I don’t know about you, but my mailbox is loaded with solicitations for financial products. Lately the box is crammed with offers for financial advice, discounts on brokerage, insurance, retirement planning, and annuities. Many offer free lunches or dinners to go along with the free advice.

How do you spot the good from the bad or the ugly? It’s not easy. All good salespeople will sound very professional and offer ‘sound, proven methods’ or products. In this age of instant communication and e-mail solicitations, investor discernment is crucial.

If you did not initiate the contact with the salesperson or organization, or you have not done business with them previously, ask for something in writing. Review the sales literature and the product’s promises before you set an appointment with the sales representative.

A key characteristic of any financial product, that will separate the good from the bad, is the fee structure. What are the fees, commissions, and ongoing expenses for owning and holding the investment? If this is not detailed and specific in the sales literature and prospectus, ask for it up-front or move on to another investment or firm.

All financial products have fees and expenses - yes, even “no-load or no-commission” investments. You can’t expect people to create and handle investments for you, and not earn a living. You earn wages and they need to also.

But the bottom line is the fees.  Are they reasonable and appropriate for the investment?

Some financial products come with a very expensive fee structure. For example, some managed mutual funds will have expense ratios above 1 percent, while many indexed funds have expenses of .3 percent or less. Exchange Traded Funds (ETFs) can have expenses under .20 percent.

Variable annuities are the classic example of a “guaranteed” investment with high expenses. Many impose annual charges of 2.5 to 3 percent or more. These expenses are taken out before you receive your return on the investment. Often they are sold with “no commission,” - that is, no commission up front and will pay the insurance company and salesperson a residual fee every year that you own the annuity.

Often investments are sold with a “minimum guarantee” for a level of performance. Keep in mind - unless the investment is a United States Treasury bill, note or bond, or a federally insured certificate of deposit - the “guarantee” is backed by the investment company itself. In order for the investment firm to guarantee the investment or return, it must take out insurance for achieving the promised return. The cost for this insurance is passed on to you either in the form of annual expenses or a reduced return, or both.

Read the prospectus to understand the fees and expenses that come with the investment. Ask questions. You should understand how the investment works, its expenses, and how the salesperson is compensated.

High expense financial products can be great income generators for the salesperson and investment firm. But you must ask, “Who is benefitting from this investment?” It’s your money and it ought to be you.