Financial advisors are supposed to help retirees protect and grow their money. But not every strategy they recommend is truly in your best interest. Hidden fees, outdated advice, and subtle sales tactics can quietly drain your savings. Seniors, in particular, are vulnerable because they often trust professionals without questioning the fine print. Here are nine financial advisor tactics that may be costing retirees thousands of dollars in 2025.
1. Pushing High-Commission Products
One of the most common financial advisor tactics is steering seniors toward products that pay the advisor a hefty commission. These often include annuities, insurance policies, or proprietary funds. Commissions can reduce your returns and lock you into inflexible contracts. Advisors may emphasize “guaranteed income” while glossing over high fees. The sales pitch benefits them more than you.
2. Overloading Portfolios with Annuities
Annuities can make sense for some retirees, but many advisors overuse them because of the payouts they earn. Annuities are often complex, expensive, and not the best fit for every situation. Some tie up your money for years with steep surrender charges if you want out. Seniors can lose flexibility at the very stage of life when they need liquidity most. Over-concentration in annuities is a red flag.
3. Charging Hidden Fees
Another costly tactic involves burying management fees, account charges, and transaction costs deep in paperwork. Even seemingly small fees can add up to thousands over a decade. Lower-cost investments consistently outperform those with high fees. Unfortunately, many retirees don’t realize how much they’re paying until it’s too late. Transparency should always be a top demand from your advisor.
4. Encouraging Frequent Trading
Some advisors push clients to trade frequently, generating commissions with every transaction. While this may sound like “active management,” it often just means more costs and taxes for you. “Churning” accounts erodes retirement savings without delivering extra returns. Seniors may not notice the slow bleed from these repeated trades. If your advisor trades often but can’t explain why, be wary.
5. Overselling “Guaranteed” Returns
Many seniors are attracted to products labeled “safe” or “guaranteed.” Advisors may use this language to sell investments like structured notes or indexed annuities. These guarantees often come with restrictions, fees, or capped earnings. The promise of safety can mask serious limitations. Seniors should ask tough questions before accepting these claims at face value.
6. Steering Clients into Proprietary Funds
Some firms push their own branded mutual funds or investment products, whether or not they’re the best option. These proprietary funds often have higher expense ratios than comparable alternatives. Conflicts of interest are common in advisory firms. While marketed as “exclusive,” these funds can quietly drain more money from your retirement. Always compare costs before agreeing.
7. Ignoring Tax-Efficient Strategies
A lack of tax planning is another way seniors lose money. Advisors who focus only on investments and not on tax consequences may cost clients thousands in unnecessary IRS bills. Investopedia explains that strategies like Roth conversions, tax-loss harvesting, and proper withdrawal order can stretch retirement savings much further. If your advisor isn’t addressing taxes, you’re missing out on real savings.
8. Recommending Overly Conservative Portfolios
Some financial advisor tactics play to seniors’ fear of risk by keeping them too conservative. While safety matters, investing too heavily in cash and bonds can’t keep up with inflation. Overly cautious portfolios may leave retirees outliving their money. Advisors should balance protection with growth, not simply park assets where they stagnate. Being “too safe” can be just as dangerous as being reckless.
9. Downplaying DIY and Low-Cost Alternatives
Finally, some advisors downplay the rise of robo-advisors and index funds because these tools threaten their fees. But NerdWallet points out that robo-advisors and self-directed options can deliver similar results at a fraction of the cost. Seniors who stick with traditional advisors without questioning may be paying more than necessary. Advisors who dismiss these tools without explanation may not have your best interest in mind.
What Seniors Should Do Instead
Not all advisors are bad—but being passive could cost you dearly. The wrong financial advisor tactics can drain thousands of dollars that should be funding your retirement, not lining someone else’s pockets. Always ask about fees, commissions, and alternatives before saying yes. Independent second opinions and fiduciary-only advisors can help ensure you’re not being misled. In retirement, protecting your wealth is just as important as building it.
Have you ever encountered financial advisor tactics that cost you money? What strategies do you use to keep your retirement safe? Share your experience in the comments.
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Teri Monroe started her career in communications working for local government and nonprofits. Today, she is a freelance finance and lifestyle writer and small business owner. In her spare time, she loves golfing with her husband, taking her dog Milo on long walks, and playing pickleball with friends.
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