all that stuff. They just don't.

As I always tell people, if you're getting invited to a bad chicken dinner or expensive steak dinner seminar, go there, swallow the food, and never swallow the pitch, period. Every single time. What makes me mad about the story that I told you about the widow, listen, this is how bad it was. She's 49 years old. Her husband passed away unexpectedly. She has four kids and the youngest age was seven. Very nice lady. I'm not sure she needs an annuity at all because, why? Less than 50 years old. We really have to make sure it makes sense for you. In a lot of cases, it does not. But an Indexed Annuity for her at the time her husband died, and she just buried him, and she just dropped the kid off at school, the seven-year-old, and went to the CPA and they had her sign paperwork for an Indexed Annuity. That's criminal.

That person should lose not only their annuity license, but I think the CPA world, whatever that world is, whatever that regulatory body is, they should come out and say, "You can't sell financial products in addition to doing people's taxes. If you have an agent offered to do your taxes, then you need to run for cover." Agents can't legally give tax advice. It always kills me all the time that there'll be a lot of these distribution companies, in our industry they call them FMOs or SMOs sales and marketing organizations, and some of these people will advise their agent army to hold social security workshops or tax workshops in order to get people in the door in order to then sell them an Indexed Annuity. That's criminal. That's crap. That's the reason that the annuity industry has earned its bad reputation.

There's not a one-size-fits-all product. In fact, a lot of times, a big percentage of the time when people call me, I'll say, "You know what? You don't need an annuity" or "You know what? You need to wait" or "You know what? You've bought too many annuities, you already own too many" because the annuity industry, their stomach starts hurting when you have more than 50 percent of your investable assets in annuities of any type. Now, can we get a little bit more than maybe push it to 55 or 60? Maybe. But I have to go to bat for you with the carrier to tell them why.

CPA's given you Indexed Annuity vice or trying to sell you annuity? No. Period. In my opinion, CPAs are so valuable. My CPA, love them, hug them, send them cookies and flowers. Why? Because they keep up with the tax law. They keep up with current legislation, they keep up with pending legislation. They try to escape where the puck is going to be tax-wise instead of behind the puck, they try to help me. That's what they should try to help you. If any CPA pitches you used to say, "Wait a minute, how do you have the time to then sell me an annuity? Shouldn't you be spending all of your time on tax law, all of your time interacting with your other CPAs to come up with best practices, so that you can take care of my situation and you can maximize my situation under the law and go and know gray areas? Shouldn't you, Mr. or Mrs. CPA, be focused solely on that? Shouldn't you be a specialist? Shouldn't you have the passion for the business that you're in and only do that, Mr. or Mrs. CPA? Why all of a sudden, are you pivoting and now you're an annuity person? Why is that? Are you not making enough money? Is revenue not high enough for you? Why do you have this other person now in the office that never used to be here that you now want me to go visit with after I meet with you so that they can review my finances? Why is that, Mr. or Mrs. CPA?" There's no good answer except greed, and greed is not a good answer because greed involves them parting money from you with a product that you probably don't need.

I'm passionate about this. I'm trying to clean this mess up out here. It's hard. It's hard enough with Indexed Annuity agents that have to score a 70 on a state test to then talk about your retirement. I wish the bar was higher. Now, I see the proliferation of CPAs now getting into the business because with 10,000 baby boomers hitting age 65 every single day, they want to get in front of that demographic tidal wave. I've got some advice for you, Mr. or Mrs. CPA, why don't you get in front of that demographic tidal wave with the services that you offer, meaning tax services, why not that?

Be careful out there. It's like everywhere you go, someone's going to try to sell you an annuity. If you go to the bank, all of a sudden the banker sells annuities. If you now go to a CPA, all of a sudden, your CPA sells annuities. If you go anywhere, someone's going to try to sell you an annuity. It wouldn't surprise me if a realtor tried to sell you an annuity. Why is that? Why is it always an Indexed Annuity? Again, nothing against them. Why is that always the case? Yeah, you're right. Commissions, commissions, revenue, they're not thinking about you. Remember, in a fiduciary world, where advisors should always act like a fiduciary, meaning putting your best interests ahead of theirs. In a fiduciary world, they are not acting like a fiduciary. CPAs, stay in your lane. I'll stay in my lane and everything will be good.

Never forget to live in reality, not the dream, with annuities and contractual guarantees! You can use our calculators, get all six of my books for free, and most importantly book a call with me so we can discuss what works best for your specific situation.


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