FREE NEWSLETTER

Dinner Is Served

Mike Zaccardi, 2:45 am ET

HOW LUCKY I WAS to be the recipient of a dinner invitation to Ruth’s Chris. I love a sizzling ribeye, so I booked my seat at the event. Those nearing and in retirement have a good idea of what I’m referring to—the good old annuity sales presentation.

These dinners are put on by financial advisors looking to expand their business. The routine goes like this: Invite prospects, present for an hour on the benefits of owning insurance or an annuity, and then let the guests enjoy their meal while attempting to book appointments.

It must work because these invitations are distributed all the time, though usually not to millennials like me. More often, it’s affluent couples in their 60s who get the flyers in the mail.

What I find interesting at these gatherings—I’ve been to a few—is the advisor’s sales tactics. I’m reminded of the strategies detailed in Influence, Robert Cialdini’s bestselling book:

  • Reciprocity. “The advisor is kind enough to buy me a $100 meal? The least I can do is hear him out and perhaps buy his product if it sounds helpful.”
  • Social proof. “I see couples making appointments. Oh, and table No. 1 has a few existing clients of his. They look like happy people. Maybe I should give him a chance.”
  • Commitment. “Well, I RSVP’d to this dinner and now I’ve hesitantly booked an appointment. I might as well follow through and trust this guy.”
  • Authority. “He has the credentials and his points make a lot of sense. And those were some scary stock market predictions. I sure don’t want to lose my retirement assets in the next crash.”

I never booked an appointment. I always leave these events worried for that innocent older couple who clearly don’t have a plan.

Such dinners underscore the value of true fiduciary financial advisors—some of whom even host such presentations with all the right intentions. Individual investors just need to be careful and remember to do their due diligence when choosing an advisor. Otherwise, that free steak could turn out to be mighty expensive.

Browse the Blog

Subscribe
Notify of
7 Comments
Inline Feedbacks
View all comments
Carl Book
Carl Book
2 months ago

I’ll admit it. I’ve attended several. I once heard the speaker assure the group that they would pay him no commission for purchasing an annuity. He explained that his commission was paid to him by the insurance company. I wanted to get up and say “so there is such a thing as a free dinner.” But I kept quiet and finished eating my steak.

Mike Zaccardi
Mike Zaccardi
2 months ago
Reply to  Carl Book

Same thing the guy said at mine! I wanted to say, “well, I buy the product from you and the company, the company pays you, so money is coming from me to you in a sense.”

mytimetotravel
mytimetotravel
2 months ago

I went to a couple some years back, partly because friends were going. None of us bit on anything but food. These days I’m tempted to go and ask awkward questions. Do you do that?

Mike Zaccardi
Mike Zaccardi
2 months ago
Reply to  mytimetotravel

I have to bite my tongue sometimes. I don’t want to cause drama.

Roboticus Aquarius
Roboticus Aquarius
2 months ago
Reply to  mytimetotravel

I’ve also been to a couple, more out of curiousity than anything. Since I’m eating their food, I have avoided causing a stir. That calculus would change if I felt they were trying to take egregious advantage of people’s ignorance.

Ormode
Ormode
2 months ago

It’s a very clever marketing plan. Only those who are naive enough to believe they are getting a free meal will come, and they are ripe for the plucking. It’s not just financial planners – estate lawyers run these things too. If you ever meet someone with $1 million in assets who has an estate plan worthy of Bill Gates, you’ll know they went to one of these seminars.

Jerry Pinkard
Jerry Pinkard
2 months ago

We never go to these “free” dinners because it may be the most expensive dinner we have ever had.

Free Newsletter

SHARE