Overlooked asset gathering ideas

or Register to post new content in the forum

11 RepliesJump to last post

 

Comments

  • Allowed HTML tags: <em> <strong> <blockquote> <br> <p>

Plain text

  • No HTML tags allowed.
  • Web page addresses and e-mail addresses turn into links automatically.
  • Lines and paragraphs break automatically.
Aug 16, 2008 1:00 am

I have found myself going into hammer mode entirely too often in this forum, so I decided to put up a topic that could be helpful to a lot of people, and maybe I could learn something also.  So I'll start.

 
1.  When a client has a variable annuity with a death benefit significantly higher than the cash value, if it makes sense, and the withdrawals are dollar-for-dollar and the contract is out of surrender, do a partial withdrawal of all the cash except 1-2k to leave the death benefit in-tact.
 
2.  When talking with a client about their checking account, I generally ask, "What's the minimum amount you feel comfortable having in savings?"  and then ask, "What do you have in saving/checking now?"  then I have them write me a check for the difference.
 
3.  When recommending a muni bond to a new prospect, I phrase it as such, "If I can show you the equivalent of 7% on a taxable rate the next 10 years, what would stop you from sampling me out with 100k?"
 
4.  When a client has several statements from different brokerage firms, I'll suggest we "consolidate these funds/stocks so when a manager leaves, a fund underperforms, a stock gets downgraded, at least you have someone that will let you know about it."
 
5.  When working with a husband that runs his own show, but is getting older, I'll ask, "if something happens to you, who's going to help your wife with her investment portfolio?  Haven't you worked too hard building your net worth only to hand it over to your wife without any guidance?  Doesn't it make sense to start having a second set of eyes watching the portfolio with you so that if something happens to you at least you've got a back-up plan?"
 
6.  When rolling a TSP, the paperwork can be found on-line.  Print it out, have the client sign it and get it notorized and you are all set.
 
7.  On an annuity that has a significant allocation problem or has a significant surrender penalty, change the agent of record to bring those assets under your control.
 
8.  In wrap accounts that use individual bonds as part of their asset allocation, if it means bringing over the business, I'll tell the client to "turn off their monthly bill on the bond portion of the portfolio.  Rather than paying your advisor 20% of the yield of these bonds, lets set them aside and manage them separately.  I'll make my money as the bonds come due and I roll the money into new bonds, but you'll save that 1-1.5% annual charge."
 
Thought I'd through out a few ideas.........
Aug 18, 2008 9:13 am

Non-hardship 401K rollovers (if allowed).  This is big in my area due to certain employers that allow it.

Aug 18, 2008 9:52 am

The best idea that I have is to take a full factfinder instead of trying to sell a product.  The factfinder will let you know where all that money is so that one knows when they can use any of the hundreds of ideas.

 
1.  When a client has a variable annuity with a death benefit significantly higher than the cash value, if it makes sense, and the withdrawals are dollar-for-dollar and the contract is out of surrender, do a partial withdrawal of all the cash except 1-2k to leave the death benefit in-tact.
 
I'm not arguing with you, but I don't think that I've ever seen this situation.
Aug 18, 2008 10:25 am

Yeah, he lost me on that one about the VA...

Aug 18, 2008 10:48 am
anonymous:
1.  When a client has a variable annuity with a death benefit significantly higher than the cash value, if it makes sense, and the withdrawals are dollar-for-dollar and the contract is out of surrender, do a partial withdrawal of all the cash except 1-2k to leave the death benefit in-tact.
 
I'm not arguing with you, but I don't think that I've ever seen this situation.


I've seen - and done - exactly this once before.  Prospect had a boatload of old VAs, obviously well out of surrender, one of which had performed so poorly that the cash value was less than the DB.  Took a partial w/d, leaving just above the minimum required to maintain the contract, in order to preserve the DB (reduced dollar for dollar) which will be enough to cover last expenses at least.  Not a huge DB, but better than a kick in the head.

This is the only time I have personally seen this, but once was enough for this particular client.

Aug 18, 2008 11:12 am
anonymous:

The best idea that I have is to take a full factfinder instead of trying to sell a product.  The factfinder will let you know where all that money is so that one knows when they can use any of the hundreds of ideas.

 
1.  When a client has a variable annuity with a death benefit significantly higher than the cash value, if it makes sense, and the withdrawals are dollar-for-dollar and the contract is out of surrender, do a partial withdrawal of all the cash except 1-2k to leave the death benefit in-tact.
 
I'm not arguing with you, but I don't think that I've ever seen this situation.



I have and I've done it. Mostly with older annuities before they figured out how to reduce things pro rata.

Aug 18, 2008 11:14 am
Morphius:
anonymous:
1.  When a client has a variable annuity with a death benefit significantly higher than the cash value, if it makes sense, and the withdrawals are dollar-for-dollar and the contract is out of surrender, do a partial withdrawal of all the cash except 1-2k to leave the death benefit in-tact.
 
I'm not arguing with you, but I don't think that I've ever seen this situation.


I've seen - and done - exactly this once before.  Prospect had a boatload of old VAs, obviously well out of surrender, one of which had performed so poorly that the cash value was less than the DB.  Took a partial w/d, leaving just above the minimum required to maintain the contract, in order to preserve the DB (reduced dollar for dollar) which will be enough to cover last expenses at least.  Not a huge DB, but better than a kick in the head.

This is the only time I have personally seen this, but once was enough for this particular client.



If memory serves me right, the best one that I did left the client with an $80,000 death benifit and a $2,500 contract value. I left it in the fixed bucket so that it would never drop below $2,000.

Aug 18, 2008 1:26 pm
VA Salesman:
anonymous:

The best idea that I have is to take a full factfinder instead of trying to sell a product.  The factfinder will let you know where all that money is so that one knows when they can use any of the hundreds of ideas.

 
1.  When a client has a variable annuity with a death benefit significantly higher than the cash value, if it makes sense, and the withdrawals are dollar-for-dollar and the contract is out of surrender, do a partial withdrawal of all the cash except 1-2k to leave the death benefit in-tact.
 
I'm not arguing with you, but I don't think that I've ever seen this situation.



I have and I've done it. Mostly with older annuities before they figured out how to reduce things pro rata.

 
+1
Aug 18, 2008 2:04 pm
Primo:
VA Salesman:
anonymous:

The best idea that I have is to take a full factfinder instead of trying to sell a product.  The factfinder will let you know where all that money is so that one knows when they can use any of the hundreds of ideas.

 
1.  When a client has a variable annuity with a death benefit significantly higher than the cash value, if it makes sense, and the withdrawals are dollar-for-dollar and the contract is out of surrender, do a partial withdrawal of all the cash except 1-2k to leave the death benefit in-tact.
 
I'm not arguing with you, but I don't think that I've ever seen this situation.



I have and I've done it. Mostly with older annuities before they figured out how to reduce things pro rata.

 
+1




I love you, too.

Aug 18, 2008 4:11 pm
 
1.  When a client has a variable annuity with a death benefit significantly higher than the cash value, if it makes sense, and the withdrawals are dollar-for-dollar and the contract is out of surrender, do a partial withdrawal of all the cash except 1-2k to leave the death benefit in-tact.
 
I'm not arguing with you, but I don't think that I've ever seen this situation.[/quote]
 
Hartford made this mistake a couple of years ago. We drained everyone of those darn contracts and haven't regretted it for a minute (nor have our clients). Many of our clients who were in these things have contract values of 2-3k and death benefits of  100k+ with others in the 50k-90k range. They've just been sitting there for a few years while we've been doing bigger and better things with the rest...
Aug 18, 2008 8:05 pm

The VA 1035 thing worked well for some of the older brokers in 2002 and 2003 when values were down and they had old non-surrender charge contracts.  The problem was that you had to make sure the insurance company would allow partials, and still maintain deathe benefits. Many companies are not allowing this now. The trend for insurance companies is to make it very difficult to 1035 on the new contracts especially with living benefit riders. One of the veteren brokers with when I was with Jones was given huge accolades for his best year ever(750,000 gross)

and almost all of his above normal business was 1035 exchanges.