Knowledge is power. So I created this video to show you the power of understanding your clients’ goals and objectives vs. chasing the shiny object (which your less successful competitors are doing now).

Watch this video to see how easily you can provide your clients—who are REQUIRED to take their RMDs—65% more benefits using our proven annuity strategy. And by proven, I’m talking $1 billion in annual annuity premium.

This is a best of both worlds scenario…the solution may be best for your client AND best for growing your business. I’m in this video, so watch it and email me your reaction.

Risky Income vs. Income for Life

When you meet with clients, they may have heard of the Monte Carlo method of determining retirement withdrawals, customarily 4%.

By using this method, a new CBSMoneywatch.com article (link below) says, “the odds are very low that you’ll outlive your retirement savings for periods of retirement that are up to 30 years long.”

Notice, in true casino fashion, they are using the word odds. Because, unlike with insurance products that offer guarantees, on the securities side of the fence nothing is guaranteed.

But now a report suggests that a 4% withdrawal rate may be too high.

That’s right. Retirees could be told to reduce their withdrawals even further or risk outliving their retirement savings.

Why? Because market volatility is reducing their principal, so staying at today’s rates could see them burn through their safety nets even faster.

I do not have a crystal ball, but it doesn’t look to me like market volatility is going anywhere but up, then down, then up. See what I mean?

Do your clients want a “reliable” return or a “guaranteed” return in their retirement years? This article may help you in your client conversations on probable returns (possibly outliving income) vs. guaranteed returns (never outliving income).

Read it here…

I came across this fascinating post that takes the Federal Budget and puts it in terms of a household budget…using numbers we can actually comprehend. It’s written by David S. Thomas Jr., Chief Executive Officer of Equitas Capital Advisors LLC. Follow the link at the end of the excerpt to read the whole post.

This could help you when talking with your clients about how, in light of current economic conditions, fixed index annuities may be the right solution to their retirement planning needs.

The U.S. Congress sets a federal budget every year in the trillions of dollars. Few people know how much money that is so we created a breakdown of federal spending in simple terms. Let’s put the 2011 federal budget into perspective:

U.S. income: $2,170,000,000,000
Federal budget: $3,820,000,000,000
New debt: $ 1,650,000,000,000
National debt: $14,271,000,000,000
Recent budget cut: $ 38,500,000,000 (about 1 percent of the budget)

It helps to think about these numbers in terms that we can relate to. Let’s remove eight zeros from these numbers and pretend this is the household budget for the fictitious Jones family.

Total annual income for the Jones family: $21,700
Amount of money the Jones family spent: $38,200
Amount of new debt added to the credit card: $16,500
Outstanding balance on the credit card: $142,710
Amount cut from the budget: $385

So in effect last month Congress, or in this example the Jones family, sat down at the kitchen table and agreed to cut $385 from its annual budget. What family would cut $385 of spending in order to solve $16,500 in deficit spending?

It is a start, although hardly a solution. Read more…

I’m pleased to share this guest post from Marc Montini, Shurwest’s Chief Marketing Officer.

The NAIC recently announced plans to add tighter regulations on illustrations used for the sale of fixed index annuities. 

Marc Montini

While we usually recoil at more regulation, in this case it’s a welcome move.  Misleading illustrations damage the credibility of our entire industry. And if we live by the highest standard, we want everyone else to, too.

At Shurwest, we see a number of issues with our competitors’ illustrations on a daily basis.  Most insurance companies don’t provide software to illustrate their products. That leaves it to the IMO, or even the agent, to create their own method of illustration.

Many of these illustrations are outright wrong. They’re typically based on outdated crediting structure. I recently saw an American insurance company’s approved handout that showed a 12-year performance, yet clearly stated that the product and crediting structure is no longer available.  How can an insurance company solicit the sale of an annuity using data that looks nothing like the product and crediting structure that is actually being sold?  Misrepresentations like this ignite additional regulation and could potentially reignite 151-A.

Fees are another feature often misrepresented. Income riders have fees. Often those fees will erode principle if the index is negative. (Don’t worry, BAA and BPA fees never erode principle—no gain/no pain.) Yet you will never see that on most illustrations. They’ll show the original premium staying level and the income value compounding when, in reality, their product works much differently. There is either a gain or there isn’t a gain.  If there’s no gain, that original premium should be shown to decrease compensate for the fees or it’s a misrepresentation (unless of course you are selling one of our products where this is never an issue).

The moral of the story is to be careful.  Just because your client sees something in print, it doesn’t mean it’s legitimate.  It’s your name on the application, and you’re the one they’re going after if there’s a problem.  Call your Shurwest Marketing Consultant if you are uncertain about the illustration another IMO has sent to you. You know we’ll be honest with you and will point out anything that may be misleading…and could lead to you getting a call from the state.

As always, thanks for your commitment to operating at the highest ethical level. That’s why we have a successful partnership and will continue to, despite how others in our industry may operate.

If you are a top producer, you’re probably feeling pretty good about your rapport with clients. You know what your retirement planning clients want and you are successful because you provide it to them.

But what if you were wrong?

What if you assumed your retirement planning clients wanted income when what they really wanted was an effective way to pass their nest egg to their heirs?

Couldn’t happen to you? Well hold on, because a new study suggests many advisors are unaware of their clients’ true motivation.

Here are the eye-opening statistics from a recent article in Financial Planning magazine (link below): 80% of affluent clients surveyed reported that their primary concern was ensuring their heirs are taken care of. However, only 40% of advisors believed this was their client’s primary concern. To me, that’s a sobering disconnect–a huge gap between what an advisor believes and reality.

This knowledge gap could be costing advisors larger cases and referrals, and may even be costing them clients who feel dissatisfied and take their business elsewhere.

So what can advisors do so they don’t fall into this info-gap trap?

My top advisors use education as their focal point when meeting with new clients and reconnecting with old clients. It’s a powerful approach that puts them in a neutral, non-sales position and relaxes all those clients who “don’t want to be sold to.”

And what’s the million-dollar question they ask their clients? It’s so simple it will surprise you: “What are your goals and objectives?” Why go in with an income play when wealth transfer is their greatest concern? Or vice versa.

If you ask this question early in your relationship with your client, and then periodically throughout their lifetime, you show your commitment to finding solutions for their needs and you open the door to new business.

Let’s hope that none of you fall into that 40% of misguided advisors. Knowing that this potential trap is out there, hopefully now you can avoid it.

The most successful advisors in the world understand and know their clients. Are their goals and objetives income? Wealth transfer? Accumulation? Only your clients know the answer. Don’t let shiny marketing methods lead you down the path.

Think of yourself as a doctor when talking with your clients. Interview them to gather all their “symptoms” before you write your prescription. They will thank you for it. And, ideally through referrals, their friends and family will, too.

Link to Financial Planning Magazine article

I just watched a video interview with Jack Marrion, one of the most respected voices in our industry. Marrion is discussing his new book..”Index Annuities…A Suitable Approach.”

The book explains index annuity concepts and crediting methods with more easy-to-understand graphics, and compares index annuities with other financial vehicles.

If you’re looking for good advice on staying straight with regulators, actual case studies to help the annuity producer stay compliant and how securities registration affects suitability, this book would be a good guide.

If Marrion’s name isn’t familiar to you, he is president of a research consultancy that publishes the Index Compendium newsletter, the consumer education materials of Safe Money Places and the Advantage Compendium research studies. He is frequently referenced by regulators and in SEC rule filings relating to annuities, as well as appearing as an expert witness. His first index annuity book Index Annuities – Power & Protection is regarded as the ultimate text on index annuities.

To check out the interview, click here.

This week of all weeks, when we’re hustling to get ready to host friends and family and still get all our work done, I’m reminded of just how lucky everyone in our industry is.

While we have to deal with constantly evolving high points and low points, do we take the time to remember how much better we have it than 95% of our neighbors?

This came to mind when one of my top producers called from his fishing boat. He has built the kind of portable career that lets him work in his (home) office when he needs to—and affords him the luxury of phoning it in while fishing, pursuing one of his life’s passions on his own schedule, not on an employer’s calendar.

Christina and I enjoying our lives because of you.

So when we go through a challenging economic period that brings product changes , our first inclination might be “woe is me.” But is woe really you? Or are you the agent or advisor who gets to decide when and where you work? Who you work with? And how much time you get to take for family and the other things you love?

It’s true that you get to the top by working hard. But once you’re there (or well on your way!) you are truly the master of your universe, creating a lifestyle that many would envy.

I am thankful that I work at Shurwest, where I essentially run my own show, aided by an organization that does everything possible to help me help my advisors.

But mostly I am thankful for you. Because of your focus on serving your clients well, you have built an amazing business—a business I am proud to contribute my expertise and experience to.

I look forward to partnering with you in the New Year to find new ways to help your clients with strategies that preserve their wealth, build their income and make it possible for them to leave a fitting legacy.

To make their life’s work a true work of heart.

Happy Thanksgiving from my family to yours!

I’m pleased to bring you this guest post from Marc Montini, Shurwest’s Chief Marketing Officer:

Don’t look now, but the holiday season is here. For some advisors, that’s not good news.  How many times have you heard, “Sounds good, but let’s wait until after the holidays.” Consequently, some advisors decide to go into hibernation, ready to emerge from their caves early in the New Year.

Marc Montini

But what if you looked at the holidays differently? Is there a hidden sales opportunity you’re missing?

During the holidays, clients are in a “family” mindset. What better time to make sure all their assets are in order and to confirm wealth transfer occurs the way they intend? Getting clients to make significant financial decisions, including the purchase of a fixed index annuity, in the coming months may be a challenge. But advisors can still provide a vital service to their clients and get referrals in the process.

Most of our advisors focus on retirement income planning, 401k rollovers and even Roth conversions. But many neglect one of the easiest method of estate planning: the Beneficiary Review. Taking time to conduct a year-end review of clients’ current assets and spell out for them who will be getting what—according to their current documents—can make you a hero. Especially if you uncover a mistake they knew nothing about.

You’d be amazed at the volume of fixed index annuity applications that come through our doors with incorrect or incomplete beneficiary designations. Annuities are one of the most efficient wealth transfer vehicles available.  What a waste to send an annuity through probate simply because the beneficiary designations were set up incorrectly.

The ramifications can be even worse for stretch IRAs and 401k rollovers.  Call our in-house CPA, Joe Arsenault, to learn more.

How can conducting beneficiary reviews benefit you?

• Additional Deposit-A client can’t do a comprehensive beneficiary review on just the annuity you sold them. To do it right, you’ll need access to their other financial assets as well.
• Referrals-A client who does a review on their assets will easily recommend the same free and painless service to their brother, sister, best friend, etc.  The possibilities for referrals are endless.

What can we at Shurwest do to help you?

1.       Shurwest will provide a beneficiary review kit featuring the important questions to ask.

2.       You will get a “cheat sheet” to gain a better understanding of why you need to ask certain questions.

3.       Participate in our brief Beneficiary Review webinar. The date will be announced right here soon (so be sure to subscribe to Carter’s blog if you haven’t already).

4.       Shurwest will provide you a compliance-approved client advertisement and approach letter.

5.       Complete access to our in-house CPA, Joe Arsenault to ensure all your questions are answered so you can conduct reviews with confidence.

An advisor once told me he loved the holidays. When I asked him why, he said, “Because there is NO competition!”

A strong November and December is a great way to jump start 2011! Shurwest can help you make it happen.

As I was watching Groundhog Day−one of my favorite movies−last weekend, it struck me that we could all learn a lot…and attract more business…by being more like Bill Murray’s character.

Quick movie recap: Murray plays TV meteorologist Phil Connors, a jaded guy sent to cover the annual Groundhog Day festivities with Punxsutawney Phil. He quickly spies townie Andie McDowell (Rita) and would like for sparks to fly, but she’s not impressed by his false charm. Cut to the heart of the story: Post surprise blizzard, Phil winds up reliving February 2^nd over and over again. At first he uses his insider knowledge of what’s to come (before the next 24-hour reset) to take advantage of everyone.

Eventually he becomes bored and wants it all to end. Rita suggests he use the time to improve himself. Little by little he starts doing things for other people, even saving lives and, eventually, making inroads with Rita. His final report on Groundhog Day warms everyone’s heart, especially Rita’s.

If you’re thinking, “Carter, you’ve gone off the deep end on this blog post,” hear me out.

We all spend a lot of time wondering how we are going to get ahead. But have you ever noticed that when you spend time helping someone else, without expecting reward, rewards of one kind or another find their way to you?

The same hand that gives is well-positioned to receive.

My goal is to help my advisors in any way I can (except by throwing a golf game to boost their self esteem. Read my earlier post on that here). Whether it’s finding a new way to help you close a case or attract new clients, I will jump at the chance to do it. Maybe it’s selfishness because I know that helping you will eventually help me.

But isn’t that the way successful advisors like you look at your clients? “How can I help this client get the most benefits for their buck?” And think of all the things you do for your clients that may not return immediate results. But they build trust, trust that gives your clients the confidence to continue to do business with you…and to send you referrals.

I’m thinking about more ways I can help you, just as you’re thinking of more ways you can help your clients. My phone line is always open, so if there’s something I can do for you, please give me a call.

Carter, here. I am pleased to welcome my first guest post from Chris Price, Shurwest’s director of broker-dealer relations. Holding just about every securities license known, Chris has a deep knowledge of securities and insurance products.

Guest Blogger Chris Price

His insight is invaluable to Shurwest and to our advisors. If you want Chris’ input on a securities-related case, call me and I’ll get him on the line. And now, from Chris Price:

When it’s stormy outside, we humans naturally seek a cozy cave to hide out in for protection. That’s what we do with our money, too. Bonds have been a traditional “cave” for retirees’ “safe money”—especially for those who believe they only have three choices when allocating their nest egg: cash, stocks or bonds.

But how safe is that cave? Could rocks start falling from the ceiling? Financial analysts warning of a bond bubble on the verge of bursting think so.

Type “bond bubble” into your web browser and you’ll get 275,000 hits on the subject, from such sources as Forbes and MSNBC.

The reason it’s such a hot topic is the assumption that people flee to bonds for safety purposes. But, of course, bonds are interest-rate sensitive and interest rates are about as low as they can really go. Assuming interest rates rise, that “safety play” has now, potentially, cost that client money. There is no upside potential from bonds if interest rates are going up. But, your equity position is going down because of the unstable environment. Essentially you are cutting off your nose to spite your face.

Indexed annuities are an alternative to bonds that not enough people know about. Our job is to educate people about them at every opportunity. Because, even though annuity pricing is affected by the bond climate, annuity guarantees remain a huge advantage.

Aren’t Insurance Companies Bond Investors?

“Would a bond bubble affect an insurance company that invests in bonds to back its annuities?”  Absolutely, large insurance companies are affected by bond interest rates. But their advantage can be summed up in two words: buying power. And for that matter, two more words: staying power.

Because of their enormous buying power, they purchase bonds at institutional pricing, which allows them to pay lower prices for bonds than the price an investor pays through a broker. Those deep discounts allow them to still reward annuity customers with benefits.

Clearly, we need to educate clients on the safety and guarantees, not rate of return. The most successful advisors do a little of both. In order to continue to be successful in today’s environment, we need to focus our conversations with retirees on safety and guarantees. We’ll get back to rate of return when the insurance companies benefit from rising interest rates.

Until then, remember that the need for safety is as old as that first caveman searching for shelter from the storm. It’s a powerful motivator…especially when utilizing a fixed indexed annuity as an alternative to individual issue bonds, bond funds and as part of an asset allocation mix.