Thrivent Financial for Lutherans?

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Thrivent Financial for Lutherans?

Postby Pam » Sat Jul 26, 2008 2:10 pm

Does anyone have knowledge about investing at Thrivent Financial for Lutherans?

I'm trying to help an 89 year old friend who has inherited her son's estate, which is currently invested at Vanguard. Following the recommendation of some of her Lutheran church friends, she met with a Thrivent advisor and is considering moving the Vanguard investments there.

When I looked up Thrivent's prospectus on the net, they looked very expensive, with up to a 5% load, and 1.26% per annum mutual fund expenses. But she liked the advisor and the apparent church connection seems to put her mind at ease. Would it be best to encourage her to stay with Vanguard, or to suport her move to Thrivent?

Any advice would be much appreciated.


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Postby Mel Lindauer » Sat Jul 26, 2008 2:20 pm

Don't mix friendship, church and investing. Tell her to stay put; there's simply no reason to invest in loaded high expense funds, simply because they're associated with Lutherans. That's not a valid reason for changing, especially in light of the fact that it will cost her more for less.

Recommend that she just say "Thanks, but no thanks."

Regards,

Mel
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Postby Levett » Sat Jul 26, 2008 2:32 pm

Pam,

I just want to reinforce Mel's recommendation speaking to you as one Lutheran (ELCA)--with a Lutheran minister brother-in-law and strong family associations with Augustana College and California Lutheran College-- to another.

Do not leave Vanguard for Thrivent--it will be a costly and foolish decision.

Best wishes, Bob U.
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Thanks

Postby Pam » Sat Jul 26, 2008 2:39 pm

Mel and Bob, I'm grateful for your help. I'll share your well-worded advice with my friend and will try to persuade her to stay with Vanguard.

Best wishes,

Pam
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Fraud possibilities

Postby Gordon » Sat Jul 26, 2008 2:54 pm

Friend of mine and many of the people in her church were victims of a fraudulent scheme and lost millions. The scam artists had promised a generous donation for a building expansion program. The scam was a typical ponzi scheme where original investors were paid off with the funds of later investors. Once the scam artists got the scheme going the earlier investors helped keep it going.

Be very careful
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Postby alec » Sat Jul 26, 2008 3:06 pm

Pam,

The church connection is tenuous at best. Basically, she'll be paying a whole lot more for the exact same investments that she can get at Vanguard, namely much higher expense mutual funds. The Thrivent guy/gal is a broker, pure and simple. Or as the regulators call him/her, a registered representative. He/she is a salesperson, nothing more. Any Lutheran connection is merely a way to increase sales. Just like the First Command bozos that played up their "we only help military people" which should read, "we only screw military people out of thousands of $$ by putting them into really, really high priced mutual funds and insurance."

If she wants to support her church, or the Lutheran church, she can take the money she saves by staying at Vanguard at actually give it to her church. This could be thousands of $$ per year. :idea:

You could always tell her than I'm Lutheran and only invest at Vanguard and in other really low costs mutual funds.
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Postby mickeyd » Sat Jul 26, 2008 3:39 pm

Hey Pam,

I think that taking the advice offered above to avoid the Thrivent advisor may be the better move.

Thrivent was established in 2002 from a combination of two fraternal societies ~Aid Assoc for Lutherans and Lutheran Brotherhood. They should not make any assumption that the advisor/salesman has a deep association with the Lutheran church. He is a salesman who may or may not be a member of that faith or any other faith.

Vanguard would obviously be the better selection.
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Postby Murray Boyd » Sat Jul 26, 2008 3:40 pm

ECLA! Those heretics! LCMS is the true Lutheranism!

Just kidding :) I'm ECLA myself.

For a member-owned firm I can't understand how their expenses can be so high. I'm guessing corruption at the top.

Fun fact: they used to be called The Lutheran Brotherhood, but that sounded too much like a terrorist group.

Stick with Vanguard.
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Thanks

Postby Pam » Sat Jul 26, 2008 4:04 pm

Gordon, alec, mickeyd and Murray. I really appreciate your advice and the background information about Thrivent. The Thrivent advisor my friend talked to is a former Lutheran pastor, which made a huge impression on her. In fact, since my original post, two of her relatives are also planning to sign up with him!

Thanks to all of you for your counsel. You've made me feel much more confident about trying to get her to stay with Vanguard.

Best wishes,

Pam
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Postby Angel » Sat Jul 26, 2008 4:19 pm

My employer has our Simple IRA with Thrivent. The fees are extremely high. We are stuck with it for several more years because of fees to transfer out. Then hopefully we will change to Vanguard.
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Re: Thanks

Postby alec » Sat Jul 26, 2008 4:25 pm

Pam wrote:Gordon, alec, mickeyd and Murray. I really appreciate your advice and the background information about Thrivent. The Thrivent advisor my friend talked to is a former Lutheran pastor, which made a huge impression on her. In fact, since my original post, two of her relatives are also planning to sign up with him!

Thanks to all of you for your counsel. You've made me feel much more confident about trying to get her to stay with Vanguard.

Best wishes,

Pam


First off, this person is not an advisor, he is a salesman pretending to be an advisor. Secondly, being a former pastor doesn't really sound like the backround of a good finance professional. Look for degrees in finance, econ, MBA, etc.
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Postby mickeyd » Sat Jul 26, 2008 4:28 pm

In fact, since my original post, two of her relatives are also planning to sign up with him


:lol: Looks like he is picking them off one at a time. Gotta love that church directory!!!

As I said earlier, stay with VG and avoid the Thrivent/Lutheran Kool-Aid....
Last edited by mickeyd on Sat Jul 26, 2008 5:38 pm, edited 2 times in total.
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Alec and mickeyd

Postby Pam » Sat Jul 26, 2008 4:56 pm

Thanks for your posts. I'll encourage my friend to inquire about whether he has the type of credentials you suggested. She lives in a small town, so it seems that once some of the church members reported that they liked him, others are eager to join in.

Alec, good idea to try to make clear to my friend that the Thrivent "advisor" is a salesman. She said that he was "very helpful, and wasn't 'like a salesman'."

Thanks again to all of you for your thoughts.

Best wishes,

Pam
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Help them with the math

Postby Murray Boyd » Sat Jul 26, 2008 5:11 pm

One more thing: I've noticed over the last couple of years that people are really, really bad at math. Not so much bad really, but don't even try. Maybe it doesn't even occur to them to try. So it might help to do it for them. For example, Vanguard Total Stock Market's expense ratio is 0.15% (already eyes glaze over). So for a $100,000 investment, that's

$100,000 * 0.15% = $150 / year

And 1.50% E/R is ten times as much, $1,500 / year. People may not like math, but they should definitely like $1,350 / year! And I wouldn't be surprised if the Thrivent expenses are higher than that. Oh, and with loads too. This is a lot of moolah!
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Postby Levett » Sat Jul 26, 2008 5:33 pm

Pam and Murray,

The expenses are worse than Murray thought. Below I have copied and pasted a small section from the May prospectus for Thrivent funds. Make sure you are sitting down!

EXAMPLE
This example is intended to help you compare the cost of
investing in the Fund with the cost of investing in other
mutual funds.
The example assumes that you invest $10,000 in the Fund for
the time periods indicated and then redeem all of your shares
at the end of those periods. The example also assumes that
your investment has a 5% return each year, and that the
Fund’s operating expenses (and the operating expenses of the
Underlying Funds) remain the same. These figures include the
indirect expenses incurred by the Fund in investing in the
Underlying Funds. Although your actual cost may be higher or
lower, based on the foregoing assumptions your cost would be:
1 Year 3 Years 5 Years 10 Years
Class A shares $671 $962 $1,273 $2,155


Thrivent is using an example of a $10,000 investment, for which you can see what you will pay for Class A shares for 1, 3, 5, and 10 years (that's money you will never see again).

Now multiply by 10 to get an idea of what an investor would pay if you used Murray's example of a $100,000 investment.

Run. Don't walk. Bob U.
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Postby burt » Sat Jul 26, 2008 7:59 pm

Ditto everything above. My Mother was put into a Thrivent annuity wrapped inside an IRA with high expenses. High early withdrawal fees.

If you want to help the church, stay away from Thrivent and put your fund expense savings in the offering plate.
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Postby masscraft » Sat Jul 26, 2008 10:11 pm

burt wrote:Ditto everything above. My Mother was put into a Thrivent annuity wrapped inside an IRA with high expenses. High early withdrawal fees.

If you want to help the church, stay away from Thrivent and put your fund expense savings in the offering plate.


Same here.
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Thanks for more info

Postby Pam » Sat Jul 26, 2008 11:11 pm

Thanks Bob and Murray for your research and for putting the expenses into actual dollar amounts. Wow, those Thrivent fees come to a huge total per year! I'll apply those figures to the value of my friend's estate so she can see how much it will cost her per year to switch to Thrivent rather than stay with Vanguard. That should help her undertand how much more she would be paying for the "advisor."

Angel, masscraft, and Burt-it's valuable to hear about your experiences with Thrivent. Thank you.

My friend's son's estate will be her main source of income, so it's especially important that she not lose a lot to high fees. I'm grateful for your all of your help and guidance in how to help her make a good decision. "Run. Don't walk," --right!

Best wishes,

Pam
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Postby ryuns » Sun Jul 27, 2008 12:22 am

Whoa, this is like the most fired up I've ever seen a bunch of Lutherans. Goodness gracious!

It's very unfortunate that people use some kind of civic connection to help themselves rather than those they purport to be looking out for.

Ryan
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Postby Levett » Sun Jul 27, 2008 6:45 am

Ryan,

In Luther's words (translated!): "Here I stand. I can do no other." :) Bob U.
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Postby nisiprius » Sun Jul 27, 2008 7:46 am

[Deleting flip remark, partly in light of what NorthSouth says below].
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Postby NorthSouth » Sun Jul 27, 2008 8:23 am

Hold on here a second.....they helped me with a scholarship in University, pay for lots of events at the church I attend and, I believe, they are the largest financial supporter of Habitat for Humanity (the people that build houses in the Third World and poor sections of America).

However, I agree with the general thread.....invest with VG and give the difference to the church and other charities.
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My parents were recently approached too

Postby cremes » Sun Jul 27, 2008 1:56 pm

About 3 months ago my parents finally agreed to meet with a Thrivent rep who had been calling them for about a year. Within the past year I also had guided my parents towards a Bogle-inspired asset allocation away from their prior "bunch of stocks" investment strategy.

I accompanied them to the advisor's office and acted somewhat like their personal "advocate." While I am not nearly as knowledgeable as some folks on this forum, I've been a long time lurker back to the morningstar days. I know a few good questions to ask. 8)

Anyway, the sales job the advisor performed was quite good. He had a lot of reports and documentation showing the asset allocations by industry, region, etc. along with the style boxes for each investment type. I quizzed him mercilessly about the fees charged (annual, new investment, switching funds, etc). Where our communication broke down was his insistence on doing a separate report for each of my parent's accounts rather than treat all of their money as a single portfolio. I suspected some flim-flammery with the tax liabilities of the different account types.

Ultimately it came down to my request that he develop an asset allocation that was an apples-to-apples comparison between the Thrivent funds and my parent's existing Vanguard portfolio. I wanted to compare the 1, 3 and 5 year returns for each account along with the standard deviation of the returns. I also wanted to know the tax implications of selling the vanguard funds to convert to Thrivent along with any future tax liabilities that would come about from "rebalancing" to their "new" top 10 list of funds. You see, the funds they recommend today are probably not the funds they will recommend next year (or the year after). To get their "outsized" returns you need to sell your old holdings and buy the new ones. Lots of fees and taxes are involved.

That comparison finally made it clear to my parents that the higher fees and greater taxes were going to seriously impact their bottom line. The Thrivent portfolio had a 100 basis point charge while their current Vanguard portfolio averages about 17 basis points.

It was their decision to remain with Vanguard or convert to Thrivent. They elected to stand pat.
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Thanks

Postby Pam » Sun Jul 27, 2008 3:22 pm

cremes, it helped a lot to read about your experience with your parents at Thrivent. You've alerted me to important questions about portfolio turnover and taxes that I wouldn't have thought to ask. Now I'll be better prepared.

Best wishes,

Pam
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Postby sopogah » Sun Jul 27, 2008 5:46 pm

Jesus said: "Give what's to Caesar to Caesar, and what's to God to God"

I am a firm believer of separating church and estate. (or was it state? :lol: )
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Postby TLC97 » Sun Jul 27, 2008 6:22 pm

Pam,
I understand your concerns and agree with the above posters. I have used Lutheran Brotherhood (now Trivent) for insurance since after I completed college (40 years ago ). When I retired I automatically looked at Trivent's options for my investments. After comparing it with the funds and expenses to Vanguard, I stayed with Vanguard. Even my pastor wanted to know why I didn't go with Trivent since one of our elders and best friends is the Trivent agent. The numbers told the story.

Good luck and God's blessing on your friend.

Larry
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Re: Alec and mickeyd

Postby retiredjg » Sun Jul 27, 2008 6:49 pm

Pam wrote:Alec, good idea to try to make clear to my friend that the Thrivent "advisor" is a salesman. She said that he was "very helpful, and wasn't 'like a salesman'." Pam

I don't wish to offend any minister/pastor/preacher types, but who else on the planet has more experience in putting people at ease, gaining their trust, and helping them believe in something? The fact that he isn't "like a salesman" only means he is a really good one. jg
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Postby retiredjg » Sun Jul 27, 2008 7:01 pm

One other thought Pam. You mentioned loads up to 5%. It should be easy to show your friend that she doesn't have to pay anything for her VG funds, but will have to actually pay up to 5% to buy some other fund.

I'm afraid if you go too far into detail, your friend may get confused if she has no previous investing experience. However, this point is pretty easy to grasp. Why buy new stuff when the old stuff is free and cheaper to maintain?

Best of luck to you. You are doing her a great favor and are a good friend. jg
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Postby PaPaw » Sun Jul 27, 2008 7:50 pm

I too am an ELCA Lutheran. A few years ago I briefly thought about buying some Thrivent funds but after much study and consideration (the economic facts took about 2 seconds to understand, the rest of the time I spent trying to decide if I were missing something - I don't think I was), I decided to stick with VG.

Like others have said, save your money by investing at VG and give it to your church if you are so inclined.
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Postby badger » Sun Jul 27, 2008 7:51 pm

We actually have an insurance policy for my husband which was taken out when he was a child originally with Lutheran brotherhood and what is now Thrivent. Thrivent does not like to have their mutual funds written about by the financial press, I remember that they got quite snotty with some reporter who was trying to get information about some of the mutual fund offerings.

I have a friend who has their retirement with Thrivent, the fees are very high
and I have heard her trying to figure out why her agent was giving her so little money and it was costing so much.
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Postby heyyou » Sun Jul 27, 2008 8:04 pm

Thrivent does donate a lot, probably as much as other fund families spend on advertising. With those fees, they can afford to be generous. Moneychangers in the temple, again.
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Thanks

Postby Pam » Mon Jul 28, 2008 1:16 am

I appreciate your responses. I'm grateful to hear about your experiences with Thrivent and for your thoughtful comments. jg, you're right that my friend didn't understand when I explained the details of the fees. I'll follow your suggestion to focus on the expense of the load, which should make more sense to her--and it'll be a hefty sum!

Sincere thanks to all of you for your time and generous help. You've greatly boosted my resolve to try to persuade my friend to stay with Vanguard.

Best wishes,

Pam
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Postby maywood » Fri Sep 30, 2011 8:32 am

Short answer: I agree with those who say stick with Vanguard and donate the savings if they want to.

My family is ELCA Lutheran and my dad has some annuties with Thrivent. The former pastor at my former church's wife is a Thrivent rep.

Their website says they are not-for-profit and that "Being membership-owned, Thrivent Financial does what's best for our members, supporting the values of faith, family, stewardship and service".

I have been helping my parents with their investing for about 5 years now, and took a good opportunity with they moved to a different state to transfer many of their assets from a Raymond James account to Vanguard. However, the Thrivent annuities remain. And a Thrivent rep at their new church recently ran some reports for them that my Dad emailed me to look at, trying to convince my dad to put yet more of their savings in annuities to generate income. I really haven't had a chance to look at the reports yet. Luckily my dad realized that the rep ran the reports to try to sell him more annuities, but still wants me to take a look at the reports.

Recently my church has been talking about the "Thrivent choice" program where a member can recommend how Thrivent spends their outreach dollars.

It is true that Thrivent does charitable outreach programs. "Its business operations fuel its charitable outreach", according to the website. However, I agree with the posters above who say it would be better to stick with Vanguard and donate the difference. I don't believe you can deduct the upfront load or higher expense rations, but if you stick with Vanguard you can certainly deduct any direct charitable contributions made with the savings.

I really don't like the idea of mixing church and investing, and using peer pressure from church members and/or the pastor to try to persuade someone to move to Thrivent.

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Postby MarathonInvestor » Fri Sep 30, 2011 9:40 am

I used to have a mutual fund and IRA at Thrivent (formerly Aid Association for Lutherans and Lutheran Brotherhood). After educating myself over the last year on investing and embracing the boglehead philosophy I moved all of my assets from Thrivent to Vanguard due to the high expenses and lackluster performance of the Thrivent funds.

I would however recommend Thrivent for life insurance. I currently have term life insurance through them and have been recently looking at getting a longer term policy and have found their rates to be quite competitive.

Thrivent = good for life insurance; bad for investing
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Re: Thrivent Financial for Lutherans?

Postby Dingle » Fri Sep 30, 2011 9:52 am

Pam wrote:Does anyone have knowledge about investing at Thrivent Financial for Lutherans?

I'm trying to help an 89 year old friend who has inherited her son's estate, which is currently invested at Vanguard. Following the recommendation of some of her Lutheran church friends, she met with a Thrivent advisor and is considering moving the Vanguard investments there.

When I looked up Thrivent's prospectus on the net, they looked very expensive, with up to a 5% load, and 1.26% per annum mutual fund expenses. But she liked the advisor and the apparent church connection seems to put her mind at ease. Would it be best to encourage her to stay with Vanguard, or to suport her move to Thrivent?

Any advice would be much appreciated.


Pam

Hi Pam

This is a DIY investment forum that promotes low cost investing with Vanguard.

Are you expecting unbiased responses? :roll:
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Postby gatorking » Fri Sep 30, 2011 10:15 am

FYI: This thread was started in July 2008.
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Postby burt » Sat Oct 01, 2011 8:16 pm

gatorking wrote:FYI: This thread was started in July 2008.


And it's still relevant today.

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Re: Thrivent Financial for Lutherans?

Postby z3r0c00l » Fri Nov 08, 2013 10:47 pm

[OT comment removed by admin LadyGeek] Anyone convinced to give 10% to an organization will surely give 5% to another.
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Re: Thrivent Financial for Lutherans?

Postby nedsaid » Sat Nov 09, 2013 12:41 pm

This is a difficult issue. I think the best advice is to attend and support your church and keep your own counsel on your personal finances.

In attending a house of worship, folks want the sense of community that exists there. Joining church related organizations helps bind people in that community. But somewhere the line has to be drawn. At some point, a family needs to be able to find the best deals it can get in arms length transactions. A sense of obligation to your community should not keep you from using your family's limited resources in the most efficient manner possible. Belonging to a house of worship does not obligate you to invest in the same way your fellow congregants invest.

I have a friend who was in the brokerage business for just over a year. Another friend went into the insurance business. I gave both of them my business and fortunately in both cases it worked out. But I am sure you have read many horror stories on these boards where doing business with friends and relatives didn't work out.

Most of the time it works best if you keep your financial life separate from your relationships with friends and family. This is a difficult issue to navigate. Best of luck.
A fool and his money are good for business.
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Re: Thrivent Financial for Lutherans?

Postby Call_Me_Op » Sat Nov 09, 2013 12:48 pm

No!!! I recently saw an episode of "American Greed" that warned of investing with friends from church. Stick with known respected big names!
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Re: Thrivent Financial for Lutherans?

Postby tat2ng » Sun Nov 10, 2013 9:10 am

Call_Me_Op wrote:No!!! I recently saw an episode of "American Greed" that warned of investing with friends from church. Stick with known respected big names!


Thrivent Financial is not friends from church. That being said, I'd rather invest with Vanguard, and give money to my church at my own discretion, as opposed to paying higher fees to Thrivent.

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Re: Thrivent Financial for Lutherans?

Postby BL » Sun Nov 10, 2013 10:10 am

AFAIK, Thrivent is a fraternal organization. As in other similar organizations, rather than pay stockholders, they distribute organization profits back to communities. However, the salesmen and probably other people in the organization make lots of money based on the fraternal concept. I don't think this is unique to this organization.

I don't consider this a good place to invest, especially compared to Vanguard and other low-cost companies. But I do consider it somewhat equivalent to other investment companies such as EJ, etc., that charge similarly, but where the company also accumulates a profit for themselves and their shareholders. Since I would rather have that money come back into the community, I would prefer Thrivent, maybe depending on the products the salesmen promote, if you need hand-holding and insist you can't do anything on your own (and can't find a good fee-only person). Small town folks don't have much local choice and computer-challenged folks have an added problem. I would like to proselitize for Vanguard, but try hard to resist.
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Re: Thrivent Financial for Lutherans?

Postby Beat The Street » Sun Nov 10, 2013 11:01 am

My in laws have some accounts with Thrivent and they received a letter a few months ago that said the company was changing from "Thrivent for Lutherans" to "Thrivent for Christians". I suppose they realized there is a much bigger market for Christians.
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Re: Thrivent Financial for Lutherans?

Postby Padlin » Sun Nov 10, 2013 5:06 pm

40+ years ago the AAL rep for life insurance was a member of our church, my parents bought all the kids policies, and most of us still have it. About 15 years ago living in another state in the process of upping my policy the then current rep (who was a Lutheran) came over and wanted to talk investing after our insurance business was complete. I checked into it at the time, as I recall they had 3 funds, all with bad returns and high fees, I passed. A few months ago I went to make a change to my insurance and found my old rep now specializes as an advisor and no longer does the insurance portion of the job. For a mediocre product they must do pretty well selling it. My "new" insurance rep lives another state.

Used to be their business card stated there church affiliation, don't know if that's still the case.

If my mother had Thrivent investments, at 87 I wouldn't try too hard to get her to change.
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