One of the most common risks in retirement is order of returns risk (also known as: sequence of returns risk). It is well known within the financial services industry that investing in marketable securities exposes clients to this risk. However, do your clients know that many indexed products are not immune from order of returns risk?
To no surprise of anyone in our business, financial professionals often express to me their frustrations with the life insurance underwriting process. When I consult with them, I find myself asking the same important questions:
How well do you think you know your clients? What about their complete financial profile? If you have been in the industry for a while you may believe you know everything. However, most financial professionals who confidently tell me this are kidding themselves. Why can I confidently say this?
What does it take to get a saver to move their money? Apparently not that much. According to an insurance company representative, they are writing new business hand over fist because their company offers the highest guaranteed fixed rate of interest for a specific number of years within a deferred annuity.
In the past, financial professionals have relied on a well-balanced portfolio of stocks and bonds to manage a client’s risk versus return. While the concept is widely accepted, if you ask 50 different financial professionals what a well-balanced portfolio of stocks and bonds looks like, you'll likely get 50 different answers.
There are various products out there that provide your clients with retirement income, and many of the traditional options such as a 401(k), IRA or Roth account come to mind. What many of your clients may not realize is that a properly structured and funded Indexed Universal Life (IUL) policy can provide your clients more benefits with less risk than the traditional options.
As an independent financial professional and a small business owner, you must leverage every minute you have and every dollar you spend to maximize your efficiency and profitability. One of the best ways to gain resources is to partner with the right IMO (Independent Marketing Organization) that has a skilled staff designed to support your business.
One of the most engaging topics that I cover in my Social Security education class is the impact of taxes. Most attendees at my workshops don't know that their Social Security benefits may be subject to tax. Of those few who do know, many are unsure as to how it is determined, and how much tax they are likely to pay.
The "Amazon Effect" is essentially the results of how a digital world has changed business models regarding consumer expectations, interaction, choices, and options. This phenomenon started back in 1994. Since that time, it has changed society as well as many business models in various industries and markets.
Even when your clients have significant retirement resources, it is important to create a comprehensive strategy specifically for them. If you do not do your best to help each unique client, you risk your client's future as well as your own.
FOR PRODUCER USE ONLY. NOT FOR USE WITH CLIENTS.
This content is for informational and educational purposes only and is not designed, or intended, to be applicable to any person's individual circumstances. It should not be considered as investment advice, nor does it constitute a recommendation that anyone engage in (or refrain from) a particular course of action.