Category Archives: Blog

How do you describe an indexed annuity?

January 26th, 2022 by

The best explanation I have heard to describe an indexed annuity is that “It is an insurance contract that provides and better than average chance of a better than average return without the risk of market loss.”

That is compelling enough! Don’t oversell and with a proper factfinder that identifies income gaps, using income riders to create income floors turns the account value into no more than a potential death benefit.

Original post: https://www.linkedin.com/posts/annuity-agents-alliance_mytwocents-indexedannuities-software-activity-6887375750081630208-__QC

Got ‘Dry Powder’?

December 3rd, 2021 by

Annuity Marketing | Annuity Leads
  • Higher-risk investments tend to pay higher returns.
  • Using an annuity to create a stable income floor can help a client be more aggressive with investments.
  • Access to guaranteed income could help you invest more in your own business.

I have been spending a lot of time lately working on my retirement finances. After working with fixed annuity agents for over a decade, I have noticed that sometimes we help other people more than we help ourselves. This is a huge mistake because we should lead by example.

Around age 48, I started practicing what I preached with the purchase of annuities with income riders (seven annuities and counting). At age 53, I am looking at second-to-die life with long-term care riders and making some decisions about cash-value-building life insurance as well as some other things to create long-term tax-advantaged cash flow.

When I am looking for inspiration and on the concept of income floor planning, one of the people I like listening to is Tom Hegna. Tom was a keynote speaker at the Round-Table Radio Marketing Conference. I spend nearly every working day of my life designing annuity-based income plans for the agents I support and sometimes forget about the importance of life insurance, but Tom was able to get me motivated to add more life insurance to my portfolio.

For risk-based investing, one of the investors I listen to is Rick Rule, who specializes in precious metals and fixed assets. Rick, unlike many precious metal investors, does not turn his commodities investing into a religion. He approaches investing from a pragmatic, Warren Buffett-style philosophy: Only invest in what you understand. Turning investing into a religion is very dangerous because it can blind you to the various angles of risk.

What I also like about Rick is that he constantly talks about being capitalized and having “dry powder.” In other words, money that sits around and does nothing until there is a market crash, so you can take advantage of below-intrinsic-value prices on equities and assets.

So what does any of this have to do with annuity sales? More than most people realize.

Dry powder can only be used with certainty when you have an income floor. An income floor allows you to have the confidence to allocate capital to risk when everybody is running from the fire.

Think about this with respect to your personal finances. What if you had all the residual lifetime income you would need guaranteed for the rest of your life and then had a bunch of cash sitting on the side? How would that make you feel?

One, you would have a massive amount of pressure released from your shoulders.

Two, you could confidently take advantage of buying opportunities in fixed assets, commodities, and equities when everyone else is liquidating. You would also feel great freedom and less reserve to invest in your business. This could create massive amounts of wealth over the recovery period, which is typically a short period of time.

That leads us to some very important questions:

  • Are you attacking this business knowing the potential of building an income floor for yourself and having a bunch of dry powder waiting for the right opportunity?
  • Are you allocating capital to marketing and working your sales process considering the massive demographic opportunity to share this strategy with others?
  • Are you selling the income-floor and a dry-powder philosophy with passion and enthusiasm to your clients and prospects; not just as a planning philosophy, but from a belief rooted in your own personal finances?

I am not a fan of man-made religions, especially those that are rooted in money. But, unlike risk investing religions, fixed annuity agents get to believe in something that has guarantees. In my book, that makes what we do worth believing in.

Just like adherents of all religions:

  • We have to believe in something.
  • We have to demonstrate that belief through personal practice.
  • We have to share that belief with passion based on the confidence we achieve from our practice and the experiences and testimony of those that have the same belief.

Are we sharing a religion or a cult? A cult is a religion with a belief based on a lie.

For myself, and I hope for all my fixed annuity agent partners, I truly believe that having a guaranteed income floor is the best insurance someone can buy on this earth other than life insurance. I think it makes people happier and live longer by removing stress.

For me, that is a fact, not a theory, because it is something I practice, not just preach. I have seen the impact in my life and all those I have shared my beliefs with. They are happier and more secure in their retirements. Not only is the guaranteed lifetime income annuity religion is worth believing in, but it’s also a proven way to live life with less stress while providing the flexibility and opportunity to allocate liquidity to take advantage of undervalued assets.

If you need more faith, listen to Tom Hegna. It will help you become a believer. Sometimes when your faith is lacking it doesn’t hurt to utilize the faith of others.

Reprinted with permission from the 2021 online edition of ThinkAdvisor © 2021 ALM Media Properties, LLC. All rights reserved. Further duplication without permission is prohibited. For information, contact 877-256-2472 or reprints@alm.com.

Are you ready for 2022?

November 24th, 2021 by

What are you doing now to make 2022 the best year in your business? FIA sales were up 30% in the 3rd quarter this year.

Two of our top producers this year told me, “I am having my best year ever but I didn’t work any harder”.

I believe 2022 will represent an even better situation to fit that statement.

Inflation and people’s concern over our economy are going to drive the motivation for yield and security which will stimulate FIA sales. If we have any slips in the markets, VA and RILA sales will shift to FIAs.

Now is the time to expand your marketing for 2022. Get committed to a sales process that drives case size and closure rates and decreases the number of appointments to close.

No matter how big your business is, your biggest cost in 2022 will be opportunity loss. Whatever share of the $60 billion + FIA business is not yours, that is where you are losing the most money. Let us help you take advantage of that opportunity instead!

We are always here for you to help with Marketing, Sales Process, and Case Design. Click here to learn more.

Personality or process?

November 8th, 2021 by

I was just talking to a prospective agent partner and he asked me about a top seller he had been listening to.  He said he was having problems even coming close to duplicating the results of the top seller.

I told him, “Duplication of someone else’s success requires that you separate the personality from the process.  Once you have the process, duplicate that and use it to create the best version of yourself.”  I literally could see a giant lightbulb turn on above his head because it turned on above mine too. That was the first time those words ever came out of my mouth, so it was just as much of an epiphany for me as it was for him.

As a marketer, I love nothing more than to parade success stories in front of our agent partners or prospective partnerships.  “Hey, look at this guy or gal, they used our program, and look what happened!” The truth is that many times that is what people want to see. We want to see that someone else achieved what we are trying to achieve.  It gives us hope but it can also be very discouraging when we try to “copy” someone and things don’t work out.  I think this discouragement typically comes from trying to be someone else instead of doing what they do.

I was listening to a Warren Buffet video yesterday where he told an Ivy league graduate class, “If you have an IQ of 160, find a way to sell 30 points of that.  You won’t need it.”  He then went on to say that investing is about rules, discipline, and temperament, not about intelligence or something unique to any individual.  In other words, he was saying that what he does is duplicatable if you have the same proven process, follow that process, and have the temperament to be patient with the process.

Some of you annuity wizards have personalities that I would literally write a million-dollar check for, but the reality is I couldn’t buy your personality if you gave it to me for free.  I think a lot of us feel that way.  I wish I was just as charismatic as some of you.  People are always telling me I should smile in my pictures which makes me want to smile even less.  I am terrible at starting a conversation from scratch, especially with someone that I can’t find common ground.  Sometimes, I just don’t even want to be around people and the last thing I want to do is sell someone on something they don’t want to buy.

Can you relate?

What is a personality dud like me supposed to do? 

In my early 20’s I went to a conference with a bunch of successful people presenting.  One of the presenters talked about how important it is to be enthusiastic.  After he spoke, I approached him in the lobby and told him I am not an enthusiastic person and I feel helpless trying to duplicate what he talked about.  He told me something I have never forgotten, “Talk louder and faster, it’s the same thing as enthusiasm”.  That is when I first learned that I didn’t have to have a personality of “being enthusiastic”, but I could have a process of “being enthusiastic”.  I learned that I could duplicate a process instead of a personality.  That process, over time, has become part of my habitual personality.  For the most part, I talk louder and faster anytime I am in a sales environment.   It is not in my nature, but it has become a habit.

The next time you find an example of success, put aside the personality and take note of what they do.  What daily habits do they have that you can duplicate?  What is the step-by-step process they use with a client?  What activity do they do on a daily basis to turn the process into a habit?

  • Write the process down
  • Organize it
  • Memorize it
  • Define it
  • Test it
  • Revise it
  • Give it time for the process to become a habit
  • Give it time for the process to become productive
  • Don’t quit!

The best thing about focusing on the process is you can start duplicating it today while duplicating a personality could take a lifetime.  When you duplicate the process, you will find your personality.  Success will breathe confidence and confidence will turn you into the best version of yourself.  Just remember to stay humble in the process!

Ready to get started on the process? Learn more here.

Annuity Agents Alliance Jed Award

November 5th, 2021 by

In honor of William “Jed” Mayfield, a long-time partner, we give away an award to one agent per year that exemplifies integrity, honesty, and always working in the best interest of their clients. We are proud to select Al Martinez for this year’s award. Watch the video here.

What are the numbers for success?

October 29th, 2021 by

I was just having a conversation with a business partner talking about how much activity is required to hit appointment and conversion goals. So, how much is enough?

I don’t know what the math for each partner would be, but what I do know is that it has to be enough.

I was watching a keto fitness expert on Joe Rogan a couple of years ago and Joe asked him something to the effect of, “What is the most someone can eat on a keto diet and not gain weight?”. In response to that question, the guest said, “You are asking the wrong question”. He then went on to explain that in his diet plan he tries to find the least amount he can eat while providing adequate nourishment for his body and avoiding the permanent stress of hunger. In other words, he was not trying to get away with something as a lifestyle, but rather he was erring on the side of overachievement to achieve a formula for success.

The reason why we ask “how much do I need to do…” is often motivated by trying to find the minimal amount of effort to accomplish our goals.

Instead, why err on the side of too much? We need to create that formula of success of having too many leads, too many calls, too many appointments, too much fact-finding, too much problem selling, too much solution selling, and too many annuity applications. Wouldn’t it be easier to find out how much is enough if you overshoot your target goals?

If you try to do the minimal approach to success, it will be pretty much a guarantee that you will miss your mark.

Learn more about Annuity Agents Alliance here.

How to handle the potential of inflation and the 5 steps to be successful in investing

October 14th, 2021 by

Listen to this video by Rick Rule, one of the best I have watched, about how to handle the potential of inflation and the 5 steps to be successful in investing.

Now, you might wonder why I’m talking about investing outside of the realm of annuities. No man lives on an island. Everything needs to work together. An income floor is what allows you to take advantage of investment opportunities that also have catastrophic risks. A great line to use with your clients by the way. Also important, your success as an annuity business owner is dependent on your allocation of capital. If you spend everything you make on things that don’t provide returns, then I would feel responsible for that if I didn’t encourage the oppositive behavior.

My favorite line other than the 5 steps he goes over towards the end of the video, is that saving money is an option’s premium on future investments. This is a genius viewpoint that I think the vast majority of investors don’t have a clue about. Most people are fully invested all the time and never have the liquidity to take advantage of investments below their intrinsic value when everything is crashing.

Also, think of this in light of our typical client that is completely dependent on their savings. Laddered income designs that attack inflation to the greatest extent possible have to be part of our planning process whenever our clients give us the resources available to mitigate that problem.

One final note is that there are some deflationary indicators over the long run that might counterbalance inflation according to many top economists, but there will be higher inflation in the short term for sure.

Interested in learning more? Request information here.

The 4 Stages of Marketing Budgets

September 28th, 2021 by

  • One way to start: Spend enough to create some momentum.
  • The author says a mid-range goal is generating 20% more leads than you can actually handle.
  • His view: Success means generating enough prospects that you can choose which ones to work with.

How much should you be investing in your marketing? I have agent partners that spend anywhere from $1,000 per month to over $20,000 per month.

How much you spend depends on a lot of factors including how much capital you have available to allocate and your sales process skill level to monetize from your marketing expenses.

For certain, the most difficult marketing decisions are in the early growth years of your business. Once established and capitalized, it is extremely difficult to out-expense your revenues. For over a decade I have been helping agents build highly successful businesses while getting through the challenges of allocating capital towards marketing. To help my agent partners in that endeavor, I developed a four-stage marketing budget process for growing a business.

Here are the four stages of marketing budgets:

Stage 1 — Monthly Budget

A budget that you are committed to that consistently increases to Stage 2. The key to this stage is to spend enough to create momentum and never retreating. An on-again-off-again marketing budget is a guaranteed way to stagnate your business. You must create a high frequency of opportunities to succeed or fail while intentionally focusing on improving your sales process.

Stage 2 — Calendar Budget

A calendar budget where you spend as much as required to fill your calendar with new appointments to the extent you want your calendar filled. In this stage, you will most likely need a minimum of two marketing systems working simultaneously to create a sustainable and consistent lead flow.

Stage 3 — Surplus Budget

A budget that supplies 20% to 30% more leads than you can fill your calendar with. At this point you most likely have three to four marketing systems going and you start being more selective on which prospects you want to work with to maximize the return on your time.

Stage 4 — Branding Budget

A budget that supplies more opportunity than you have time to process so you can guarantee a sustainable business that never has blank spots in your calendar, unless intentional. This stage allows you to be selective on which prospects you want to work with and allows you to support an agency with sub-agents. The sheer volume of marketing exposure at this stage creates a neon sign above your business that makes prospect conversion much easier than in the previous stages.

Reprinted with permission from the 2021 online edition of ThinkAdvisor © 2021 ALM Media Properties, LLC. All rights reserved. Further duplication without permission is prohibited. For information, contact 877-256-2472 or reprints@alm.com.

Educating Clients Is Not Your Job

May 6th, 2021 by

  • Knowledge is only useful if put into action.
  • Wisdom is what makes knowledge productive.
  • When a client agrees there is a problem, then present a solution.

I once had an agent partner tell me that he believed his job was to educate his clients. This was his response when I tried to coach him on the importance of having an effective sales process. He believed that if you just educated the client on products and options, they would act on that information.

He had his own “sales” process of educating clients he used for the last 20 years of his career with mediocre results but with enough success to pay the bills and make a decent living. He was coming to me because he wanted to improve his results. Isn’t it interesting how our human nature allows us to know what we need but not receive information that challenges our status quo?

Have you ever known someone smart and not so smart at the same time? That probably describes all of us somehow, but I am sure you have had experiences where you are trying to help someone, and they refuse to help themselves. Knowledge is only useful if put into action. Wisdom is the process of taking knowledge and applying action towards a worthwhile benefit. In other words, wisdom is what makes knowledge productive.

So, in that context, let me ask this question, “Is it wise to educate clients without any compulsion to influence their actions?”

Our best intentions lead us to educate our clients, but the problem is that education without action is a process with no conclusion. I have been in the insurance industry for around three decades, and every day I come to work I am learning something new. There is no end to financial education, not for us and not for our clients. How are we ever going to educate a client enough for them to make their own decisions? What cost are we willing to accept for that process to play out?

In my opinion, that cost is too high. I do not have unlimited time, and neither does the client.  Does that mean that a client should not gain knowledge through the sales process? Of course not! It is not if, but when and how much that matters.

Educating your clients on financial matters before you know how knowledge applies to their situation is like the tail wagging the dog. Your understanding of your clients, their problems, and how those problems need to be solved must come first. This is where you then present a solution to those problems. It is only when a client agrees there is a problem that a solution should be presented. Moreover, only when a client agrees to a numerical solution can education on how that solution was created should be explained. To make my point, education is the tail, not the dog, and the tail should never wag the dog.

Reprinted with permission from the 2021 online edition of ThinkAdvisor © 2021 ALM Media Properties, LLC. All rights reserved. Further duplication without permission is prohibited. For information, contact 877-256-2472 or reprints@alm.com.

What If My Prospect Takes My Information to Another Advisor?

March 18th, 2021 by

  • Prospects don’t owe you anything.
  • Some will walk away.
  • The key to keeping them may be to get to know them.

I cannot even count how many times over the years I have been asked this question — ”What if my prospect takes my information to another advisor?” — by the agents and advisors with whom I work. The most likely motive behind the question is a belief that once we provide information to the prospect, then that prospect owes us loyalty if they act on the information.

The premise of the question is a desire to withhold information from a prospective client because a competitor might use it if the prospect is not loyal to us.

It is a valid question and concern and a real-life problem we all face in this business, but the premise is exceptionally flawed. Rather than immediately answering this question, let me ask a question that is much more valid.

Why would a prospect owe us anything?

Making demands, literally or with motives only, starts our relationship with a prospect based on selfishness. Not only is that a terrible way to start a relationship but the prospect will see through our motives as clear as day. In the prospect’s eyes, it will come across as desperation and a lack of concern. No matter how hard we try and hide it, I guarantee you they will see right through us.

Getting someone to buy through a guilt trip is coercion, not sales.

Who has the most to lose, the advisor or the prospect? The money belongs to the prospect, not the advisor. It is their retirement, not ours, and the last thing they should be concerned about is our hurt feelings if they go with another advisor. They have everything to lose, and we only have our time and the cost of a lead, which is never as valuable as their retirement.

Why would any of us feel that our time and the cost of a lead are worth more than the prospect’s money?

A failure to compel is not the prospect’s fault; it is ours. Someone will service the prospect’s money, and the battle for that service is on us and the value proposition that we present.

For an advisor, as I wrote earlier, in The Rabbit Hole of Success, success in this business means helping people find solutions to their problems.

The prospect, of course, is under no obligation. We often say that in our marketing and disclosures, but do we mean it? Our job is to win the confidence of the prospect with the compelling purpose of money planning, and that all starts with a comprehensive fact finder. The advisor that gets the client to talk about their money and provide information that can expose problems that need to be solved is most likely to win the right to service the prospect.

Showing product before you have won the prospect’s confidence to receive comprehensive information that exposes problems is like waving a white flag of surrender.

The worst offense of the “guilt trip” sales process comes from product sellers.

Product sellers sell products, not solutions to problems, but somehow they may still feel like the prospect owes them something.

I find it astounding that an advisor can obligate the prospect because they spent time with them, ran an illustration, and handed out a brochure. Under no circumstance would that process obligate the prospect to move hundreds of thousands of dollars to any financial product. Not now, not ever.

Even if our process is based on fact-finding, problem finding, solution selling, and a comprehensive evaluation of a prospect’s financial situation, they still owe us nothing.

We are here to serve and to compel. If we serve and compel enough people, we win, and so will the prospects that become our clients.

Why is this the right way to approach the business?

Responsibility: This puts all the responsibility on us. If the prospect is not compelled, then we failed to compel. That puts the onus on us to become better compelling the prospect through a more effective case design and presentation rather than using the prospect as an excuse for our failure.

Good Mental Health: If our focus is on getting something every time we give something, not only will that never happen, but it will make us miserable. We should give unconditionally to the greatest extent possible.

There Is a Limit: Just because we are giving without the expectation of return does not mean we give perpetually. If we have something of value to offer, then we owe it to ourselves and the other prospects that need our help to move on. When do we move on? That is a judgment call. The more people we have waiting for our help, the less time we have to help people we have failed to compel.

This is the philosophy I have always used, which I believe has allowed me to succeed in this business and have fun in the process. Be a good steward of your time, but do not be selfish with your time by expecting that you will get something in return.

If we approach the financial planning business this way, we will not only enjoy it more, but we will also be more productive. Err on the side of giving “too much.” I promise it will make you feel good about what you do if you have the heart of a servant.

Reprinted with permission from the 2021 online edition of ThinkAdvisor © 2021 ALM Media Properties, LLC. All rights reserved. Further duplication without permission is prohibited. For information, contact 877-256-2472 or reprints@alm.com.