Loyalty and Money

Loyalty_1d2112_2002497Five years ago, my first car was starting to crap out and I started looking around for a new one. As much as I H.A.T.E the whole car-buying process, it was a little exciting to look at the possibilities now that I had a pretty solid job working full-time during school. As soon as I started telling friends I was looking for one, one of them told me to come by his dealership and he’d give me a sweet deal. Awesome! I thought.

But as soon as I got there, he switched from friend mode to douchey salesman mode faster than a short fat kid speeding down the hall for school lunch (ahem, that was me…). His first question was, “What’s the most you willing to spend on a car?” Pretty harmless question to the naive, right? Except you should NEVER answer it truthfully, because your price ceiling becomes their price floor. I showed him a print-out of a car I was looking at buying from a private seller and wanted to see if he had a better deal than that.

He started showing me cars that were thousands of dollars out of the price range I gave him. When I asked him to show me something closer to what I was looking for price wise, he showed me a little POS Chevrolet Aveo that smelled like the inside of Sigmund Freud’s smoke pipe and a Hyundai Elantra that looked like a Bengal tiger used the interior as a scratching pad then barfed all over the back seat before trading it in to the dealership for a trip back home to India.

Needless to say, I was far from impressed, and I told him so. His answer was that even though the other ones were more expensive, he’d be able to get me a better rate on them. Because anyone would rather buy a $20,000 car at 2.99% than a $10,000 car at 3.99%, right? His main purpose for the hour I was there was for me to fill out and sign a credit application so he could run off to his manager (who, like the great and powerful Oz, was completely unapproachable) and try to hook me into a deal.

I left as soon as I could with the firm decision that I wouldn’t buy a car off him even if he came around to trying to give me a deal. Why? Because I knew where his loyalty was, and it wasn’t with his friend.

My dad and I went to another dealership later that day. There was a guy there who lived in my neighborhood growing up. He asked me what I was looking for, I showed him the print-out, he asked his manager if they could beat it, the guy said no, and he told me to buy it before someone else did. I was speechless. Here I was ready for another fight and it was over in just a few minutes. The guy didn’t want to just sell me a car. He wanted to help me find the best car that fit my needs. And it turns out that they didn’t sell it, and he was cool with that.

Selling Insurance

Fast forward a few years and I’m selling life insurance. Based on prior experiences and my overall hatred for scumbag salesmen, I decided to take a different approach. I told my prospective clients how I got paid from their premiums. I educated them about insurance gave them my recommendations, but taught them enough for them to make their own educated decision. And most importantly, I told them that it was more important to me that they are taken care of than for me to earn the money. I made sure to include urgency in the equation when they were in a situation where it was warranted, and there were times when I was firm in my recommendation, but even then I left nothing concealed about how important it was that they make the decision themselves.

I got a lot of clients based on that approach. My premiums weren’t high because they kept going for the low ball amounts, but I felt like they trusted me, which could possibly make them clients for life. One client, though, disappointed me.

After about a year and a half, Kilee and I decided to move closer to her parents, and it didn’t feel right to keep doing financial planning in the new area, so I started calling all of my clients to let them know what was happening and that I was handpicking their new advisor to make sure they were taken care of. One of them surprised me by asking me to cancel all of their policies on my last day. When I asked him why, he said that the only reason they were doing it was to help me out.

To be completely honest, I was furious. Not because that cancellation would reverse my commissions, but because somehow he got the idea that I was recommending he get insurance for his little family for my own benefit. And yes, I did get paid. But the last thing I wanted was to be viewed as just another salesman.

Business Opportunities

Another story comes from a friend of mine whose old friend from high school called him up one day and asked if he and his wife wanted to go out to dinner sometime to catch up. He hadn’t seen him in years, so he was excited to meet his wife. They set up a time for the end of the week, but the guy called back the night before and told him that a friend of his would be joining them and asked if my friend would mind if he gave them a little presentation.

The phone call ended pretty quickly after that and the dinner never happened. So much for “catching up”.

Loyalty and Money

When I recommend something to someone, whether it’s when I was an insurance salesman, or even now when I recommend different products with affiliate links, I always try to make sure my loyalty lies with the people I’m recommending it to. I would never want someone to spend their hard-earned money just to “help me out”. That’s not how it should work. You work hard for your money, so I should work hard for mine too.

I ran across people like that all the time when selling insurance. I could usually find a policy that saved them quite a bit of money each month, but they wanted to stick with the guy they had either because he was a friend or “he’s always been good to us.” But here’s something to consider:

You’re loyal to your friend/family member, but are they being loyal to you? Are they giving you the best deal? Are they explaining things well enough that you can make an educated decision for yourself? Or they just expecting you to trust them? I can’t tell you how many times I came across someone who was being completely ripped off by their friends or a “trusted” advisor who’s been helping their family for years. I can’t stress how important it is that you educate yourself about what you’re doing with your money. If it’s a true friend, your friendship won’t suffer one bit by you saying no. Because in the end, their loyalty will lie with you and not your money.

It’s also important to recognize that there are friends out there who do care about you, they just don’t really know what they’re doing. That’s happened to me more than once. Don’t let it ruin your friendship. Just be real and if they’re really not trying to take advantage of your friendship, they’ll make it known. The opposite is also true, so don’t beat around the bush or it will get awkward pretty fast. Loyalty and money can be a tricky thing, but be up front and act like an adult about it and you’ll be alright.

Have you ever gotten ripped off by someone you thought had your best interest in mind? Do you think it’s important to show loyalty to someone with your money, even if they aren’t returning the favor?

(photo cred)


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