Does This Ever Happen to You?

By Kevin Kusleika, President

You’ve spent the money and the time and the effort to attract a new prospect to discuss the greatest annuity product ever created.  They’re obviously interested in the annuity information they found on your website since they took the time not only to do the research, but to also fill out the form requesting an appointment.  Of course, this one’s no problem; a done deal, and in your head you’ve already spent the commission.

During the meeting, you find out it’s even better than you initially thought!  Your very-educated client has $1.5M in an old 401(k) and has already made the decision, based upon their own research, that they want at least $500k growing in an annuity for 5-7 years to generate lifetime income.  Now, that commission you had already spent turns into a Hawaiian vacation, too!  It’s time to write the application and then call your wife with the good news!

Of course, you’re a highly qualified and ethical agent with all the product and sales knowledge you need to close this quickly!  And, it’s your job to make sure the transaction is suitable and the client understands income riders, guarantees, fees, index strategies, surrender charges, tax-deferred growth, etc.  You cover all the details.  You do what you’re supposed to do as his agent.  You have the forms prepared and ready to sign.  And then…he says “This has gone so smoothly that I’d also like to move the rest of my 401(k) to a brokerage account for you to manage as well.”  Uh oh.  Now what???  Last time you checked, you didn’t hold the necessary license to tell your client to liquidate part of his 401(k) to move to an annuity in the first place.  Fortunately he told you what he wanted to do, but now your only answer is “I can’t do that for you.  You’ll have to speak with a broker or investment adviser.”  He says “I was really hoping I could work with just one individual”, which by the way, a recent survey said that 91% of those interviewed also wanted.  He says “Let me schedule another appointment with you in about a week.  I just want to talk this over with my wife one more time.”  You know that means.  You’re not going to see him again.  He’s going to find the “one adviser” than can handle all of it for him.  And, that one adviser is not only going to make the annuity sale and the commission, but he’s probably going to have an asset fee the he collects each year on top of it.

That situation had personally happened to me several times several years ago.  When you can only play on one side of the fence, you’ll ultimately find out you that you have to walk away from too many opportunities.  Adding a Series 65 (Investment Adviser Representative) to your licensing will allow you to be the “one adviser”.  I experienced that as well in recent years; the difference is dramatic.  You’re not only able to do everything for your clients, but you’re also a fiduciary.  That’s a big deal!

If you’d like to avoid the situation above, it may be time for the Series 65 solution, the fiduciary role, increased opportunities with your clients and recurring revenue.  And, if you’re already a fiduciary, we think Brookstone Capital Management (our strategic RIA partner) can make a tremendous difference in your future.  I have seen it myself as one of their advisers and can personally recommend them from experience.

Learn more from Dean Zayed, Founder and CEO of Brookstone Capital Management: View Presentation

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Posted in Annuities, AUM, Brookstone Capital Management, RIA.