Primerica Mutual Funds....Good/Bad Idea?

[hsd1]

I am considering putting money in with the Primerica's mutual funds. As i am browsing over the internet some people have great thigns to say, others have bad things (mostly about the employees). Have any one of you gone into mutual funds with Primerica and if so, how was your return? Is it a good idea to invest with this company?


And if not...i have capital to play around with, where do yousuggest i go?

[Primer]

Primerica sells all the same mutual funds that you can buy pretty much anywhere.

The advantage Primerica offers is that you have a personal agent for service and a comprehensive Financial Needs Analysis that is complimentary for all customers.

[Blunt]

The advantage Primerica offers is that you have a personal agent for service and a comprehensive Financial Needs Analysis that is complimentary for all customers.

I would just question how qualified this agent is, since all that is required is $200 to get the job.
I personally don't believe in complimentary services. How good of a job do you think a person would do without getting paid?

[DanielCarrera]

I am considering putting money in with the Primerica's mutual funds.

Can you provide a link to the specific mutual funds that you are thinking about? I couldn't find anything on their website. What is their MER? What do they invest in? Could you accomplish the same thing using low cost index funds?

how was your return?

This information should be available from their website. The mutual fund's prospectus should say this. Don't just rely on some stranger on the internet saying "the return was good/bad". Also note that past performance does not indicate future performance. Don't just extrapolate the past.

And if not...i have capital to play around with, where do yousuggest i go?

A good coince is index funds from TD Bank or Altamira. Both have low MERs. CIBC has a wider selection of index funds, in case you are looking for something very specific, but their MER is higher, so I think TD and Altamira are better.

Try to figure out what your proper risk tolerance is. You could buy a copy of Random Walk down Wall Street by Malkiel. Then you would be making a more informed decision.

[DanielCarrera]

Primerica sells all the same mutual funds that you can buy pretty much anywhere.

I couldn't find anything on their website. Do you have a link?

[iluvmikeharris]

Scam/cult/ripoff. Stay away.

[hsd1]

Daniel thank you for your information, I will get back to you on the specific funds in a couple days. Much appreciated.

[Primer]

I would just question how qualified this agent is, since all that is required is $200 to get the job.

That's not actually true. There's education and industry standard examinations that need to be passed. Also there are the normal background and criminal checks required to be licensed.

I personally don't believe in complimentary services. How good of a job do you think a person would do without getting paid?
That's a misunderstanding. The Analysis is complimentary, but typically agents are paid commissions for selling products recommended in the Analysis.

You can buy the same funds somewhere else, but you wouldn't get an Analysis and you'll still be paying commissions.

[don242]

I couldn't find anything on their website. Do you have a link?

Primerica sells the same funds as most everyone else. You can get Altimira, AGF, Trimark, etc. through Primerica. Just like many financial companies, they sell the funds. The MER is the MER for the specific fund, so if you buy a Trimark fund, look it up on the Trimark site to find the MER.

[hsd1]

The rep i am working with has stated that they are just here to salesmen and that my money is being worked with the professionals at the actual building who handle everyone else's money, he looks very trustworthy and honest as i have had multiple meetings with him. So as of right now, all the rep. stories i have heard, i feel would not apply to me right now. But has anyone invested with Premerica here?

[don242]

The rep i am working with has stated that they are just here to salesmen and that my money is being worked with the professionals at the actual building who handle everyone else's money, he looks very trustworthy and honest as i have had multiple meetings with him. So as of right now, all the rep. stories i have heard, i feel would not apply to me right now. But has anyone invested with Premerica here?

I have invetsed in a number of mutual funds that were done through Primerica. As I said, Primerica does not manage the funds. They are just the sales for the fund companies as your rep mentioned. When you purchase a mutual fund, you are investing in the fund with the actual fund company. Primerica just acts as the the agent to buy through.

The concern people have with Primerica is that they feel that anyone can become a sales rep and therefore you can get bad advice. While it is true, the same is also true for many other companies and their reps, including banks. If you have a good rep, I wouldn't worry about dealing with them.

The other concern with Primerica that people are opposed to is that they will ask you if you are interested in becoming a sales rep or ask you for referrals. Some people don't feel it is good business practice to ask for referrals. If you received a good service then why not refer others who may be interested. If you aren't happy with the service, then of course you won't recommend them. Much like any business. Primerica is just more direct in their approach.

[MP3_SKY]

Mutual Funds, yeah...
Primerica, No, heard som much bad stories about them. I would go with a better financial institution.

[Wall Man]

You can use Globefund to do a search.

http://globefunddb.theglobeandmail.com/gishome/plsql/gis.gen_fr?in_rep_type=LT&in_sort_col=STD_fund+name&in_orig_start=+&in_curr_val=+&in_orig_fund=+&in_curr_fund=+&in_direction=FWD&fr_param1=Primerica+(PFSL)+Invest+Can+Ltd.&fr_param2=+&fr_param3=+&fr_param4=+&fr_param5=+&fr_param6=+&fr_param7=+&fr_param8=+&fr_param9=+&fr_param10=+&fr_mode=COMPANY&msg=+&page_no=1&generation=+&orig_col=REP_TYPE&orig_order=ASC&result_cnt=12&fr_param11=&fr_param12=&fr_param13=&fr_param14=&pi_universe=PUBLIC_FUND&product_id=&pi_totass_value=All&pi_mininv_value=All&pi_currency=All&pi_mgr_company=

Note that the Asset Builders are Segregated funds managed by AGF.

The other funds asset allocation is determined by Legg Mason and the underlying funds are AGF.

Just click on the respective fund and you can see a quick comparison to the group average and the respective index.

[hsd1]

thanks for the info people.

bumpppp

[hsd1]

my agent that i am dealing with has also stated that i should expect a 12% average interest over the course of my investment if i stay in it for 10 years.
Has anyone else heard this from any primerica agents?

[don242]

my agent that i am dealing with has also stated that i should expect a 12% average interest over the course of my investment if i stay in it for 10 years.
Has anyone else heard this from any primerica agents?

This seems to be the number that most Primerica agents use. 12% is based upon historical data and not necessarly what is to be expected. From 1970-2001, 12% was the average. For the past 5 years though, this number is on average less (though still very possible with the right funds). I am not so sure I would expect those returns for the next 5 years either, though it is always hard to see into the future. Right now there is so much flucuation that my annualized returns vary so much. It is hard to say what the markets will do over the next 10 years. Using historical data helps but only to a point. There are so many factors that affect things now that were not present in historical market data. I have seen graphs that show another 10-15 years where the annualized expectations are less than 5% and I have seen graphs that seem to indicate that markets are going to soar. I have seen graphs say this a bull market, I have seen graphs show a long bear market.

I tend to use a little more conservative numbers in my calculations (8-10%) but hope to get 12%+. If you are relying on the financial assessment from primerica, ask them to use a little more conservative numbers otherwise use the assessment as a guide to make your own plan.

[hsd1]

Thanks don242, I will ask them to use numbers in the 7-10% region next meeting.

And has anyone heard of Primerica having any hidden fee's or anything of the sort within their investment opportunities?

[charliebrown]

Thanks don242, I will ask them to use numbers in the 7-10% region next meeting.

And has anyone heard of Primerica having any hidden fee's or anything of the sort within their investment opportunities?

perhaps not hidden fees, but you may find out you dont have adequate life insurance, critical illness, etc coverage ;)

[don242]

perhaps not hidden fees, but you may find out you dont have adequate life insurance, critical illness, etc coverage ;)

You need to figure out your own life insurance needs based on your situation. The assessment provides a life insurance amount based on the information you provide. If you provide unrealistic information then you will get an unrealistic output. I went through one of Primerica's finacial needs assessments once out of curiousity. I was expecting it to tell me I need large amounts of insurance, etc. and I was critical of every question it asked. I was surprised when it said our insurance needs were sufficient and it actually used the data I inputted in a realistic way. It is as the saying goes "Garbage in, garbage out" so if you are going to use their assessment, think about the questions carefully. And then when you get the results use it as a guide only. I doubt it can account for every situation perfectly. There were a few odd suggestions that the assessment recommended in different areas but common sense dictated a different approach.

Just for the record, Primerica said my insurance needs were adequate. A few months before that I was at a bank about the mortgage, they went on and on about how we were under insured and that we should purchase additional insurance from them. They all do it, try to push their products on you even if you don't need it. I don't think it is limited to Primerica, even the banks do the same thing.

Bottom line is use the advice and reccomendations as a tool but always make your own decision.

[DanielCarrera]

my agent that i am dealing with has also stated that i should expect a 12% average interest over the course of my investment if i stay in it for 10 years.
Has anyone else heard this from any primerica agents?

12% unreasonable and over-optimistic.

If you calculate the return of the S&P 500 since 1961 you indeed get 11.89% (source (http://www.ndir.com/cgi-bin/downside_adv.cgi)). But this ignores several important things:

* The return that you actually see is not the arithmetic average, but the geometric average. That brings the historical return down to 10.5% (source (http://www.ndir.com/cgi-bin/downside_adv.cgi)).

* He ignores the very high inflation of the 70s. The average inflation since 1961 is about 4.25% (source (http://inflationdata.com/Inflation/Inflation_Rate/HistoricalInflation.aspx)). This makes the real (ie. after inflation) return equal to 6.25%

It would be more reasonable to suggest that you can expect to get 6% above inflation. Currently we live in a period where inflation is in the 2.5% region. So over the long term you should expect the stock market to return about 8.75%.

* He has not deducted the MER (management expense ratio) that mutual funds charge. A typical mutual fund charges 2%-2.5% MER. So the actual return you will see would be between 6.25% and 6.75% unless you go for index funds. And I doubt that the Primerica agent is suggesting index funds.

[FerrisB]

Primerica sells all the same mutual funds that you can buy pretty much anywhere.

The advantage Primerica offers is that you have a personal agent for service and a comprehensive Financial Needs Analysis that is complimentary for all customers.

:lol: That'll be the day when I have a financial advisor that shows up for appointments on the bus.

[Asun]

Primerica... definitely stay away.
Mutual funds.. stay away as well, unless it's really low MER. You'd be better off with ETF. How else do you think the Mutual fund pushers get their commission? ;)

[BBJAP]

Bad experience with the salespeople... not to say all are bad..

But they do have only limited training... i know because my mother in law works for them... no cpa, no cfa... no highschool needed.. only a few months of workbooks

Products... BEWARE of DSC... delayed service charge if you ever wanted to remove money within 7 years....

They are Segregated Funds... look them up over the internet and you'll see people's opinions about segregated funds...

You can do better

[DanielCarrera]

Mutual funds.. stay away as well, unless it's really low MER.

It's not as simple as that. With ETFs you have to pay brokerage commissions, so they are only better if you are depositing a larger sum. If you aren't, you should look into index funds.

[Primer]

This seems to be the number that most Primerica agents use. 12% is based upon historical data and not necessarly what is to be expected. From 1970-2001, 12% was the average. For the past 5 years though, this number is on average less (though still very possible with the right funds). I am not so sure I would expect those returns for the next 5 years either, though it is always hard to see into the future. Right now there is so much flucuation that my annualized returns vary so much. It is hard to say what the markets will do over the next 10 years. Using historical data helps but only to a point. There are so many factors that affect things now that were not present in historical market data. I have seen graphs that show another 10-15 years where the annualized expectations are less than 5% and I have seen graphs that seem to indicate that markets are going to soar. I have seen graphs say this a bull market, I have seen graphs show a long bear market.

I tend to use a little more conservative numbers in my calculations (8-10%) but hope to get 12%+. If you are relying on the financial assessment from primerica, ask them to use a little more conservative numbers otherwise use the assessment as a guide to make your own plan.

The training (and the strictly enforced software) says to use three return estimates that are equally spaced. So some use 6, 9, 12 and others use 8, 10, 12.

I think there's a guideline not to exceed 12, though I can't remember since that never really comes up.

Anyone working a Primerica agent can ask to use whatever values they prefer, as long as they conform with the rules of course. In other words, if you want to pick 8%, you and your representative can go right ahead and do so.

Remember, in the presentations being given, they are trying to illustrate the power of equity investing for the individual compared to the prevalent practice of people buying low return GIC's and such.

They also illustrate that 12% ROR is easily attained by financial institutions, and the suggestion is why give the difference to your bank when you can be the investor?

[frankal101]

Just like any other commission based service, the issue is conflict of interest of what is best for you vs what is best for the sales person. What the sales guy might sell you is an "expensive" product that generates high fees for him and leaves you disadvantaged in the long run (compared to other alternatives). Im not saying this is specific to Primerica, but is a common problem for the whole industry. What makes Primerica a particularly dangerous alternative is lack of experience of agents... Like someone said all you need is $200, a couple of months of reading, some minimum certification and a whole lot of contacts - then sell away! THat is not my idea of an investment professional who will implement a strategy to make sure the last 30 years of my life are not spent working or living on next to nothing. Look for planner with credible industry certifications, such as CPA or CFA - they are well trained and are held to a much higher standard (professionally that is - there is always bad apples)... Anyone can purchase a software to spit out a generic asset mix "blob" on the investment horizon - that is not what financial planning is all about... My suggestion is find a fee based credible financial adviser that will go through all of the necessary analysis and put you on the right track. sure it might cost you some money - but you wont have to revisit it for a long time and you will have the piece of mind that it was done right... thats my 2 cents...