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TRUMP UNIVERSITY WEALTH BUILDING 101

Financial Planners Aren’t Always What
They’re Cracked Up to Be

For many years, I was a financial planner who worked on commission sales.

In every sales office where I worked, there was a board listing the name of
each salesperson, along with his or her sales and earnings for the month.
Why I am telling you this? To impress on you what I learned by studying
those boards: In commission sales, 5 percent of the salesforce is outstanding,
15 percent are very good (the top 20 percent earn 80 percent of all commis-
sions), and 80 percent aren’t good at all at sales (the 80 percent only make
20 percent of the commissions).
For several years, I worked in the top-producing office for the tenth

largest financial planning company in the United States. There were almost
100 agents in the office, but less than five truly knew what they were doing.

Another 10 or so were very good, but they worked on estate planning or busi-
ness primarily, with only the wealthiest clients. Like myself, these top agents
did not meet with the average person. Few of the other 80 or so agents lasted
more than two to three years in the business. Most struggled to pay their own
bills, and few offered advice that made their clients money (other than the
luck of the market).
Agents were trained to focus on selling life insurance, then mutual funds.
Why? Because the license to sell life insurance is the easiest one to get, and
selling life insurance pays the highest commission, from 80 percent to 85 per-

cent of the first year’s premium. If your name was not at the top of the list on
the sales board, and you were not selling life insurance, you could count
on being called into the manager’s office and read the riot act.

From my experience, I can tell you that the top 5 percent are truly out-
standing. They invest themselves, are personally wealthy, and represent many
high-end clients, but high-end planners work only for the wealthy. The next
15 percent of planners are great. They make solid decisions, provide above-
average rates of return and do well for themselves and their clients. The
remaining 80 percent—8 out of every 10 planners—aren’t much more than a
nice salesperson in a good-looking suit.
The unfortunate truth is that commission-based advisors can’t always be
counted on to give you advice that is in your best interest. They have too much
incentive to sell you the investment products—life insurance, annuities, and
mutual funds—that will earn them the highest commissions. If you aren’t wealthy
already, don’t be naïve and think any planner is going to make you rich. Inform
yourself. Understand the commission game. Before you ever buy an investment,

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