Are Northwestern Mutual employees trapped?

No, every agent, rep, financial advisor, wealth management advisor is fully independent. They hold a contract with NM and hang their licenses there as well as utilize their tools and investment platform (Pershing LLC clearing company and Northwestern Mutual Investment Services/Wealth Management Company Limited Services Bank).

They are not captive, they have access to any brokered product (Prudential, Trans, Banner, etc.).

That being said, the average NM client is very affluent. Well above average income in the USA, which by the way is only about 60k for a household. Whole Life is not for everyone. Namely, people with lower income that aren't already maxing out all qualified accounts unless they have certain needs such as legacy/permanent care over another human etc.

Without going too deep, NM products are world class, they are a AAA rated company by all but one rating agency (the same agency that downgraded the USA from AAA). They are a mutual company (no stock holders). They have been in business over 160 years and paid a dividend to policyholders for 145+ years straight without ever missing a dividend payment. They have over $200B in their general account (think insurance) and another $200B+ in AUM (think client investment assets) If you need insurance and are healthy enough to own an NM policy, there are very few alternatives with similar financial strength. If you have investment management needs they are often cheaper than alternative brokerages or investment advisors.

NM can write very large life insurance policies for companies. Look up company owned life insurance (COLI) and you'll learn quickly, this is a product that helps the rich get richer while this sub would paint it as a way to keep the poor poorer, but why would fortune 50 companies have NM policies?

That being said, none of that matters if you have 0 years experience and just entered in as a salesman.

TL;DR: As a firm NM is nearly unparalleled with AAA ratings and a 160+ year history and $400-500B in assets. However, all advisors are independent and none of the strength of NM matters if the advisor in question sucks.

/r/personalfinance Thread