The Client Review Kit

Lexie Giusti, Sr. Marketing Consultant
Sheeva Izadi ,Marketing Consultant

You’ve been working with a client for months on end, providing them with the tools and strategies to enhance their financial plan. It feels as if things are going smoothly and their money is producing the results they want to see, so why not just leave things as they are?

Well, because a lot can change in a person’s life in a period of time as short as a month. Any number of events could occur ranging from a death in the family to a wedding or the birth of a child or grandchild. All of these happenings could lead to a change in the financial reality they are living with or see themselves living with in the future.

Scheduling an annual client review is often overlooked in the financial planning process when it could arguably be the most important step. Having a face-to-face, personalized meeting with your client to go over their progress and discuss any adjustments is an elemental part to creating that deeper connection and loyalty with them.

So why exactly is scheduling an annual client review so important? Let’s take a deeper look.

Statistics show that about 79% of consumers view their relationship with their financial services provider as purely transactional.

The modern client wants to feel that personalized touch from your services. They want to feel like a part of the family and simply sitting down with them for an hour to discuss their goals and needs can be the difference between positive client referrals or them switching advisors.

This leads to our next point – Increased personalization correlates to increased customer loyalty which correlates to more positive referrals. The more an individual feels they can trust you and that you care, they more likely they are to share that with their friends and family and encourage them to handle their finances with your firm. Even just showing them just how well their assets are performing can solidify your place in their lives and add value to why they are working with you to begin with.

Meeting with your client to go over their portfolio and its performance over the course of the year allows you to open the conversation into uncovering new assets they may have come into since your last meeting. Perhaps they would want to invest those assets into an existing policy, or maybe they’d like to look into a new account for those assets. You will never know what your client could be interested in until you sit down to really talk to them.

Everything included in our Annual Client Review Kit is there to enhance the time spent with your client and make the process as seamlessly smooth as it can be.

You will receive a customizable letter to invite your client to sit down with you, a comprehensive checklist to utilize during the meeting to be sure you cover all necessary topics, a fund allocation model to be used as a visual representation in your meeting to discuss how to best allocate funds, and finally an educational video of Angela Sloan discussing why client reviews are so important to her practice and the immense benefits they provide.

Set yourself apart from the competition and create deeper, everlasting relationships with your clients and download the Annual Client Review Kit today.

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The Silent Killers to Financial Wellness

Sam Payne RICP®, Business Consultant

He did everything right… he ate right, avoided excess carbs, sugar, and alcohol.  He exercised regularly, kept his weight and body fat (BMI) well below suggested levels. He did not smoke. He was the picture of health. So much so that he coached other individuals and helped them reduce their stress, weight, and increase their physical activity. Then he had a heart attack…

Bob Harper, the host of Biggest Loser, was struck by one of the silent killers of men and women in our society.  Fortunately, his physical condition helped him survive and subsequently recover from the attack.  Now he is on a mission to alert the public to the importance of health screening for the various Silent killers.  Conditions like Heart Disease, Hypertension, Cancer, Diabetes and Stress to name a few.

Many parallels can be drawn between Bob and any number of clients and prospects we come into contact with on a daily basis as it relates to their financial wellness.  Do any of these sound familiar…?

He/She worked hard for 40 years, always saved, contributed to a 401K or IRA, kept life insurance and health insurance in force, paid off his mortgage and reduced his debt to zero.  Then he retired…

  • Within a couple of years, the equity markets took a substantial bite out of his portfolio, to the extent that he is worried about his ability to maintain his lifestyle…
  • Or
  • 2 years later he was diagnosed with dementia and is worried about the affect the cost of care will have on his portfolio and the income it is expected to generate for his wife and himself….
  • Or
  • He/She retired at 67 and now, 3 years later, he is required to take RMD’s from his sizeable portfolio.  In the 3 years since his retirement, there has been a substantial shift in the political powers and new tax rates are in affect that will take a bigger bite out of his RMD’s than he anticipated.

These are examples of the silent killers to financial wellness.  Things like Market/sequence of returns, Taxes, Longevity, Inflation and Extended Care costs.  Our role is to help screen clients and prospects for their exposure to, or likelihood of being adversely affected by, these silent killers.

This month, Financial Wellness month is a perfect time to remind the public to be on guard for and to get screened by a financial professional for these silent killers.

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Considering Your Annuity Replacements Options Due to The Recent Market volatility

Josh Ver Hoeve, VP of Annuity Sales

A frequent conversation the annuity sales desk is having right now is related to annuity replacements. Due to recent market volatility we are receiving more and more calls looking to replace variable annuities that have market risk and/or high fees. Most clients are not able to handle the market volatility, especially when limited to their investment choices for upside potential. Some of you may have seen back in October that Ohio National announced to eliminate brokerage arrangements and stop the sale of variable annuity business.

Click Here To Read The Whole Article.

Others are aware of a choice made by VOYA about a year ago to settle out variable annuity income riders to clients, and now like Ohio National, VOYA is no longer in the annuity business. Even with a predominate bull market the past ten years, just a couple of volatile days in the markets have clients asking for safety – and rightfully so. FIA sales are beginning to increase while VA sales decrease. What advisors and clients are realizing is that with recent product innovation, FIAs are the best of both products.

Let’s start off this new year by making sure our clients are financially well. Based on these recent trends, we should be asking our clients the following questions:

  • Do they have annuities purchased within the last ten years that are doing what they wanted them to do?
  • Did they have an income rider but no longer need income or vice-versa?
  • Do they have an accumulation product that now is needed for income?

Asset Marketing Systems is committed to providing you with the newest and most competitive product solutions for your clients. This month we are highlighting two annuities you may not be too familiar with:

North American Versa Choice: An FIA loaded with benefits; high liquidity and income guarantees that double for home health care (2 out of 6 ADL trigger). The product also has accumulation potential.

Click on The PDFs below to Learn More About These Benefits

NAC versa choice 10 ELB

3 in 1 design

North American also has a great client brochure to help understand income needs.

Bridging the retirement gap

Delaware Life: Another FIA with an incredible income guarantee product called the “Target Income 10.” They recently increased their income guarantees on this product to be even more competitive. Delaware Life will not always be #1 on a guaranteed income spreadsheet but they are almost always in the top three and are #1 in many scenarios. If you are going to stick with a guaranteed income product and are not sure the exact year in which you want to trigger income, this is a great option. They will win in a lot of cases, but will always be competitive if something changes and you need income sooner than later. Click on the product guide here.

Contact our team today for more information on any these featured products! We can also help with any niche product recommendations and positioning, comprehensive product detail analysis, and sales concepts.

(866) 546-5267 | Option 1

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Facebook advertising: Is change a good thing?

Written by: Skott McKinney, Director of Marketing & Creative services, Asset Marketing Systems

In the shadow of the Facebook privacy “scandal,” Facebook recently revealed that they’d made significant changes in their platform. I believe that this is a tactic to divert the public’s attention away from data hoarding to focus more on Facebook as a company of equal opportunity.

So, what really changed and how does this affect the financial services industry?

In a nutshell, Facebook has decided to remove approximately 5,000 targets that they felt had the potential to be misused, financial data targeting included. Facebook also states that they’ll be rolling out a new and required certification to all U.S. advertisers through its Ads Manager tool. This tool will require advertisers to register their compliance with Facebook’s non-discrimination policy before they can post ads.

Here’s a quick explanation of FB targeting:

Ads get optimized for affluent prospects. Up until recently, advertisers had been targeting potential clients by spending habits, debt, age, race, income, net worth, liquid assets, married, engaged, in relationships, birthdays, and the list goes on and on. Based on these targets, an advertiser could capitalize on your situation and habits to become part of your life and forever be present throughout your online experience.

There are a handful of other tools that help advisors determine the best client approach. A Facebook Pixel can be run hundreds of times a month, capturing user’s engagements from the second they click on an ad. This includes capturing spending habits, interests, etc. by following them across all web channels people visit. This is not changing yet, but it’s important to note because legacy advertisers will be able to leverage this captured data as a way to stay prominent and will not have to rely on the targets that are no longer available.

Many of the resources you rely on to fill your workshops primarily use Facebook. This is mainly due in part to the previous endless landscape of targets, but more specifically more GenX and Baby Boomers are users. In fact, of the 1.45 billion active users this year, 72% are age 52-64, and 62% are age 65+. To compare, in 2017 61% of users were age 52-64 and 56% were 65+.

How will seminar marketing vendors stay successful?

If a vendor has been running ads for a while, they’ll benefit from the learned information their combined ads and pixels have been capturing.

This combination of learned Pixel data and age/location targets will enable vendors to maintain qualified prospects in the changing facebook environment. I’ve learned that this methodology was deployed by a few of our vendors before the Facebook change, as a way to test success. Our vendors are claiming that this methodology is producing results similar to the campaigns sent prior to Facebook’s change.

It’s important to note that Facebook has also improved their algorithms to help offset changes, and they’re doing a better job of optimizing ads utilizing Pixels.

Final thoughts

Through 2019, I think we can expect to see moderate success from companies who have established data points, however, I suspect favorable rates of success will decrease towards the end of 2019 for companies that do not have additional resources to collect demographic data outside of Facebook, i.e., direct mail, continuously running a needs analysis to blind audiences, or list purchasing, which add complexity to the organization and may ultimately drive campaign costs up.

I believe that a change of platform is inevitable and advisors will need to turn attention to other platforms geared towards engaging the public’s desire to buy products, such as Amazon. These companies aggregate data to determine a buyer’s persona and ultimately market other products based on the buyer’s previous purchases. Imagine knowing how your clients spend money to better position you to interact with them.

Be on the lookout for future posts on the subject of alternative platforms.

It’s never too late to start your social media strategy. Click here to download Hootesuite’s 8-step guide to developing your social media presence. 

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Social Media

Written by: Skott McKinney, Director of Marketing & Creative Services, Asset Marketing Systems

I recently posted a blog and whitepaper focusing on the challenges advisors continue to face using social media. These challenges still exist, but there are ways around them and plenty of opportunities for your marketing to improve using social.

According to a recent report provided by the GlobalWeIndex, 30% of social users use social to research/or find products to buy. Additionally, they’ve identified that 1 in every 3 minutes online is spent on social media.

While surveys and research show increasing trends, I still believe that a successful marketing plan will include digital and traditional methods to produce the best results. The best advice I can give is “When you see the shiny penny, don’t assume it’s going to stay shiny. Give yourself options, and you’ll be successful.”

Download this insightful report here to see the trends dominating the social media space and to understand:

  • Which demographics are engaging with social media,
  • how users are spending their time on these platforms,
  • which devices are being used for social networking.

Click here to download the complete report summary.

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Millennials Don’t Want to Do Business With “Mom or Dad’s Agent”

Jennifer Mann, LUTCF, CLU, ChFC, CFP, vice president of the Chicago office of Lenox Advisors and 13-year MDRT member, got into this business 14 years ago because “the overall planning aspect got me excited,” she says. Her practice focuses on professionals in their 20s, 30s and 40s. She works from home most of the time, with 70% to 80% of her work done over the phone, as her clients live all over the country. We talked to her about her practice and path to success.

Your clientele skews younger. What do you like about working with this demographic?

Relative to what’s considered high-net worth, they aren’t necessarily there yet. They haven’t accumulated as much, but they’re young, and they’re going to be there. Plus, I like getting people early on, before they make too many financial mistakes, and where you’re building a relationship for the future. They’ll be clients for life, and you’ll grow with them.

Where does life insurance come in?

In the protection component; that’s when we start talking about it, but it also flows over into the retirement too. I do a lot of whole life, and while the primary purpose for insurance protection is the need for a death benefit, there are many supplemental uses for this great product as well.

Do you layer in term as well?

Yes, definitely. I typically talk about the four phases of life that life insurance can help you with. Phase one: I have a family and want to make sure they’re taken care of if something happens to me. Phase two: I’m starting to make some money, so I’m sensitive to taxes. Phase three: I’m in retirement, and I’d like the option for some tax-free income. And phase four: Whatever I haven’t spent, I’d like to pass on to whomever or whatever organization I choose versus Uncle Sam.

People may be in multiple phases at once or may skip a phase all together. But that’s how I start the conversation. My strategy is to first help them get the right amount of coverage and then the right structure as quickly as possible. We start with term and convert as appropriate.

Millennials often get a bad rap. What’s been your experience working with them?

Younger people saw what happened in 2008 and even again in 2010, and are more fearful of the market. They like the safety of life insurance, and want more guidance on the investment side. I also find Millennials are asking more questions.

From their perspective, they’re proud of doing research, asking questions and, honestly, not using “dad’s guy.” The feel like their parents’ advisor is helping them as a favor, because of how little money they have. Millennials want to be more hands on. They want to learn and not accept “this is how we do it.”

What objections do you hear when it comes to getting life insurance coverage, and how do you address them?

The biggest objection is the amount. $1 million sounds like a ton of money to people, but with younger clients, they’ve never thought about what that means. They say, “I would pay off my mortgage,” but that may or may not be the best thing for them to do. Or, they say, “My family would help,” but they don’t take into account a host of other things.

The other objection I hear is the premium. Again, they say, “My family would take care of us.” Or they’ve heard, “Buy term invest the difference,” so they’re anti permanent insurance. But once we start looking at the numbers, a lot of times that’s overcome.

What are the biggest mistakes you see fellow agents and advisors making?

For new advisors, it’s not doing joint work. Half of something is better than all of nothing. I did almost exclusively joint work my first two years, and that helped. I worked with multiple people so I could learn different styles and philosophies.

Also, some are afraid to prospect until they “know their stuff,” because they don’t want to look bad in front of friends and family and people they don’t know. But the reality is, you can always bring someone in to help with the product knowledge, but if you have no one to see, you have no business.

What can they do to improve their business or better serve their clients and prospects?

Become involved in organizations like MDRT where they are continuously learning and improving their minds, their craft and their business. And then, implement what you learn. If you‘re going to stay in this business, love what you do and care about your clients. Your sincerity shows through and that’s how you build relationships.

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DOL Fiduciary Rule Struck Down by Appeals Court

The U.S. Court of Appeals for the Fifth Circuit (which covers Texas, Louisiana and Mississippi), in a surprising 2-1 decision late yesterday, overturned a lower court decision and vacated the U.S. Department of Labor’s fiduciary rule with respect to retirement advice.

The court held that the agency exceeded its statutory authority under retirement law (ERISA) in promulgating the measure. The rule requires that advisors act in the best interests of their clients in retirement accounts and had survived repeated previous court challenges.

The Fifth Circuit decision came just one day after the U.S. Court of Appeals for the Tenth Circuit held that the DOL did not “arbitrarily treat fixed indexed annuities differently from [traditional] fixed annuities” under its fiduciary rule. Meanwhile, the U.S. Court of Appeals for the D.C. Circuit still has an active case considering the efficacy of the DOL fiduciary rule. None of these intermediate appellate courts is bound by decisions of the others.

According to the Fifth Circuit panel majority’s decision, the DOL acted unreasonably, arbitrarily and capriciously in expanding a 40-year-old definition of “investment advice fiduciary,” and did not deserve the deference that courts usually accord federal agencies. The court noted that while the DOL “has made no secret of its intent to transform the trillion-dollar market” for retirement investments, it was “not hard to spot regulatory abuse of power when an agency claims to discover in a long-extant statute an unheralded power to regulate a significant portion of the American economy.” Moreover, “far from confining the Fiduciary Rule to IRA investors’ transactions, DOL’s regulations affect dramatic industry-wide changes because it’s impractical to separate IRA transactions from non-IRA securities advice and brokerage. Rather than infringing on SEC turf, DOL ought to have deferred to Congress’s very specific Dodd-Frank delegations and conferred with and supported SEC practices to assist IRA and all other individual investors.”

Chief Judge Carl Stewart’s dissenting opinion argues that “the DOL acted well within the confines set by Congress in implementing the challenged regulatory package, and said package should be maintained so long as the agency’s interpretation is reasonable.” In his view, “That the DOL has extended its regulatory reach to cover more investment-advice fiduciaries and to impose additional conditions on conflicted transactions neither requires nor lends to the panel majority’s conclusion that it has acted contrary to Congress’ directive.”

In a joint statement, the Fifth Circuit plaintiffs (including the Financial Services Institute, the Securities Industry and Financial Markets Association, and the U.S. Chamber of Commerce) stated that “the court has ruled on the side of America’s retirement savers, preserving access to affordable financial advice. Our organizations have long supported the development of a best interest standard of care and the Securities and Exchange Commission should now take the lead on a clear, consistent, and workable standard that does not limit choice for investors.” It is still unclear what the fate of the DOL rule is going to be. The federal appeals courts are split on its legality. The DOL is going to have to decide how it wants to proceed. Typically, in a case such as this, a federal agency would decide whether to ask the full Fifth Circuit to reconsider the decision en banc or to appeal the case directly to the U.S. Supreme Court. However, this matter is further complicated in that the Trump Administration’s commitment to the DOL rule is unclear at best.

The SEC, meanwhile, has been examining whether to craft its own higher standard of client care. FSI and other industry stakeholders have continued to emphasize that they support such an SEC-created uniform fiduciary standard. These stakeholders have met numerous times with the leadership of the SEC in an effort constructively to engage with the regulators with respect to the creation of that standard. Those efforts will continue. We should not expect clarity about the DOL rule for some time yet. As always, I will keep you apprised as matters develop. Moreover, while we wait to see what happens next, I encourage you to contact me with any questions you may have.

Robert P. Seawright
Chief Investment & Information Officer
Madison Avenue Securities, LLC

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Roger Ibbotson

Roger Ibbotson, economist and creator of the iconic “Stock, Bonds, Bills, and Inflation” (SBBI®) chart, today unveiled his latest research that analyzed the emerging potential of Fixed Indexed Annuities (FIA) as an alternative to bonds in retirement portfolios.
READ MORE at PR Newswire »

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Building a Successful Marketing Plan

Growth doesn’t just happen. You have to plan for it.

Written by: Skott McKinney, Director of Marketing & Creative Services at Asset Marketing Systems

A strong marketing plan can be essential to your business success, allowing you to capitalize on your strengths, focus on your highest potential clients and relationships, and deliver your message effectively.

In this workbook, we’ll show you how to create a marketing plan in four steps.

  • Identify an ideal client or a target market.
  • Choose appropriate tools and tactics.
  • Develop a tactical plan and a marketing budget.
  • Track results and make adjustments.

Our goal is give you the tools to make marketing an integral part of your business — to help you set yourself apart from the competition and win and sustain profitable relationships.

Download PDF

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Nationwide New Heights

The Nationwide New Heights is not a new product but certainly needs more attention. The New Heights can accomplish quite a bit. Accumulation, Safety, Income, and Legacy. While many of us may already be familiar with the accumulation potential, I will still discuss some recent stats and information on the accumulation. However, I really would like to point out the income story the product provides and make sure none of us are missing opportunities by not adding the New Heights High Point 365 income rider.

On January 15, 2018, Nationwide increased the participation rates by 5% on the JP Morgan Mozaic II index. The JP Morgan Mozaic II index replaced the JP Morgan Mozaic I last year and performed just as well over the two-year period since the New Heights 12 has been available. The JP Morgan Mozaic II 2017 return was 9.02% on New Heights 12 contracts, and the two-year return would have been 24.32%. The index is designed to provide consistent and reasonable rates of return in any market condition. We often use the baseball analogy when we refer to the Mozaic II calling it the “single and doubles” hitter versus the homerun hitter. Let me explain, in the year 2000 through 2002, the index itself (without increased participation that we currently and have had on the product) would have returns of 6.30%, 2.37%, and 6.74% respectively. (LINK TO JP MORGAN MOZAIC II Performance – In 2008 when we saw losses of 40% in the S&P 500 the JP Morgan Mozaic II index would have returned 4.27%. Likewise, in 2013 when we saw substantial growth upward of 30% in the S&P 500, the JP Morgan Mozaic II would have had a return of 7.65%. Why is this important? We’re trying to compete with securities based product returns, but with our markets at all-time highs why would you not allocate a significant portion of a client’s portfolio to a product that can continue to provide reliable and reasonable returns with much less volatility and risk. Click here for the Nationwide New Heights 12 year rates or click here for the Nationwide New Heights 9 year rates.

See the JP Morgan Mozaic Index II brochure here to learn about the index and understand why and how it provides these consistent returns.

For those of you who have heard of Roger Ibbotson, his ZEBRA Edge NYSE index (the only FIA index branded on the NYSE) is also on the Nationwide New Heights with as high as a 135% participation and 1% spread.

The ZEBRA index gives you much more exposure to US Equities than the JP Morgan Mozaic II index would. The NYSE ZEBRA picks from US equities balancing into “cool stocks” versus “Hot stocks.” The index evaluates all 500 of the most significant publicly traded companies in the US every quarter and removes the most popular and volatile ones. The index selects an average of 197 stocks, at which point the NYSE applies a risk control methodology that makes daily adjustments to these stocks, US Treasuries, and cash.

The actual return to the Nationwide New Heights last year using this strategy was 19.55%, and the two-year return was 26.06%.

Click here to learn more about the Zebra Index Brochure, and to read an informational whitepaper authored by Roger Ibbotson and Zebra capital.

Once you understand the New Heights income rider, you will also appreciate the death benefit rider. At Asset Marketing Systems, we have had a low percentage of Nationwide New Heights contracts issued with their High Point 365 Income rider, which has a cost of 0.95% per year. We are seeing that many advisors are using the product as an accumulation and safety product only, and would prefer not to have the rider fee. We’re not trying to compete with securities based product returns, but with our markets at all-time highs, why would you not allocate a significant portion of a client’s portfolio to a product that can continue to provide reliable and reasonable returns with less volatility and risk.

It’s often easier to sell a product that has an income rider without a fee, but that product typically “charges” the client in the form of a lower cap or higher spread, which often results in lower accumulation potential. I would imagine if the Nationwide New Heights had a 100% participation with no spread or fee, but gave you the income rider for free, you would be very interested in the income rider, right?

The Nationwide High Point 365 rider has a five-year deferral requirement before activating income. The withdrawal factors increase, and the income base continues to increase even when taking free withdrawals. Your client can take free withdrawals from the contract years 2-5 to get to that guaranteed income in year six.

As many of us know, this product can track values daily, allowing them to lock in your income value at that highest daily value. Your income base is the highest point on any given day of the entire contract period before you trigger your income.

How big of a deal is this? Well to give you an idea, just last year in 2017, the JP Morgan Mozaic II index had 57 different high points! That means 57 times last year you had a reason to call your client and let them know their income guarantee just went up 57 times! While we all know this is not going to happen every year, it is an incredible story.

What rate of return are you comfortable assuming on this contract in the first five years? Is it 2%? Perhaps 4%? Maybe 6 or 7%? Whatever that number is and whatever you are comfortable with, consider the highest daily value in that number and consider what the income would be even if you did assume an extremely conservative ROR during deferral before income. If we do a little math with conservative assumptions, we will quickly understand why this could be the best income rider in the business.

Nationwide uses this highest daily value to calculate your income amount. They also use a very fast and annually increasing payout factor. For those of you familiar with the Allianz 360 income factors, it is similar to those. Click here to see the income factors at each age and deferral. For case studies, click here.

The Nationwide High Point Death benefit rider is calculated the same way as the income value. Using the same method, they find the highest daily value, which becomes your death benefit. Furthermore, Nationwide has the only product on the market that allows a first to die feature (for no cost) and allows a first to die rider on a single owned annuity (even qualified money). There are many strategies and unique planning options around the first to die feature, which will only help your clients.

Lastly, you should consider the fact that this product is offered through an A+ Mutual carrier. To this date, I’m not aware of a mutual carrier who offers a fixed indexed annuity that can come close to competing with this product.

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