This is an overly use phrase in the financial services arena; "(PRODUCT X) is a rip off". Many famous financial planners; Dave Ramsey, Suze Orman, etc just to name a few use this phrase. Typically, this phrase is used to scare people into submission while selling their product, books, seminars, DVDs, CDs, etc. This verbiage creates a"us versus them" dynamic. Them is usually the "evil" and "Greedy" Insurance Companies, Banks or Brokerage Firms. This verbiage is typical when creating a movement or cult like following. I understand the game, and it stinks quite honestly. When TV personalities use this verbiage, it is usually used to set up themselves as the expert. Financial Products are NOT created out of "Greed" of the companies. There is plenty of market research and regulatory red tape to satisfy BEFORE the product goes to market. These "experts" never seem to tell the complete story when verbally ripping up a particular product. I believe that we as professionals in this industry have the Fiduciary responsibility to tell people the ENTIRE story, not just scare tactics.
The financial products act as parts of the overall Financial Plan. If your objective is financial freedom, what difference does it make..just as long as the product performs as promised, right? There are various products that have pros and cons. For example, the strategy buy term invest the difference may be an excellent strategy for someone with limited or no liquid assets, while purchasing a Variable Universal life product may work also. It all depends on the objective of the client. My point is be flexible when hearing about different products in the marketplace. Just like cars, financial companies are always seeking improvements to existing offerings.
So in the future, when you hear phrases like" only buy term and invest the difference" or "Cash Value is the best", "don't buy reverse mortgages" or "Annuities are rip-offs" be smart enough to do research with a competent advisor who understands all sorts of products for your unique Financial Plan.