Provide an unbiased/accurate source of information about Primerica. That was the mandate I tried to accomplish while writing my Primerica series. When I receive questions such as the following ones, I think I got pretty close. So here’s the email I receive about the business opportunity offered by Primerica:

I have not yet joined Primerica because I haven’t been able to find enough unbiased information regarding the opportunity and others similar. I am hoping you can help me a little bit…

Here are the reasons I was attracted to Primerica:

I currently have a full time career that I would like to continue at least UNTIL my income that I currently generate is COMPLETELY or close to being replaced by something else. I like the fact that you DO NOT have to do Primerica full.

I also like that Primerica does not require large capital to start (ex. buying a franchise) etc.

I like some of the products that they offer (Ex: S.M.A.R.T. Loans)

I do believe in the concept of Buying Term and Investing the difference.

I like that you do not have to open a store front and I thinking meeting clients in their home is more suiting and gives them a higher comfort level.

Here are my main concerns and questions unanswered yet:

Whether Primerica has ENOUGH products to effectively offer a complete financial plan for families.

Whether their rates are reasonable or if they have substantial benefit to be higher.

Whether you can operate a reasonable business ACTUALLY selling and writing financial plans without recruiting. I don’t mind helping others get licensed in insurance, mortgage, or securities if they want to but I don’t care for it to be to benefit me. I prefer to have my OWN success determined by me.

And MOSTLY,
Are there any other companies that you would suggest that allow me to do what I want on a part time basis like I mentioned?

As you can see, Chris (fictional name ;-)) resumed most of Primerica attracting points such as:

- Being your own boss.

- The option of working part time and not leaving your current job.

- The company culture of offering the best product for the client (don’t misunderstand me, I am not saying that Primerica is offering or not offering the best products, but they truly believe in helping the client in their company culture).

- Low start up cost.

I actually agree with most of his points. However, before I start answer his questions, I must say that in this kind of business (personal financial services, insurance, investment), it is really hard to succeed if you don’t work full time. While you have the option of making a lot of money, you need to put a lot of work into it as well.

In regards to product competitiveness (in term of pricing and global offer) I would say that even though Primerica was one of the first (or maybe the first) to offer term insurance, all insurance companies are now offering similar product. Therefore, I don’t think their product structure will give you an advantage neither become a flaw to your business. The main reason is that financial institutions are so strong that they can develop any good products offered by a competitor within months.

I actually don’t believe in pricing as a marketing tool anyway. I rarely negotiate with my clients. Why? If you are selling based on price, you will always have to be the lowest in town for everything, which is impossible if you want to still make money. Make your clients believe in you and in your added value (it can be responsiveness, competency, planning quality, etc.).

However, Primerica’s reputation might affect (for good or bad) your business. Let just say that it is a highly controversial company

Can you work for Primerica and not recruit people? Sure, but if you do not recruit other Primerica agent, you are missing the main strength of Primerica business model: Multi Level Marketing (MLM). Your commission level is lower than other company in the industry in order to provide you the opportunity to recruit other Primerica agent. If you don’t want to, you are better of with another company.

Do I know any company where you can work part time in this kind of industry? I would answer that most investment and insurance companies where you act as a self-employed agent should let you do it. However, I did not have yet verified with other companies.

I would like to have your input for the benefice of Chris and everybody that is wondering if whether or not they should join Primerica Multi Level Marketing Business Model.

If you liked this article, you might want to sign up for my FULL RSS FEED. Then, you would get my daily post in your email and can read it at any time. To subscribe, please click HERE.

If you liked this articles, you might wan to sign for my FULL RSS FEEDS. Then, you will get my daily post to your email and can read it at any time. To subscribe CLICK HERE

Related Post

• Comparing Primerica To Other Companies
• The Primerica Paradox: The Discussion
• The Primerica Paradox: The Conclusion Part 2
• What About Mutual Funds at Primerica?
• Primerica For Sale? Not Any More!

To be honest, I am not really interested in their term life insurance product as they are similar to any other insurance company. They might have been one of the very first companies to sell term insurance back in the day but these days are over. Every insurance agent I have met in my life (working for several different companies) told me the same thing: we are there for our client and we will offer them the insurance product to cover their needs. So, guided with the light of one of the numerous commentators on my Primerica analysis, I decided to look into their mutual funds.

Therefore, my post is more focused on the Primerica Concert series offering diversified portfolios according to your investment profile.

According to Morning Star, they rate the aggressive growth, the growth and the moderate growth with a 5 stars score. The three of them offer double digit returns over 5 years (and over 3 years for the aggressive and growth portfolio). However, those funds are not for soft hearted as they all show negative double digit returns at one point in time as well. So if you like trashing with your investment as you were at a Marilyn Manson concert, you might enjoy the ride J Nonetheless, they are qualified in the 1^st quartile most of the time and their Morning Star rate is quite good.

The Primerica Concert series seems to be an all-inclusive option for investors. These portfolios offer a great asset allocation between fixed income, cash, Canadian equities, American equities and International equities. On the other side, they are a bit too much concentrated in Canadian stocks to be considered a fully diversified fund. For example, the aggressive portfolio has a concentration of 46% in the Canadian market. So this diversification will help smoother the volatility but is not optimal.

Another thing caught my attention when I was digging further; the performance over 10 years. When I attempted to a Primerica meeting, they were mentioning double digit returns to make the financial projection. I guess they were referring to their Concert series. However, their 10 years performances are showing returns of 6% for the three categories of funds. So would you really like ending some years at -20% knowing that you will end-up with a small 6% overall returns? I have to mention that their MER’s of 2.5% are pretty high and certainly don’t help to show some good long term results!

In the end, I think that the Concert Series are still good mutual fund. They obviously outperform their category with a high percentage in Canadian equity. On the other side, their long term stats and MER’s don’t make me a huge fan of them either.

If you liked this article, you might want to sign up for my FULL RSS FEED. Then, you would get my daily post in your email and can read it at any time. To subscribe, please click HERE.

If you liked this articles, you might wan to sign for my FULL RSS FEEDS. Then, you will get my daily post to your email and can read it at any time. To subscribe CLICK HERE

Related Post

• Answering to a Reader’s Comment on Mutual Funds
• The Real Benefit From Mutual Funds
• A Reader’s Question about Primerica Multi Level Marketing Business Model
• A Response From a Primerica Agent Part 1
• A Response From a Primerica Agent Part 2

After reading Michael’s comment on my first post on Primerica, I realized that I should bring another point regarding personal finance companies. While I still do not think that Primerica is being honest with its marketing, it does not mean that all their financial advisors are crooked. On the other side, financial advisors working for other companies may not be as good as you think they are. I have been working with hundred of consultants working for a dozen different companies and I established three categories of financial advisors.
Clowns Yup, you read it right. The financial industry is full of clowns! Clowns are individuals who has no financial background and do not understand products they are selling. Since they do not know what they are doing, you better be careful giving them money to manage. You are asking me how come there are so many of them? Simply because anyone can become a financial advisor within three months!	-
he best way to recognize them is to read about a specific topic in finance and then asking them question about it. If they what they are saying does not make sense whatsoever, you have a clown in front of you.
-	Car Salesman I feel sorry for the (four) honest car salesmen on earth but they did not get a bad reputation for nothing ;-). Seriously, the financial industry is also full of salesmen that are looking to make the biggest commission out of their meeting. They are nice, polite and full of confidence. Therefore, you will feel satisfied dealing with them and you will be under the impression that they are doing the best thing for your (theirs) finance.
Some salesmen are still good financial advisors since they can have a team that are building the financial plan behind them. They most likely are the best performers of their region. If you feel that you are dealing with a salesman, make sure to meet his assistant, associate and other member of his team. Never forget that he is in to make money, if he has a bad team to support him, you will end-up with a bad financial plan.
Financial Planners Yes, there are some good financial advisors out there ;-). While the title “Certified Financial Planner” (CFP) is not a guarantee of results, this is the only category of financial advisors that had to write exams that goes deeper than the stupid mutual funds or insurance licence. However, when I am talking about financial planner, I am not really talking about the title but more about the way they handle things.	-
A financial planner will look at all the aspect of your personal finance (estate, insurance, investment, taxes, debts, etc.). He will help you out building a plan according to your needs and your goals. He will also provide useful advice and knows what is going on in the financial industry. This is a financial planner.
I must say that overall, there are a lot of clowns, some bad salesmen and a few good of them and very little financial planners. In my province, the government and the Personal Financial Planner association are working together to create an official standing for Personal Financial Planners. They want them to be recognized at the same level as the notaries, lawyers and other professions. Hopefully, many other governments will go this way in order to insure a minimum of professionalism to the population.
If you liked this article, you might want to sign up for my FULL RSS FEED. Then, you would get my daily post in your email and can read it at any time. To subscribe, please click HERE.

If you liked this articles, you might wan to sign for my FULL RSS FEEDS. Then, you will get my daily post to your email and can read it at any time. To subscribe CLICK HERE

Related Post

• How To Find A Good Financial Advisor Part 2
• How to start investing - A DIY Growth Investment Strategy Part 7 – What Does A Financial Planner? (Besides having diplomas and telling you to stay invested)
• How to Find a Good Financial Advisor Part 3
• The Primerica Paradox: The Conclusion Part 2
• The Primerica Paradox: The Discussion

I have responded once before and wanted to take this opportunity to share some history about the Primerica phenomenon.

When Primerica first emerged, it was under a different name….it was called A.L. Williams. Art Williams, a high school coach, began selling TERM Insurance and MUTUAL FUNDS.

His logic was simple:

(1) Whole Life Insurance is simply a bundled product, composed of a decreasing term policy linked to a savings component I will refer to Whole Life and its cousins now as CASH VALUE POLICIES

(2) Cash Value Policies, on a cost per thousand, are much more expensive than Term Inisurance

(3) Cash Value Policies are difficult to understand and most traditional life insurance agents cannot tell you how much of your premium dollars go the the life insurance component and how much goes to the savings component. Remember, MOST Life Insurance agents were NOT college educated in finance and economics. What they learned about insurance they learned from the Insurance Company that hired them

(4) The rate of return on the savings component is extremely low. According to a Federal Trade Commission study conducted in the 1970s, the rate of return was less than 2 percent!

(5) In most cases, when a person who owns Whole Life dies, his beneficiaries receive only the face amount of the policy, NOT the savings!!

(6) If you take out the savings while the policy is in force, you either have to borrow the money (that’s cute…you borrow your own money) or if you take out all the savings, the insurance company reserves the right to cancel your policy. You don’t have to believe me, just READ the policy and examine its provisions.

(7) His conclusion?

Have people purchase TERM insurance so that they could afford adequate coverage

Have people invest in mutual funds to satisfy their retirement needs because historically they have provided a much higher return than insurance policies.

As another advantage, IF the policy owner dies, his family receive his insurance AND investments.

He called this concept “Buy Term and Invest the Difference!” The concept had actually been around for a long time. Art Williams simply adopted it and put it into practice.

How did the life insurance industry react? Attack after attack after attack. The little dirty secret was out. Primerica revealed that the industry was focused on selling its most expensive product (Whole Life) to make profits rather than to provide benefits to its policy owners. Sure, they could sell term, but they instead pushed whole life policies as “investments.” But Primerica kept forging ahead. As more and more people became financially literate, they began to question the practices of the once revered insurance companies. The people began to act.

In the 1990s several of the industry’s top companies were facing class action suits for parading Life Insurance as an investment. Prudential, MetLife, and many others were stung and forced to pay liabilities to customers.

The industry never forgot Primerica and continued to attack her with a vengeance. The company was excoriated and its representatives impugned. Rumor and innuendo about Primerica was rampant. The way we were protrayed you would have thought that behind each of our names were the numbers, 666!

As Primerica grew, so did the logic and wisdom of its message. But Term Insurance and invest in mutual funds! Now most financial planners worth their salt parrot the same mantra, as do respected magazines such as Consumer Reports, Forbes, Money, and many others. The revolution Primerica launched continues to evolve today. And that is good for the average Joe out there.

Having witnessed attacks against Primerica for fifteen years, I realize there will always be detractors out there and that we will never reach them. I do wonder, however, why you don’t see the same against the so-called traditional insurance companies. It leads me to believe that most of the posts and complaints I have read over the last decade and a half come not from John Q. Citizen, but traditional life insurance agents and their proxies.
Much of the rest come from people who embrace every conspiracy they hear and simply repeat what they read….

Primerica is a MLM company
Primerica is a pyramid scheme
The representative who work for Primerica are evil and ignorant, they don’t know what they are selling
The representatives are not “professional”
Primerica is about to go bankrupt

Goodness, the list goes on for infinity. Despite all this tired diatribe, Primerica continues to be the largest and most successful marketing company on earth.

Let me pose a question to you as an average Joe. The large insurance companies can sell Term just like us. Why do you suppose they opt to sell you their most expensive product (Whole Life)? You got it. To make more money.

Now the follow up question. If the agent sold you his most expensive product, did he do it to benefit your family, or his?

Your ponder those questions and think with logic rather than emotion. As for the life insurance agents, I really don’t care about your opinions. I have sat across the table with whole life agents with clients to debate which type of insurance is best for the client. Wanna guess who won?

I am not an arrogant snob. I am open to different perspectives and understand that NO company is perfect. By the way, NO client is perfect either.

But, I have met a lot of arrogant life insurance agents working for the major firms who spend more time on the golf course while their underpaid secretaries do the work than they do in front of families.

We at Primerica make a heck of a lot less on an insurance commission than the traditional whole life guy. But we are eager to help people and will visit them multiple times to satisfy them and provide the most professional advice we can offer. We don’t have secretaries, we don’t demand you come to our office, we don’t wear costumes (starched shirts and $80.00 ties) to impress you with how we dress.

What we do is offer you, free of charge, the most important thing a person has, and that is his time. AS for our expertise, we have the same credentials that the other guys have, and probably a lot more.

Those of us who have been around for awhile are seasoned, well trained and extremely motivated. We truly enjoy seeing people improve their lives and stick to the old creed, “Give people what they want and you will get what you want.”

Thank you for your time,

Mike

If you liked this article, you might want to sign up for my FULL RSS FEED. Then, you would get my daily post in your email and can read it at any time. To subscribe, please click HERE.

If you liked this articles, you might wan to sign for my FULL RSS FEEDS. Then, you will get my daily post to your email and can read it at any time. To subscribe CLICK HERE

Related Post

• A Response From a Primerica Agent Part 1
• A Reader’s Question about Primerica Multi Level Marketing Business Model
• Comparing Primerica To Other Companies
• What About Mutual Funds at Primerica?
• The Primerica Paradox: The Discussion