Blogs

Month: March 2021

Planning for the Year 2025 Starts Today

Planning for the Year 2025 Starts Today

Wayne Gretzky was quoted as saying, “I tried to deliver the puck where the person is going to be versus where they are today.” It’s a good strategy for hockey, and it’s also very appropriate as you work to transform your business into a High Performing Practice.

Currently, before they retire, your clients are focused on accumulation. That could be through their 401(k), an IRA or assets under management.  But over the next five years, by 2025, 18 million Americans will have left the workplace and joined the ranks of the retired. Unfortunately, today the average retirement account balance is about $130,000 — definitely not enough to fund the type of retirement many of us are hoping for.

To further complicate preparing for a successful retirement, from a business standpoint, is the shortage of qualified advisors. Currently, there is one financial advisor for every 76 baby boomers. And in just five short years, there will be 163 baby boomers for every one financial professional.

This means that we’re going to have to generate more income for longer periods of time with the least amount of assets than ever before.

To do that, you need a new technique. You need resources and tools to adapt to this new world looming ever closer over the horizon. Instead of worrying about how to get started, take the first step today and reach out to our retirement income consultants. They can talk with you about the new and different approaches and tools that can help you evolve — such as our JourneyGuide software that can help you efficiently and effectively income plan as your clients shift from the accumulation phase to the income phase.

But our most important resource isn’t a tool, it’s a strategy. Our Income Alpha approach can help you increase income — something we know our clients aren’t generating enough of. We regularly see 20% increases in the amount of income we can deliver clients, along with an improved probability of success. In fact, we’re actually able to leverage protected income to free up some liquidity, allowing you to address other concerns such as leaving a legacy, transferring wealth or planning for a long-term care need.

So, take a few minutes. Give us a call at (800) 589-3000. Find out how JourneyGuide and Income Alpha can prepare you to thrive over the next five years and be ready for success in 2025.

Transformational Tactic

Find out where your revenue is going to come from by 2025 and how you can prepare now to become a High Performing Practice. Talk to your retirement income consultant today.

Recognize the opportunity to transform your business by taking our free course.

Posted by hpp
Maximize Your Clients’ Retirement Income

Maximize Your Clients’ Retirement Income

We’ve been talking the last several weeks about tax-deferred vehicles like annuities including protected income. You’ve also learned how to turn tax-deferred into tax-free when it comes to planning for long-term care. Today, I’m going to bring it all together.

It can seem like you’re being pulled in two different directions. On the one hand, you want to drive value in your business. On the other hand, you don’t want to conflict with your clients — you also want to provide value to them. What you need is a solution that enables you to do both in a safe scenario.

The approach is Income Alpha. It’s been the topic of this blog in the past, and it’s such a powerful tool that it’s worth bringing up again today.

Currently, there are many Americans out of work, creating a great opportunity to talk about how to get the maximum amount of income in retirement for our clients. How do we increase our probability of success? Income Alpha works by using only a little bit of protected income, allowing you to maximize your assets under management.

In many case scenarios, we were able to use the Alpha Income strategy to increase the client value in terms of income during retirement by as much as 21%. But at the same time, we increase that client’s lifetime value to you with assets under management. The power of the proper placement of protected income and the best use of tax-deferred vehicles work together to align your goals of adding value to both your business and your clients.

I encourage you to reach out to our retirement income consultants at (800) 589-3000 to learn more about how Income Alpha can speed up retirement, provide more income and, most importantly, offer your clients a higher probability of success.

Transformational Tactic

Finding a strategy that works for you and your clients is possible with Income Alpha. Find out more about how it can transform your business.

Recognize the opportunity to transform your business by taking our free course.

Posted by hpp
Shifting Tax-Deferred to Tax-Free

Shifting Tax-Deferred to Tax-Free

It’s no surprise, but when Americans are surveyed about retirement, one of the consistent results is the desire to avoid being a burden on their families. And as advisors, our job is to help them reach that goal. Not only can you keep them from burdening their families in the event of a long-term care need, but you can also help them save on taxes, all with one strategic move.

Many Americans have placed their money in conservative, tax-deferred annuities. Over the course of several years or even decades, these annuities have grown significantly. Now the problem is tax-deferred gains. If you take money out of the annuity, it is taxed as last-in-first-out, meaning the gain is taxed first. So, if your client experiences a long-term care event and you use the annuity for any type of home or facility care, your client is going to be taxed on the gain at ordinary income rates.

If your client is unable to perform two of the six activities of daily living, however, you can shift to an annuity that qualifies under the Pension Protection Act. The advantage of this is that not only is the cost basis returned tax-free, but the tax-deferred growth is also returned tax-free as are the long-term care benefits provided by the insurance carrier.

What you have done is shifted tax-deferred assets to tax-free distributions when your clients need it the most. This creates leverage because you’re not paying tax on those gains.

Only 11% of the population has actually shifted that long-term care expense to an insurance carrier. And it is one of the greatest multipliers of any type of failure that we see in retirement income planning. So, think about using some of those old fixed annuities to cover a long-term care need.

Our retirement income consultants can help you get started on the Annuity Audit process, so you can identify which annuities are no longer meeting your clients’ needs. Reach out at (800) 589-3000. We will be more than happy to show you our process and work with some of your clients.

Transformational Tactic

Help your clients plan for long-term care while converting tax-deferred assets into tax-free benefits in one simple move.

Recognize the opportunity to transform your business by taking our free course.

Posted by hpp
The National Debt, Taxes and How to Prepare Your Client

The National Debt, Taxes and How to Prepare Your Client

Taxes are inevitable. And, given the increase in the national debt, a rise in taxes also seems inevitable. As a financial advisor, your concern is what this means for your clients and their plans.

There are a lot of different things going on in Congress and we have a new administration in the White House. All indicators so far point to those earning $400,000 or more being the most affected.  But we also need to consider Social Security and capital gains.

What it means is that tax-deferred assets and tax-deferred savings like annuities will be very beneficial in the future. If you think about what we are looking at in terms of the growth of the national debt over the next 30 years, it is very likely that the increase in taxes will not be just short-term. Instead, it will be a more sustained increase in the need for tax revenue.

 And when having discussions with your clients, it means that you need to change your words. Don’t just talk about the nominal interest rate. Discuss the actual real rate of return. The real rate of return takes into consideration the impact of the actual rate of return, the increase in taxes, and the impact of inflation. And we’ve seen a little bit of inflation rear its ugly head when you compare annuities with many other alternatives, like certificates of deposits.

Annuities have a substantially higher real rate of return that will help your clients on an after-tax and after-inflation basis, allowing them to be able to buy the same things that they can today and well into their retirement. So, look at tax-deferred assets like fixed and indexed annuities. Your clients will be very open, given the consideration of where we’re headed with the national debt.

Call your retirement income consultant at (800) 589-3000. Sit down and talk with them about how tax-deferred assets can make a huge difference in the probability of success in your client’s retirement plans.

Transformational Tactic

Fixed and indexed annuities are effective planning tools against rising taxes and inflation.

Recognize the opportunity to transform your business by taking our free course.

Posted by hpp