Should I warn a friend about a potentially unscrupulous family member?
September 6, 2013 4:12 PM Subscribe
An old friend contacted me asking if I would be interested in financial advice from his sibling, who has recently started in the profession. I suspect that this sibling is a commission-based advisor earning money from a high-MER mutual fund provider through kickbacks. Should I confirm that and warn the friend, or let it be?
posted by ripley_ to human relations (10 answers total) 1 user marked this as a favorite
I declined the offer, but I worry that this friend might accept advice from his sibling or direct mutual friends to his sibling.
I don't want to offend my friend (or worse, cause a rift between us), but I also really don't want my friends' retirement savings to be eaten away by unscrupulous companies that prey on financial ignorance.
In case it's relevant:
1) I have professional experience which might carry some weight with my friend on financial matters.
2) I'm in Canada, where average expense ratios for actively-managed mutual funds really are that bad
. The average expense ratio of 2.2%/year is enough to cut my friends' savings in half over 30 years.
3) My friends are all reasonably smart people, but they know very little about the financial industry and basic financial calculations.