The New York State Department of Financial Services (NYDFS) best-interest Regulation 187 (NY 187) is effective February 1, 2020 for life insurance transactions, and August 1, 2019 for annuity transactions within the state of New York.
Clients fall into the psychological traps of investing all the time. They stick to old ideas and protect earlier choices, even those that aren’t financially beneficial. They follow the herd mentality, investing in the latest, hottest product without concern for how it may fit into their broader financial plan. Or they may hold as truth the advice of a friend or family member whose financial goals don’t match their own.
On December 20, 2019, President Trump signed the Setting Every Community Up for Retirement Enhancement Act (SECURE Act). The new law has the laudable goal of expanding opportunities for individual retirement savings. However, several key changes made by the SECURE Act may affect your clients’ retirement and legacy plans, requiring possible reconsideration and adjustments.
How much money could you make if you had a steady stream of quality leads and referrals? We’ve all asked ourselves that same question. The reality is that 20% of all agents generate 80% of all commissions. And the top 20% of those high-performing agents generate 80% of the commissions in that group. What separates that top 4% from the rest of the field? They spend the vast majority of their time working at their maximum-income tasks. For most of us, that means face-to-face selling situations with a client.
I never cease to be amazed at the way some advisors obsess over every change made by a vendor: “The sky is falling, the sky is falling!” Translation: rates or benefits are changing. Your client doesn’t care, because clients buy solutions, not features.
Why a FLP Strategy in 2020 Could Benefit Your High-Net-Worth Clients Harry met Wilma and started a family. Now, they’re looking for a valuable wealth preservation or asset protection instrument for their $100 million estate. Family Limited Partnerships (FLPs) have been and continue to be one of the most powerful tools in an estate planner’s toolbox due to the ability to significantly discount the value of gifts made from parents to the next generation(s). Utilizing the doubled lifetime exemption afforded by the Tax Cuts and Jobs Act ($11.4 million/single, $22.8 million/married), a parent may be able to use a FLP strategy to gift heirs more assets from their estate than what they’d otherwise be able to directly gift, while also maintaining some control over those same assets.
HighCap Financial is always proud of the integrity, generosity, and consideration that our advisors exhibit not only with their clients, but with their communities. A prime example is Erv Woller who, along with his partner Bob Anger, have funded the Heins Woller-Anger Scholarship for 30 years through the University of Wisconsin-Madison’s (UW-Madison) School of Business. The goal of the scholarship is to not only promote the industry by providing financial assistance to select students in the Risk and Insurance Department, but also to honor the late Richard Heins, a former UW-Madison Risk Management professor whose passion for risk management was infectious.
During this holiday season, many of us consider making charitable donations to a favorite cause or institution. In fact, according to the Giving USA Foundation’s annual report, American individuals gave $292 billion to charity in 2018.1 Many of the donations were large gifts as opposed to a few dollars here or there. If you’re considering making a significant gift, keep in mind these three strategies that could help both you and your charity of choice.
Transition is tough. Nobody leaves a broker/dealer (BD) they’re happy with. In fact, the pain you’re experiencing with your current BD has to exceed the pain of moving on, especially since the old days of “block” transfers are long gone. Today’s transitions are like going through a divorce and remarriage in 30 days with 300 children, but at some point, you may realize it’s worth it. Here are 10 things to consider before notifying your current BD of your intent to move on.
When positioning life insurance from a perspective of potential cash value build-up, there are various product types to consider, each with its own straightforward, distinguishing features. For aggressive risk profiles, variable life products—which may be fully exposed to the ups and downs of the market—may be appropriate. On the other end of the spectrum, fixed universal or whole life contracts with guarantees may be more suitable for a risk-averse client.
Long-term care (LTC) is probably one of the most important and perhaps sensitive discussions you can have with your clients. There are so many variables—your client’s actual vs. estimated longevity, current vs. future health, current vs. future lifestyle—each of which change the equation. But it’s also the emotion that’s attached to the discussion; every one of your clients knows they will eventually pass away, but thinking about how, when, and in what way always brings some consternation and even avoidance.
Why would you recommend that clients with millions of dollars in invested assets spend money on a long-term care plan? Because it helps remove the risk from their portfolio. With affluent clients, it’s not whether they can afford to pay for potential long-term care needs. But is it an expense they want to incur at an unpredictable time in their lives?
Nancy suggests adding long-term care planning to your agenda with clients at their annual review or financial analysis. She knows they will be relieved that you have addressed the topic. When clients are open to it, arrange a conference call and introduce Nancy as a member of your team.
One reason your clients trust you with their assets is your recommendations help them sleep at night. Whether the market is up or down, your advice provides peace of mind that clients count on. It’s time to put that calming effect to work on the topic of long-term care. You owe it to your clients to talk about incorporating Longevity Planning in their financial plans. Breakthroughs in medicine, technology and public health have led to longer life expectancies. Your clients can look forward to many years ahead.
In your client meetings, which spouse has more influence on decisions? Perhaps you have noticed women are taking an increasingly larger role when couples implement your recommendations.
Michael Tanaka has been a serial tech entrepreneur since graduating in 2004 with master’s degrees in mathematics and computer science. In 2012, Michael created Tanaka, Inc., a technology startup focused on creating sophisticated algorithms that had the potential to revolutionize the quality control systems for major industrial manufacturing companies.
Clients rely on your expertise and recommendations when it comes to protecting assets and planning for their future. In many cases, your guidance is essential to their peace of mind. That’s especially true with decisions about long-term care insurance. In fact, 90 percent of consumers surveyed agree their financial advisors should discuss LTC plans with them.
I am often asked by new and old agents alike, “What does it take to become really successful in this business?” What I’ve learned over the years is that there is no one thing that, like a magic pill, will guarantee success. Instead, there are three key things that, when applied consistently, can keep you on track for success and help you avoid failure.
The SWAT Underwriting team at Highland is respected in the industry. Carriers know this team “plays fair” with their case requests and this engenders trust. When a borderline case arises, the carrier will give more consideration to the SWAT team. This is much like basic human nature — people will work harder to find a solution for you when they trust you. In the case study below, learn how this diabetic client benefited from the seasoned SWAT Underwriting team.