Louis (Luis) Barajas, a Latino Certified Financial Planner, recounts a conversation with a Spanish-speaking Uber driver he met after flying to a CFP Board meeting in Scottsdale/Phoenix. The driver — a 58-year-old woman who never worked outside the home — and her late husband had cashed out a SEP IRA around age 56 to buy their first home, let a costly permanent life policy (reported cost >$3,000/year, ~$200,000 death benefit) lapse, and then the husband died of COVID, leaving the family with little retirement savings and a 14-year-old child still at home. Barajas uses the anecdote to argue the financial planning industry is failing many Latino and other underserved communities, urges advisors to provide hands-on help (including pro bono work), offers to assist the woman remotely (help open an account at Fidelity, find term insurance, and start small savings), and invites others to contact him (louis@louisbarajas.com / info@louisbarajas.com) and to follow his Wealth Gap Warrior podcast work.
Questions this video answers
58 years old.
About 56 years old.
> $3,000 per year.
Approximately $200,000.
A 14-year-old son.
Chapters
Good morning, this is Luis Barajas. Welcome back. And hopefully you're following us and going to be attending some of our cinquent workshops in 2025. But I want to share a story with you that I think that God puts in my way every once in a while. I went to my Nashville CFP board meeting in Scottsdale, Arizona, landed in Phoenix and I took an Uber to the Phoenician where we were holding our meeting. And I hear that the lady had an accent. So I spoke to her in Spanish and I and right away we connected and she asked me what I was doing there and I told her that I was there at a national board meeting for the Certified Financial Planners Board and that I was one of the first Latino CFPs in the country and that I was there and that I love to work with people who needed help in underserved markets where maybe the profession isn't helping. And then she proceeded to tell me her story, which was.
Just kind of heart wrenching, but I think it's what's happening and what's true in the financial planning industry. So what did she tell me? She was 58 years old. She had never worked outside of her home a day of her life, had three kids, 58 years old, had an adult, had moved out, grown up and moved out. Another adult child who grown up and moved out and had a 14 year old son and told me that her husband of 58 years passed away a couple of years ago from COVID and unexpected. He was a very healthy man, contractor, had his own small business and what they did that he had saved some money in retirement and a couple years ago they were really happy but they pulled all their, their, their SEP IRA out of their plan to buy their very first home in Phoenix. So I mean at that time she was about 56 years old and they were owned a home before. So they, even though they used that money and, and they knew that it was a risk taking the retirement money out to buy the home, they felt that it was the best thing to do for them over the long term instead of renting an apartment in Phoenix. The other thing is that they had owned a life insurance policy that someone in Phoenix sold to them, but it was just too expensive. They were paying, she said, over $3,000 a year in that life insurance policy and they just couldn't afford it. And it was for it had a death benefit of about $200,000. And then right away, if anybody's listening to me and if you're a financial planning professional, you know that they sold them a cash value or permanent policy that should have never been sold to them and most likely they should have gotten a million dollar term insurance for one quarter of that price. So what happened is they let it lapse about a year after they got the house because of what they were making, the home payments and the property taxes and the insurance on the house. They couldn't afford to keep that life insurance policy. And what proceeded after that was she told me that her husband got Covid and you know, they didn't have the best health insurance and they delayed taking care of him and his, he got a lung infection and it became, it went from bad to worse and he died within three months unexpectedly. And she was devastated. So now no life insurance, no retirement plan, just bought a house at the age of 56 with a 14 year old still at home and never had really worked outside of, of the house. Typical kind of Mexican family. And so I see this all the time. This isn't just a one off, this is something that's very, very common. And I'm sitting there in the backseat of the, of her car, of the Uber, of her Toyota and realized that there is no one out there in the industry really that's serving this community. And our industry is failing. And if we are in the community, we're out there, somebody's pushing cash value permanent policies because they're going to make a lot more commission and they're worried more about themselves and they're worried about taking care of the client and maybe providing a term insurance policy and helping them save. And so she asked me that she needs to start all over again and wants to start investing. So I give her my number, give her my email. We're going to direct her to Fidelity directly, not through our firm. I'm going to show her how to open an account, we're going to walk her through and she's going to start saving like 25amonth and we're going to help her find terminal insurance out there. But this industry is failing. And so for, I think that at some point something bigger has to be done. People have to pay attention. But in the meantime, the industry only serves about 10% of the population. And there are a lot of Latinos out there who really want to help other Latinos. But again they're helping Latinos who have lots of money, who've made it, been saving tons of money. But there's a, there's a, a class of people out there who are hard working, good people who just want to take care of their families, want to take care of themselves, want to take care of their, even help their communities out. And they're the most giving people. So any advisors out there listening to me, any people in the financial planning industry, if you're doing something about it, reach out to me, please. Just go to louis@louisbarajas.com or info@lewisbarajas.com reach out to us. I'm also, you know, we, we've been slow on getting some of the Wealth Gap Warrior podcasts out, but we're going to be starting back up again. I've been doing a lot of traveling and been doing some really good work and we're Preparing again for 2025. But if you know someone who needs help, help them. You know, do it pro bono. Pro bono is the best thing that you can possibly do. But follow up with them and don't just give them advice. Help them if they need to open up an account, if they need to find a term insurance policy, walk them through the steps, get them started. Because again, at the end of the day, advice is nothing unless it's executed on. So if you're out there listening to me, reach out to me and hopefully we can build a community where we can help a lot of people across the country who aren't really meant for the financial planning industry. Okay, talk to you next time.
