Volume 24 No 4 Fall 2023
IARFC 40th Celebration & Conference
Join Us at Biltmore Estate® in Asheville, NC
A Growing Global Community “Used with permission from the Biltmore Company, Asheville, North Carolina”
Your IARFC Benefit at Work
Ethics Approved! Ethics Approved Status is awarded by maintaining a clear regulatory record and strict adherence to the IARFC Code of Ethics through examination.
How To Use Your Ethics Approved Status • • • • • •
Download Ethics Package Position Your Ethics Approved Seal Prominently Customize and Distribute Your Ethics Approved Media Release Display Your Certificate Leverage Your Status Prominently and Often Add Ethics Approved to Your Social Media Profiles
In This ISSUE Register Profile
40th Celebration and Conference pps 12-13
18 Member Focus
Jeremy Nason, RFC® Helping Average Agents Become Elite Advisors
Features
Used with permission from The Biltmore Company, Asheville, North Carolina
End the Year Strong by Uncovering Business 11 By Judy Hoberman
As a Financial Professional - Getting Started in the Industry Can Likely Take One of Two Forms 14 By Martin Cloutier, RFC®
Are You Holding Yourself Accountable to Your Clients and Prospects 22 By Jeremy Nason, RFC®
Tax Advantaged Exit Strategy 28 By Michael Tove, RFC®
The Joy of Delivering Accountability to Clients 33 By Bryce Sanders
Working Collaborations - CPA and Financial Consultant 34 By Joseph Jacques, RFC®
In Memoriam Edwin P. Morrow, II 1939 - 2023 page 16 The Register | Fall 2023
Columns 7 From the Editor 8 From the Trustee Chair 9 Trustee & CEO News
IARFC® News 17 30 31 33
New Journal of Personal Finance MRFC Exam Study Guide Member Benefits Founder’s Award Nominations
Chapter Connections
21 US Chapter Referral Program 24 Philippines 25 Hong Kong/Macau 26 China/Taiwan 27 Indonesia
A Growing Global Community Page 3
N e w M R F C ® s, R F C ® s, R FA ® s, and Association Members RFC®, RFA®, Association Members
Events Calendar 2023 Trustee Board Meetings December 6
2024 40th Celebration & Conference National Financial Plan Competition Finals April 22-24
Richard H. Bowler, RFC®, TN Xuong Xan Chu, RFC®, CA Louis Clark, RFA®, KY Velsilav Danailov, RFC®, MN Michael D’Angelis, RFC®, CT Robert S. Dillard, RFC®, AZ Bryan M. Frutchey, RFC®, WA Tyler Hill, RFC®, AL Rebecca P. Johnston, RFC®, NC John T. Kennedy, RFC®, OH Ruben Dario Maestre, RFC®, VA Enrique Martinez, RFA®, NC Luke Mutchie, RFC®, FL Mary A. Peterson, RFC®, KY Darrell D. Que, RFC®, HI Heather Reynolds, RFC®, PA Michael J. Samulski, RFC®, FL Kelly R. Smith, RFC®, CA Joseph S. Turner, RFC®, KY
International Chapters China - 75 Taiwan - 82 Hong Kong - 81
In Memoriam
John C. Johnson, RFC® Edward P. Morrow II James B. Moss, RFC® Ron D. Nisbet, RFC®
Order via the IARFC Store Enhance Your Visibility with
IARFC Marketing TriFolds
CE Quiz for Current
Hard Copy Subscriptions Available to Order
Journal of Personal Finance
the Register
White Papers
Page 4
The Register | Fall 2023
LEADERSHIP
CHAPTERS
BOARD OF TRUSTEES Chair, Barry L. Dayley, MRFC Vice Chair, Michael Jay Markey Jr., MRFC® Treasurer, Monroe Diefendorf Jr., MRFC® Secretary, Michelle K. Blair, RFC® Trustee, Kai Yuan Tu, RFC® Trustee, Dr. Reuben Chen, RFC® CEO, Leonard Simpson, RFC® COO, Charlotte Isbell ®
MRFC CERTIFICATION BOARD Chair, Robert Lawson, MRFC® Vice Chair, Mary Anne Redmond, MRFC® Treasurer, William Peterman, MRFC® Director, Sean Clark, MRFC® Director, Alan C. Kifer, MRFC® Director, Melvin Mills Jr., MRFC® Director, Julie Friend, Public Member
IARFC HEADQUARTERS TEAM Chief Operating Officer, Charlotte Isbell Editorial Coordinator/Public Relations, Susan M. Cappa Director of Membership Services, Vicki Caplinger Membership Services, Judi Nelson and Rachel Gibbs Information Technology, Randy Kriner
WEBSITES United States — www.iarfc.org
Greater China Development (China, Hong Kong, Macau, & Taiwan) Chair, Liang, Tien Lung, RFC® Vice Chair, Liang, Han-Ying, RFC® CEO, Lin, Chien-Hung, RFC® Hong Kong and Macau Honorary Chair, Samuel W. K. Yung, RFC® Chair, Teresa So, RFC® Executive Director, Allan Wan, RFC® Indonesia President, Aidil Akbar Madjid, RFC® Philippines President, Gamalielh Ariel O. Benavides, RFC® Executive VP., Grace De Vera Escobar, RFC® Vice President, Ismael Melendres, Jr., RFC® Treasurer, Ma Arlene M. Baguyo, RFC® Secretary, Atty. Nicasio C. Cabaneiro, RFC® Director, Cynthia Rimando, RFC® Director, Allan Tamayo, RFC® Taiwan Chair, Liang, Tien Lung, RFC® United States President, Bradley K. Maples Sr., MRFC® Executive VP., Lisa Ford, MRFC® Vice President, Lemuel W. Kornegay III, RFC® Treasurer, TBD Secretary, Gregory Kurinec, MRFC® Director, Paul Wharf, RFC® Director, Mike Zaino, RFC®
China — www.iarfc.cn Hong Kong — www.iarfc-hk.org Indonesia — www.iarfcindonesia.com Philippines — www.iarfc.org/about/philippines
www.iarfc.org/publications/register 146 N. Breiel Boulevard P.O. Box 506 Middletown, OH 45042-0506 (800) 532-9060 Editorial Coordinator Susan M. Cappa editor@iarfc.org Editorial Advisory Committee Michelle Blair, RFC® Constance Craig-Mason, MRFC® Alan Kifer, MRFC®
The Register is published by the International Association of Registered Financial Consultants® 2023 and circulated around the world. It includes articles and advice on technical subjects, economic events, regulatory actions, and practice management. The facts and opinions in the IARFC’s Register articles represent the author’s views and are not endorsed by the publisher. The IARFC makes no claim as to accuracy and does not guarantee or endorse any product or service that may be advertised or featured. The IARFC makes no claim to the current status of any designation or credential that is issued in the titles of contributors listed in the Register other than those issued by the IARFC® (RFA®, RFC®, MRFC®, MRFS).
Taiwan — www.iarfc.org.tw
Article Submission
The average reader has more than four years of experience in financial services and possesses at least one professional designation/credential. Articles benefit the reader by providing specific planning techniques, practice management suggestions, or educational content about financial services which might include advisory professional responsibilities, industry news, insurance, investment, software, or compliance. For the entire Register General Article and Editorial Policy, visit www.iarfc.org/register. The Register | Fall 2023
Articles, comments, and letters are welcome via email to: Susan M. Cappa, editor@iarfc.org Page 5
2024 Editorial Calendar Issue
Theme
Volume 25 No. 1 February
Volume 25 No. 2 May
Volume 25 No. 3 August
Volume 25 No. 4 November
Possible Topics to be Covered • • • • • •
IARFC 40th Celebration and Conference Biltmore Estate® - Asheville, NC April 22-24, 2024 How to leverage your longevity Membership in an established Association What does longevity mean to the younger generation? 90 is the new 70 for Baby Boomers Pursing an MRFC credential
• • • • •
Engaging client’s family - whose decision is it (pros and cons)? Aging out and preparing for your successor Not everyone has a built-in person waiting in the wings Is your biz scalable and/or sale-able (how and why)? Who will take care of the Baby Boomers?
Geographic Adaptability
• • • • •
Serving clients nationally (niche markets can be more than local) Appeal to a broader more spread-out base Is the personal touch gone? Tips on conducting business over boarders (licensing) Advantage/disadvantage of marketing through multiple mediums: seminars/radio/TV/podcasts/direct mail
Year End Gifting
• • • •
How to get your clients to gift graciously When is the best time to setup a gifting plan Advising clients to protect heirs from themselves Living life in the moment - when to advise clients to retire in spite of themselves Gifting - to attach or not to attach strings Tax advantages to charitable planning
IARFC Turns 40!
Family Progression Both Clients and Professionals
Plan Competition
• •
Issue
Copy Deadline
Volume 25, No. 1, February
November 1
Volume 25, No. 2, May
February 1
Volume 25, No. 3, August
May 1
Volume 25, No. 4, November
August 1
Advertise in the Register, published by the IARFC since 1999 and circulated around the world. Susan M. Cappa, Editor Phone: (513) 424-1589 Fax: (513) 345-9479 advertise@iarfc.org 11/1/23
Page 6
The Register | Fall 2023
From the EDITOR
Association Housekeeping
It’s a Good Story to Remember Susan M. Cappa, Editor
By-Laws
I first met Ed Morrow during the interview process for a position with the IARFC. As I walked into his office, I noticed a small, obscure, framed map on the wall. With closer inspection I identified the map as a dive training site located near Ponce de Leon, FL. As a former Scuba Instructor, I was very familiar with the facility and had conducted checkout dives there... thus it became a point of reference with Ed, an avid diver. Most likely, it helped get me hired. With his longevity and popularity in financial services, I am sure we all have such stories to share surrounding this IARFC leader. You can read more about his life’s journey and accomplishments on Page 16. As we prepare now for the IARFC 40th Celebration & Conference, I hope that all of our members will come together to support the Association’s banner year. We return to the Biltmore Estate® with high hopes of kicking off the next ambitious era of the IARFC. The Biltmore venue is not your usual conference type setting. It combines learning opportunities with an extraordinary feeling of elegance and historical significance. There is much to explore and enjoy. As our plans unfold, I know there will be something to attract the attention of every member. Let’s support this 40th milestone with gusto! This next phase of the Association involves providing new benefits for members and a focus on membership acquisition. If you were not part of the recent IARFC Practice Building Summit, you missed outstanding presentations by industry professionals. Our thanks to Summit host David Kinder, RFC® and Jeremy Nason, RFC® and for giving their time and attention to this project. Want to find out what you missed? The recorded sessions will be made available soon through the IARFC Store... and most likely you will see another Summit September of 2024. For now, MARK YOUR CALENDARS for April 22-24 and join us at the IARFC 40th Celebration & Conference. SEE YOU IN NORTH CAROLINA!
The Register reaches 5,000 financial professionals every issue. Register advertising is an easy and cost-effective way to promote your company’s products and services to this dedicated audience.
Services and Products Consultants Offer Annuities, all types
Disability Income
Loan Cancellation
Asset Management
End-of-Life Planning
Long-Term Care Insurance
Bonds
Estate Planning
Mutual Funds, all types
Business Planning
ETFs
Offshore Trusts & Companies
Business Succession
Fee-Based Planning
Precious Metals
Charitable Giving
Income Tax Filings
REITs
College Savings/529 Plans
Investment Real Estate
Retirement Plan/401(k)
Critical Illness Insurance
Life Insurance, all types
Tangible Assets
Please contact us with questions, for a media kit or for assistance in developing your customized advertising, exhibit, and sponsorship packages.
Advertise
The Register | Fall 2023
For those who are interested, the IARFC has made changes to the By-Laws. Voted on by the Board of Trustees, the updates have to do with elections of officers for the Chapter Boards. The most recent copy of this Governing Document can be found on the IARFC Website under the WHO WE ARE section.
Ethics Exam
Additionally, there were changes made to the Ethics Exam and the frequency needed to take it to complete the requirements for the “Ethics Approved” Status. Now existing members and new members will only need to pass it one time rather than every other year. Contact Membership Services if you have questions.
Code of Ethics
If you have not referred to the Code of Ethics recently, they have been changed. The most current reflects a removal of the last statement to be more in line with the operations of IARFC Consultants. Members who have a Code of Ethics displayed in their office should update to the newer version.
IARFC Code of Ethics I will put my clients’ interests above my own at all times within the scope of my abilities. I will maintain proficiency in my work through continuing education. When fee-based services are i nvolved, I will charge a fair and reasonable fee based on the amount of time and skill required. I will abide by both the spirit and the letter of the laws and r egulations applicable to f inancial planning services. I will give my clients the same service I would provide to myself in the same circumstances.
Contact: (513) 424-3481 advertise@iarfc.org Page 7
VISION
LOVE
SERVANT
INTEGRITY
INNOVATION
PROACTIVE
AUTHENTIC
RELEVANT
A Growing Global Community
From the Trustee Chair Barry L. Dayley, MRFC® Contact: (307) 201-8524 chair@iarfc.org www.iarfc.org
In 2024, we reach an important milestone, forty years ago our organization was founded. We invite you to join with us, in this 40th Celebration & Conference on April 22 - 24, 2024. Our venue will be the beautiful Biltmore Estate® in Asheville, North Carolina. This will be an informative and educational event, where attendees will hear from industry leaders and peers. You will glean ideas to grow your business and income. A highlight will be to experience the annual IARFC National Financial Plan Competition. See the talented new generation of financial consultants show their stuff, where you can celebrate their success. Witness the presentation of the coveted Loren Dunton Lifetime Achievement Award. But most of all, this is an opportunity for you, to be with peers; to network, have fun, and renew relationships. The International Association of Registered Financial Consultants was founded in 1984 by, John “Jack” Gargan. Jack started his life insurance career in 1957 and was active in the early days of the financial planning movement. He was a contemporary of Loren Dunton, the founder of the financial planning movement. Due to his commitment to quality services for the public and better trained financial Page 8
consultants, he found the need to step forward with an association that established higher standards of training and ethics than existed at that time. In 1999, Edwin P. Morrow II, took over as Chairman of the IARFC. During his tenure, the Association experienced growth in the United States, and began expansion internationally in Taiwan, China, and Malaysia. Using his talent of public speaking and academic prowess, Ed was instrumental in establishing education courses used throughout the IARFC’s area of operation around the world. In addition, he was the driving force of the IARFC National Financial Plan Competition, with the first held in 2006 in Las Vegas, Nevada. Ed served the IARFC for over two decades where he brought about much good. Sadly, Ed Morrow passed away in September 2023. We honor him for the tremendous contribution to the Association. He will truly be missed. In 2017, Dr. H. Steven Bailey, MRFC® was contracted for the Chairman and CEO position. Under his leadership and talent to build stable long-lasting organizations, the Association moved to new headquarters, the Ethics Approved Program was initiated, the Master Registered Financial Consultant (MRFC®) credential was created, and the Ambassador Award Program was established. Organizationally, the By-Laws were revised by the Board of Directors establishing a Board of Trustees and defining Chapter Boards, including a new Chapter in the United
States. In 2020, a new Chapter was established in the Philippines. Under Steve’s leadership, he unbundled the Chairman / CEO roles. Going forward the Chair will be a volunteer position and the CEO will be a paid executive position. Steve retired at the end of 2022. His steady leadership is greatly appreciated to bring us where we can continue to build for the future. We are truly grateful for the great work of our predecessors for they brought us where we are today. Looking forward, we are poised for a decade of dramatic growth globally, with the objective to be operational in 35 countries and adding more than 20,000 new members. This level of expansion will require fundamental changes as we work to raise the level of education and professionalism in the financial planning movement and support a growing global community.
Barry with the “Banteng Wulung”, the icon of the Indonesian Stock Exchange.
The Register | Fall 2023
New IARFC Trustee Board Director Dr. Reuben K. Chen, RFC®, CFP®, CLU Dr. Chen has close to 35 years of experience in his wealth strategies practice. He is the founder, CEO, and President of Wellspring Consulting, the Silicon Valley Member Firm of M Financial Group. The focus and experience of his practice encompasses the areas of retirement and estate planning, wealth management programs, business succession planning, and tax reduction strategies to build, preserve, enjoy, and transfer that wealth for his clients. He serves as the Family office for retirees, professionals, small and mid-sized business owners, corporate executives, high-networth families, real estate investors, and family foundations throughout California and a few other states. His philosophy is to maintain a well-balanced life and to help individuals to realize their dreams by incorporating life coaching and business consulting with active fee-based financial and estate positioning strategies. Over the years, he has been a featured speaker for many professional associations, Chamber of Commerce, churches, radio shows, and TV shows. “I am honored to be elected to the IARFC Board of Trustees,” commented Chen. “It’s important to give back to a profession that has allowed me the opportunity to influence the financial futures of others. By helping the Association serve its members, I feel privileged in sharing my experience and knowledge. My hope is they can benefit from the roads I have traveled.” Chen’s personal journey supports his decision to join the Board. As a Chinese-American descendant from Hong Kong who has resided in the USA for more than 40 years, he has earned his education in America and has been in the Financial Industry for over 35 years. During this time, he has furthered his education and knowledge by acquiring RFC®, CFP®, CLU & Ph.D. credentials. He also has 12 state insurance licenses, and Series 7, 63, and 65. He has mentored and trained hundreds of apprentices in the USA and abroad, including in Hong Kong, China, and Taiwan. From these experiences, he has gathered a broad knowledge of the underlying motivations behind both agents and advisors. IARFC COO Charlotte Isbell and CEO Leonard Simpson, RFC® at recent Ameritas Conference in Cincinnati, OH
Giving Back Gets the Job Done! From the CEO... Leonard Simpson, RFC®
First I would like to express my sincere thanks to a couple of individuals who were instrumental in making the IARFC Practice Building Summit a success. Taking charge of this informative two day event were Jeremy Nason, RFC® and Host David Kinder, RFC®. These members gave of their time freely because they believe in the IARFC and wish to see it expand its membership and benefits. Working with them has been incredibly encouraging about the caliber of consultants who make up the Association. Congrats to a job well planned and executed! You Can Bring Added Value... Moving on to the 40th Celebration and Conference, we need all hands on deck to help plan a successful conference. This is a big deal for the IARFC and we wish to have as many members there as possible. Assistance is greatly needed in getting sponsors, speakers, and exhibitors. Already US Board Director Paul Wharf, RFC®. and Gary Padussis, RFC®. have provided planning assistance... but we need more members to give back by getting involved. Have you entertained the idea of making a difference? Now is the time to get in touch with me so we can capitalize on your experience and connections. Many hands make the job less daunting. Backed by the IARFC Headquarters Team, your leads, contacts, and ideas can bring value to all. At a minimum, we would like you to make a commitment to attend and network with fellow professionals. Let’s work together for an amazing 40th Celebration and Conference! Contact me at ceo@iarfc.org and we will discuss our Conference Exhibitor/Sponsor Prospectus.
The Register | Fall 2023
Page 9
End the Year STRONG by Uncovering Business How many of you have heard this or perhaps even said it…. “I can’t sell now because it is the end of the year.” Are you serious? If that’s the way you think, you are setting yourself up for failure. When I was at the height of my sales career in Insurance, my manager told everyone that July was the worst month of the year for sales because everyone takes a vacation…only to be followed up by the time between mid-November and New Years. After all, who is going to buy insurance at that time of the year? I want to tell you that my strongest months were those times, even though many others bought into his theory. Let’s talk about some ideas that if done right, the next 2 months can be extremely profitable and not only end your year on a high note, but begin 2024 ready to rock and roll! Sales is about relationships and what better time to build them than during a time when most people are feeling Page 10
“good will toward all”. For many business owners, the holiday selling season can account for a big chunk of yearly sales, and a big boost to your bottom line. So how do you make sure you are reaching customers so that you too can give yourself a holiday gift? 1. I’m sure you have heard that 80% of your business comes from 20% of your customers. It’s very easy to work with that 20% especially when you have built and nurtured a relationship with them. But what about that other 80%? Why not start at the very bottom of your list and call on that other 80%? I bet you would find interest from customers that haven’t been buying anything from you in a while. Things change and circumstances change. It’s worth the time and effort. When I was selling insurance, I would call and offer to do a policy review. There were so many people that didn’t know some of the new products I offered…and yes, I had sent them information, but we all know how many emails we all receive. It just may be possible they didn’t read that information or perhaps wasn’t what
they needed at that time. Also, there might have been a new baby or a change in marital status or anything that may have needed an update. You have a gold mine in front of you. While you are at it, why not clean out your CRM and also enter all those business cards and leads that are sitting on your desk in piles? See who needs to be called and pick up the phone. It is amazing how things happen when you actually speak to someone. 2. When you are in sales, there are only two words that make sense during the decision time…yes and no. Where did maybe come in? Go back through everyone that did not make a definite decision, you know all of the “maybes” and see how you can turn that into a decision. A “No” is much better than a maybe and allows you to move on! 3. What about creating Valuable Content For your Clients? Content marketing is one of the best ways to show value instead of a sales pitch. Building a relationship with content that may peak your client’s interest is a way The Register | Fall 2023
to create long-term success. Articles that you send to a client with a quick “saw this and thought about you” is a way to show that you are not only thinking about them but that you aren’t trying to hard-sell. You are being pro-active rather than reactive. Your name is in front of them as a resource rather than your typical salesperson. Make sure your content is compliance approved. 4. Building relationships is key. People do business with those they like and trust and that begins with relationships. Why not attend some events where your target clients “hang out” and get your name and face in front of them. No pressure, no sales, just building relationships when you have some downtime. You are laying the foundation for future business. Remember businesses don’t do business, people do. Being out and about during the holidays, or any time of the year, is good for business. When business is slow, we cannot let it slow us down. Most of us understand that technology can help us stay in touch with people and improve communication, but nothing beats going out and meeting people face-to-face. During the holidays there are numerous opportunities to reconnect with old friends and to make new ones. Building relationships now turns into business later.
following up, you will set yourself apart from the rest of the pack. So, let’s blink and it is January 2024. What are you going to do to find business between now and January? I love this quote by Benjamin Franklin that seems to fit, “By failing to prepare, you are preparing to fail!”
Judy Hoberman President, Selling In A Skirt Judy Hoberman is President of Judy Hoberman and Associates, a company focused on empowering professional women. She is an international speaker, trainer, executive coach, author, radio show host and mentor. Her 30 years in business has given her both knowledge and a sense of humor about how men and women lead, sell, manage and recruit differently.
The Register | Fall 2023
Complete Archiving Solutions Smarsh and Actiance combined in 2018, creating the leading, pure-play archiving provider. Two companies with legacies of innovation complemented each other well, and their individual award-winning solution sets combined together to create the Connected Suite. With on-prem and cloud capture solutions, as well as multi-tenant and private, single-tenant archiving options, Smarsh can meet the needs of companies ranging from the world’s largest banks and government agencies to single-
As you can see, it’s all about a plan. Make your plan today and decide how the end of the year is going to be for you. You can implement something and make things happen or you can do nothing and in 6 weeks you can say “I couldn’t sell because it was the end of the year”. Did you know that 80% of sales are made somewhere in the 5th-12th contact and the savvier the client, sometimes the longer the sales process? Sometimes it’s due to the economy but chances are you may not close on the first time. Do you know how easy it is to lose sales because you didn’t follow up? Following up is the most important part of the sales process. What generally happens is that after a certain number of touch points, you could get distracted with newer prospects. Did you also know that 48% of sales people never follow up with a prospect? Simply by the act of
Member Benefit
office broker-dealers.
US Chapter Is looking for a Member for the Board of Directors Contact vicki@iarfc.org
Link: www.smarsh.com Contact Person: Tom Lynch Mobile: (609) 661-8562 Attend our weekly live demo: Sign up at: www.smarsh.com Watch it work!
Member Price 10% off Page 11
Used with permission from The Biltmore Company, Asheville, North Carolina
JOIN US at historic Biltmore Estate® 40th Celebration & Conference April 22-24, 2024 Speakers • CE Breakout Sessions National Financial Plan Competition Finals • Vendors Networking Opportunities • Awards Banquet Relax and Enjoy historic Biltmore Estate® more info: iarfc40@iarfc.org Page 12
The Register | Fall 2023
SAVE the DATE Conference Registration Coming Soon Join us as we celebrate 40 years of serving the financial profession through a convergence of like-minded, practice-oriented individuals. Meet with your peers and find out tried and true methods of their successful practices. Pick up new ideas from our lineup of industry experts who will share their knowledge and experience. Meet the next generation of consultants as they represent their universities in the National Financial Plan Competition. Enjoy lively panel discussions and hear inspiring motivational speakers. And then, enjoy the sophisticated surroundings of Biltmore elegance - all nestled in the breathtaking panorama of the Blue Ridge Mountains. It’s a perfect getaway to learn, relax, and rejuvenate. Plan to reserve your time with us soon!
Used with permission from The Biltmore Company, Asheville, North Carolina
Since 1895, Biltmore has welcomed guests from all over the world to experience the splendor of George Vanderbilt’s visionary estate.
The Register | Fall 2023
Page 13
As a financial professional.... getting started in the industry can likely take one of two forms: 1. The “finance” track in college – studying world markets, equities, and business law which may lead to a career fair or financial planning connections to get started in the industry. Many times, this would mean starting out with a mentor at a larger firm. 2. The mid-life career change route – which I’ve seen with just as much frequency. Job loss or burn out in the corporate world may land a candidate in the crosshairs of a recruiter. The intrigue of “unlimited earning potential” and “making your own schedule” may be just enough motivation, when packaged with training programs, leads, corporate support, and early career financing, to seal the deal. In either case, most will admit the first few years are extremely difficult. What happens after the consultant makes it 3 to 5 years and is successful? Likely, industry understanding, strengths and weaknesses, and financial product availability is not fully comprehended by a consultant until after a good amount of experience. Now the established practitioner can make an informed decision of “right fit” for their financial planning practice and broker/ dealer where they hang their hat. What if the firm where you first started your career is not the firm for the long haul? Here are some real-life experiences I had when changing broker/dealers after 19 years in the industry, along with tips and ideas I learned going through a drawn-out FINRA arbitration over the matter.
Contact Matthew: (303) 948-5551 *Note: Securities offered through Securities America, Inc., member FINRA/SIPC. Advisory services offered through Securities America Advisors, Inc. Golden Wealth Solutions, Inc. and Securities America are separate entities.
Page 14
1. Contract Issues • Understand the current contract and what is expected from a change. There might be language in the contract about terminating with notice, and/or without notice. What constitutes notice and a termination. • Review the contract language about what is considered a client. Is the client listed as property of the company or of the consultant? What is the basis of this property and how is a client defined? It may be specific to an account, or broader like clients PII or even as generic as a “first name and phone number”. This is all important information to consider and ask the recruiting broker/dealer to clarify. • Consider employment classification. A W-2 employee is regarded very differently from a 1099 independent contractor. There are industry experts that consult on this very issue and can provide guidance on industry standards for both. • Understand how technology is treated under the contract and are licensed provided by the broker/ dealer or consultant. If technology clauses in the contract are up-to-date and valid, even the most prudent broker/dealer compliance and technology protocol could become obsolete in just a few years. It is a fast-changing and dynamic issue for both parties to consider. Who retains software, data, and hardware, and is it specifically addressed in the contract?
• Define the difference between data on a company laptop versus a personal cell phone, and are they outlined in the contract. As an example of this, an employee consultant that unwittingly shares client data to the prospective broker/dealer, could be looking at a serious S-P violation. Even the independent practitioner needs to tread carefully, because one wrong move about data and privacy could still result in a drawn out FINRA arbitration.
2. Compliance Requirements • The annual compliance exams provided by the broker/dealer and RIA are to ensure knowledge and full disclosure of corporate practices and procedures. While these “examinations” often seem redundant and cumbersome, they are an important part of working in the securities industry. Many times, questions are listed as “true/false” or “yes/no”, other times a text and explanation input field. • A portion of the annual check-ups are to keep in alignment the broker/dealer and financial consultant. Specifically, disclosure of DBA or other business activities that need to be disclosed, outside sales offices, and third-party vendors. Most consultants keep current on their DBA or outside activities, and rightfully so, there can be penalties associated with non-compliance. • An area of interest and caution for the consultant looking to change is the use of third-party vendors. This would include listing of a website manager (FMG or Forefield), client relationship manager The Register | Fall 2023
(Redtail or Sales Force), financial planning software (eMoney or Financial Profiles), etc. However, a point of particular interest should be given to the often overlooked and “newer” resources consultants use. To name a few, client-consultant text services, virtual or on-line scheduling assistants, information technology and data security vendors, and storage/back-up systems. For the employee consultant, many of the hardware and software vendors are provided at the firms cost, and therefore not licensed by the consultant…but not so for an independent practitioner. Most, if not all security, data storage, hardware and software are at the expense of the consultant. Even so, they must be disclosed on the annual exam. This is important regardless of intention to move broker/dealers or not. Staying in compliance here is a must.
3. Fiduciary Focus • One of the most pressing and important discussions is, “What is going to happen to the client?” There are aggressive recruitment strategies for high-preforming, top-tier consultants. It is a competitive area. The sole and expressed purpose of recruiting this type of consultant is to bring over the clients. Not once has a consultant said, “I think I’ll start over, start my client base from scratch.” Keeping the ego in check for the betterment of the client and investment account is always paramount. • The severing of one business relationship for another could lead to possible contention with the old broker/ dealer. This is difficult because it is likely there will be no conversation beforehand about a transition. This will be a time of confusion for some clients. Other clients won’t have the slightest clue anything happened until a year later. It is a client’s decision who their consultant is and which broker/dealer they associate with. • Ask questions early with a prospective broker/dealer like: - What happens if my old broker/ dealer does not release my registration? - What information am I allowed to retain, based on my current contract? - If there is dispute, who will cover the legal cost, the new broker/dealer or the consultant?
The Register | Fall 2023
At the end of the day, the two questions I see as most relevant for deciding to change broker/dealers are as such: 1. What is in it for my clients – is it in their best interest (i.e., more financial programs available, better tools for clients, lower fees, etc.)?
Member Benefit
2. What is in it for me and my practice (i.e., greater support, better GDC payout, easier technology platforms, streamlined process, etc.)? When weighing the pros and cons, if both questions are answered in the affirmative, with material benefits, then it may be worth considering a change. As a word of caution, taking everything a new firm tells you at face value, during the “honeymoon” period, may not be all it cracks up to be. Do your research, get the details in writing, and follow the process to the “T”. Do not take any point lightly and don’t take shortcuts. In doing so, you improve your chances of a successful switch and God willing you won’t wind up in a FINRA dispute over the matter. The tips and ideas were items learned firsthand in my experience, and while justice did prevail in our case, it was a tiresome and disturbing 16-month process. If the practitioner decides it is time to switch broker/dealers, it should be done in a well thought out, professional, and prudent manner, by all parties involved.
Multi-Dimensional Risk Tolerance Questionnaire and Tool Kit Totum is the only multidimensional risk tolerance questionnaire and toolkit that helps advisors understand how much risk their clients can comfortably take based on their life situation. With Totum, you can easily customize how you engage with your clients and have in-depth discussions about their Risk Preferences, Risk Capacity, and Portfolio Risk. This risk clarity closes prospects faster, helps win additional assets from existing clients, and serves as a necessary reassurance when anyone has doubts.
Matthew Cloutier, RFC® Golden Wealth Solutions, Inc.* Matthew Cloutier is an independent financial advisor of Golden Wealth Solutions, Inc., a company which he and co-founder Michael Herman created over 20 years ago to help individuals and families make smart choices with their money. Matt is a Colorado native and has been married to his wife Maegan for over 14 years; they are raising their two children and endeavor to be faithful followers of Christ.
The Totum Risk toolkit includes the multi-scoring risk questionnaire, integrations, analytics, model marketplace, and custom reporting with an IPS all for $99/month. Get career details including projected growth and wages, daily tasks, recommended education and skills and much more.
$100 off Pro Plus Annual Subscription Page 15
In Memoriam Edwin Porch Morrow, II 1939 - 2023 EDWIN PORCH MORROW II, 83, of Middletown, OH, passed away on Friday, September 1, 2023. He was born September 10, 1939 to Charles and Lois (Belcher) Morrow, both of whom preceded him in death. Ed spent his childhood in Highland Park, IL, departing to attend Centre College and University of Louisville Law School prior to joining the U.S. Army. Following his honorable discharge, he continued public service working for the Kentucky Republican Party, following in the footsteps of his grandfather Edwin Porch Morrow, the 40th Governor of Kentucky. Ed then transitioned to the business world, initially as a financial analyst at Dun & Bradstreet and later as a manager in a prominent life insurance company. With his expertise in corporate finance, Ed foresaw the growing need for comprehensive financial planning services: he was an early pioneer of the financial planning industry, founding Financial Planning Consultants in 1969. Over the next decade, Ed expanded from serving individuals to the professional development of the entire financial planning industry via training, consulting and software development. A trailblazing technologist, Ed started using computers in his practice at its founding and lectured across the U.S. on the use of computers in financial services during the seventies and eighties. Ed authored eight software programs for financial planners, and he consulted with countless advisors, insurance companies and broker/dealers in the areas of practice management and computerization. His most popular software, Text Library System, included thousands of essential documents relied upon by more than 4,000 financial planning firms across the U.S. Ed’s professional expertise and passion made him a sought-after speaker, editor, partner, and consultant worldwide. He was an adjunct instructor in financial planning at Purdue University, a Practitioner in Residence, adjunct professor at Wright State University, and served on the Financial Planning Advisory Board at Kansas State University. For eight years, he hosted a weekly radio show, “Money Talks” on WPFB. The majority of Ed’s career was focused on the development, growth and professionalization of the financial planning industry. In 1975, Ed led the 6,000 members of the Ohio Association of Insurance and Financial Advisors. He subsequently served as a Director of the Institute of CFP, Mentor at the first ICFP Residency, established the Financial Advisors Section of NAIFA, and was the CEO of the International Association of Registered Financial Consultants (IARFC). Under Ed’s leadership, the IARFC dramatically expanded membership across the U.S., and he spearheaded its international expansion. He lectured on financial planning, practice management, and marketing in Britain, Canada, Australia, Malaysia, China, Taiwan, and Philippines. Also he was responsible for curriculum development for several financial planning degree programs offered in China and Malaysia. Ed held many professional designations, including RFC, CLU, ChFC, CFP, CEP, and he was a frequent presenter and contributor to their respective professional associations. His 500+ articles, three books, 40 manuals and hundreds of presentations led to his international recognition as "the advisor to financial advisors”. In addition to his professional pursuits, Ed was an active contributor and participant in community service, particularly in the arts. He was an early supporter of Arts in Middletown, including hosting artists-in-residence and was heavily involved with the Sorg Opera House. He was well-known by loved ones for his deep appreciation of opera and poetry. He enjoyed international travel, particularly to destinations that supported his lifelong passion for scuba diving. Ed loved his family and will be greatly missed by all. He is survived by his wife, Maggie Morrow (Lami Choi) and three children: Ed Morrow III (Shirley) of Dayton, OH; Susan Morrow of Orinda, CA; and Kate Morrow Dykes (Greg) of Monroe, OH and their mother, Charlene O’Connell of Lakeside, KY. Ed is survived by his five granddaughters, Audrey and Mackenzie Morrow, Anora DiDomenico, and Chloe and Kara Dykes. He is also survived by his beloved sister, Starr Morrow of Bluff City, TN, along with many nieces and nephews.
Page 16
The Register | Fall 2023
Member Benefit
New Fall Journal
In This Issue... •
2023 National Financial Plan Competition Winning Case Narrative The Kendrick Family, Sheridan, Wyoming
•
Do Demographic, Psychological, and Financial Characteristics Increase the Likelihood to be Victims of Credit Card Fraud?
•
College Student Financial Well-Being: A Re-Examination of Cross-Racial and Ethnicity Differences
•
Race Ethnicity and Financial Advice Seeking: An Examination of Three Datasets
•
Credit Card Usage and Long-Term Personal Financial Management
Continuing Education Quiz
Access to Continuing Education to Meet Your CE Credit Requirements The benefits of the “Package Pricing” allows IARFC members to receive ALL the CE units needed to renew their license for the low price of $29.95. The Success CE package price is good for 365 days. Save time and money while enjoying the best quality service and support! Getting your CE credits has never been easier or more convenient, with SuccessCE’s easy-to-complete content. Try us today and you will be pleased! Website: https://www.successce.com Phone: (949) 706-9453 Email: Info@successce.com
Register for the Journal of Personal Finance Online CE quizzes and receive both the Spring and Fall 2023 quizzes for $20. Read the articles in the Journal and then take the quiz online. The questions are provided in the back of the Journal for reference. Once you have registered, you will receive an email with a link to access the quiz. Two (2) hours of IARFC CE will be awarded to anyone who achieves a score of 70% or higher per quiz. Only one quiz submission per IARFC member is allowed. IARFC CE Guidelines for Professional Self-Study. Up to five (5) hours may be claimed for reading academic journals maximum ten (10) hours.
The Register | Fall 2023
Member Pricing $29.95 Page 17
Member Focus Helping Average Agents Become Elite Advisors Insurance Pro Shop
Contact: (877) 297-4608
Jeremy Nason has been a member of the IARFC for almost 20 years – utilizing his IARFC membership, writing articles and most recently being part of a Strategic Planning Committee that has brought you the Virtual Practice Building Summit this past September. He also has an established legacy with his father, Lew Nason through the Insurance Pro Shop. Their mantra is “Helping Average Agents Become Elite Advisors”. From Jeremy, we can hear his story of how he started and how he now helps other consultants to be their best… Register: Lay out your journey in the financial services industry – from just starting out to where you find yourself today. Jeremy: I started in financial services formally in 1994 working for my dad’s (Lew Nason) career agency as an Agent Support Specialist where I learned how to develop cases for life insurance and investment plans. I got my life insurance license in 1996 and began selling, floundering at first, with my “Can’t Listen to Dad” immaturity. But a year later after failing my way, I decided to finally listen and learn from some great mentors and my dad was one of those. My business took off personally, and the Agency we ran was exploding and growing until 1998 when my grandmother became ill. Lew and Rosemary(mom) took care of her until her death in 1999. Upon my dad’s return to the office full-time in 1999, we decided to make a change and go in a different direction, focusing more on training agents and filling the education gap between carriers and agents. Thus, Insurance Pro Shop was born. For the past 23 years, I have continued my studies, honing my skills as an Advisor, Coach, and now Mentor myself. Register: In your career path, relate the importance of mentors and who did you have that helped you become successful. Jeremy: In my opinion, having mentors is a crucial part of becoming successful in any career. Without my mentors, there were times when I couldn’t move forward. I got stuck between my ears mostly, but my mentors have been able Page 18
to push me through it, teach me lessons, hold me accountable, and teach me how to be successful. I have had a bunch of mentors over the years, Edwin Morrow, Jack Gargan, Charlie Jones, Mehdi Fakharzadeh, Forrest Wallace Cato, Sandy Schussel, Van Mueller, Joel Weldon, and Lew Nason. I would not be the coach, agent, or man I am today without the advice, teaching, and coaching from these giving people. The most important lessons I have learned are from working side-by-side with Lew. This had the greatest impact on my career as an agent and a map to train other agents. From teaching me my first questions “How do you feel about that?”, to helping me close my first whole life sale ($7200AP) at age 19, to being my daily sounding board, to growing a business and my continued evolution, I owe everything to Lew and my mentors! Register: Why did you decide to become mentors for other financial professionals and how did your own experiences with clients help in that process? Jeremy: After being in the business for many years, I realized there is a MAJOR training gap. Most recruiting organizations and carriers only train agents on how to sell products. They
don’t focus on teaching agents how to sell and prospect. When I got into the business, I worked with Lew. I got the career style sales, prospecting, and training as agents did back in the 70’s and 80’s. Most agents don’t get that chance. This is exactly why we decided to open the Insurance Pro Shop – to fill the gap between Carriers/ IMO and Agents and to give all agents an option to receive the 80’s career shop sales and prospecting training that agent needs to succeed today. Even more so today, with all the fiduciary changes, learning how to Identify, understand, and solve problems is the only way to safeguard your business. Advisors cannot just sell for money; they need to be able to justify the sale. My experiences with clients have elevated my coaching and mentoring. From days of shadowing Lew on sales, to my personal sales, to doing joint work with MDRT Top of the Table producers...I’ve seen it and done it! What I have learned in the trenches shapes how I teach agents how to
(Above L-R) Jeremy & Mentors, Wally Forrest Cato, Sandy Schussel, Mehdi Fakharzadeh and Lew Nason
The Register | Fall 2023
Jeremy Nason, RFC® communicate with prospects effectively, from the initial approach, to how to close “9 out of 10” sales consistently. All my experiences have morphed and evolved, and what I am able to teach and install in my advisors has elevated them to the top levels of our industry. Register: Do you currently work with your own clients or are you just on the professional side? Jeremy: I do still see clients, time permitting although I spend so much of my time helping agents that I cannot see a lot of clients right now. I am okay with that for one reason ( it’s one of the reasons I co-founded the Insuranceproshop.com): If I work in my local market, I can go out and help 500 to 1,000 families in my local area. By doing that I can make a huge change to our local area. However, if I train 10,000 financial professionals to help 500 to 1,000 families each, I can make a HUGE impact on families in the USA and around the world. My goal is to help/ touch over 50,000,000 families! We are well on our way to hitting that goal! Register: What is your philosophy on the Financial Planning Process and how do you refine that with your consultants that you mentor? Ultimately, what is your secret to becoming a respected trainer and coach? Jeremy: We follow the father of Financial Planning, Loren Dunton’s definition of Financial Planning… “Helping average people learn how to spend, save, invest, insure and plan wisely for the future, to achieve financial independence.” This is the creed, motto, and mission of what we teach. It’s a mission to help every family stop living paycheck to paycheck and help middle-class, middle-income families to thrive financially. If we don’t save the middle class, our economy will fail. I challenge agents to accept this mission of helping families FIRST. My secret is my passion, compassion, and desire to help! So, many agents are here just to make money selling products or investments. They have zero care for their customers because they really don’t have clients. I want to change the agent and advisor mindset. The Register | Fall 2023
The more we care about our clients, the more we can help. The more we help, the more money and referrals we get. “You can have everything in life you want; if you will just help other people get what they want.” ~Zig Ziglar Ultimately, the secret to my success in creating elite advisors is getting back to the fundamentals of consultative sales, consisting of 2 pieces. 1. Keeping It Simple. Breaking down complex laws, products, strategies, and concepts into their simplest forms and giving the advisor the ability to identify, communicate, and implement these strategies with their clients. 2. Problem-Based Sales. Teaching advisors how to ask the right questions, finding the problems, peeling back the layers of pain, and communicate a simple emotionally charged solution. Summing it up to… We apply a simple solution, based on a philosophy that people buy based on emotion and justify the decision based on logic. If advisors apply this to all their sales, they will increase their sales! Register: What is the biggest stumbling block that gets in the way of consultants going from Average to Elite? Jeremy: The biggest block is not knowing how to effectively communicate with their prospects; more precisely, how to communicate the problem to the prospect. Most agents tend to tell the prospects what they should be doing, and why their product will help them. There is a simple philosophy, People Buy Based on Emotion and Justify Their Decision Based on Logic. Most agents focus too much on the logic side, trying to convince the prospect how their product logically helps them when they should be getting the prospect emotionally involved. For example, asking thought/emotion-provoking questions: What would happen if your spouse didn’t make it home tomorrow? How would that affect your family? If you lost their income, what would you do? How
would you and your family survive without it? Could you keep the same standard of living that you have now? How do you feel about that? What would you like to see happen? The idea is to get the prospect talking and thinking about how the situation would affect them versus us telling them how great our life policy is, or throwing up benefits and statistics. The Elite Advisor has learned to help prospects identify their own problems and then help them come up with their own solutions. They have learned how to use emotional questions to help prospects to sell themselves. Register: Describe your Trusted Advisor Success Program™. How does it help Advisors? Jeremy: Our Trusted Advisor Success Program™ is about teaching financial professionals how to help middleincome families (people) find the money to Live Debt-Free and Truly Wealthy! It is about helping families (people) find the money to get all the cash-value life insurance they need to protect their families, save for a tax-free retirement, save for college, create a family bank and more, using their cash-value life insurance and annuities. We teach the entire sales process from approach to close with all the tools, training, and marketing needed to be successful. The result is the top agents and advisors that we train earn over a million dollars per year selling life insurance, annuities, investments, and their services. While thousands of the agents and advisors who earned $30,000$50,000 per year, within a year, now earn $100,000-$200,000! And their income keeps growing as they become the Trusted Advisor people want to see! Register: Ultimately it is about the Client and their Financial Future. How has this factored into your own experiences and then the training of others? Jeremy: “THE CLIENT COMES FIRST!” Rule #1! This integrates into everything I do and teach. We cannot make mistakes! Our client’s money and future are at stake! From day one, I instill the client comes Page 19
first mindset. If an agent won’t adopt this mindset, I cannot help them. I have seen too many clients hurt by agents, whether it’s a lack of planning, improper product placement, or improperly run products. Some of these issues can be corrected with education, while the agents taking advantage of clients need to be removed or barred from this industry. It’s harsh, but they are ruining people’s lives and futures. Register: You are quite prolific in your writings and postings to Linkedin. Tell us about the discipline process of consistent communication. Jeremy: “Successful people do, what unsuccessful people are unwilling to do” - Gray’s Common Denominator of Success. I live by this every day, I make time every day, whether I’m sick, dead, or dying to get my articles, messages, and posts, up according to a previously planned schedule. Nothing I do is by accident. Every piece that goes out is planned out, mapped out, before it is put into the ether. Some people call it dedication to a business, I call it... my mission. My mission is to help as many agents and advisors as possible – no matter what it takes! Register: When and Why did your association with the IARFC begin? Jeremy: I joined in 2005, as one of my mentors Forrest Wallace Cato, recommended. I joined to separate myself from other advisors, to help my image, and enhance my credibility and further my knowledge. Attaining the RFC designation has enabled me to build credibility with my prospects and clients personally, and 18 years later, it is still the ONLY designation I carry. Joining the IARFC is one of the best choices I ever made, because of the two IARFC mentors I met – Edwin Morrow and Jack Gargan. I spent many weeks in Middleton, OH with Ed Morrow and Jim Lifter developing the Original Financial Planning Course, which laid some of the groundwork, for the now MFRC credential and multiple training classes designed by the IARFC. Register: The Association thanks you for your support in the recent Virtual Summit Meeting. Why are these Summits important and do you see a future of more such events? Page 20
Jeremy: Continual education is key to personal and professional growth. The events I have attended, designed, and spoken at are phenomenal learning experiences. The gathering of likeminded speakers, trainers, and financial professionals creates a conducive atmosphere for learning. I am reminded of the days of the In-Person Educational Conferences hosted by the IARFC and many carriers. I attended many events and always came back with a nugget or two of information to help more clients and advisors. But that’s just the beginning. I found networking opportunities, carrier connections and many of my mentors at these events. I hope the event we did in September is the start of the next round of education events the IARFC will hold. I hope to be a part of future events for years to come! Register: What do you perceive as the benefits of joining the IARFC or how to better utilize your membership?
with my 3 adult children and extended family. But a majority of the time I’m playing with my 3 beautiful granddaughters and adopted grandson. Register: Lastly, the IARFC is celebrating its 40th Anniversary starting in 2024. What are your hopes and recommendations for the next Association during the next decade? Jeremy: My hope is to have IARFC be the most recognized association in the financial services industry. I will continue to bring financial professionals in to create a THRIVING membership! I’m super excited about the Live 40th Celebration and Conference at the Biltmore Estate®, in Asheville, NC - April 22-24, 2024! Recommendations… Stay the Course! Keep Growing! Push the Mission of ethics and education to every financial professional!
Jeremy: Consistent Education and being held to a high ethical standard. I read The Register every quarter and always learn a nugget or 3 about other agents and their stories. There is always one major takeaway Additional benefits are the Journal of Personal Finance and multiple White Papers... and I love the discounts for services I use. There are so many benefits that it’s hard to hit them all. Mostly, I love being a part of a highlevel Association, being able to network with other professionals, and learn from highly experienced consultants, Board Members, etc… Register: So, when the business persona leaves the office, what does family and recreational life look like to Jeremy? Jeremy: I have a blessed life, when I’m not in the office, I spend time traveling with my beautiful wife – the backbone and my left hand for 26 years. I bowl tournaments and leagues, kick back, and play video games and board games The Register | Fall 2023
US Chapter
Member Benefit
Incentive Program $$$$
Available from 7/1/23 through 12/31/23
Risk Tolerance Technology SmartRisk is the best solution for advisors to properly align their client’s risk tolerance with the actual risk in their portfolio. We believe a solid risk discussion is the central element of behavioral coaching, which multiple studies have quantified as delivering Advisor Alpha upwards of 1.5% annually. SmartRisk technology utilizes heavy-tailed risk models and a unique asset interaction report that ensures you have the best insights available to advise your clients. SmartRisk is powerful technology that serves the needs of advisors.
Discount 20% (877)844-7213 sales@covisum.com
Members Who Refer a Prospect that Joins Would Receive... 1
2
3 or More
New Member
New Members
New Members
$100 Cash
$100 Cash
$100 Cash
+$25 off webstore
+ $50 off webstore
expires within 6 months
expires within 6 months
IARFC Attn: Membership Services Fill out the P.O. Box 506 form below Middletown, OH 45042 & return to: Email: info@iarfc.org Fax: (513) 345-9479 Phone: (800) 532-9060
Access Fillable PDF form:
__________________________________________________________________________________________ First Name Middle Name Last Name Prefix
Mr.
Ms.
Mrs.
__________________________________________________________________________________________ Address __________________________________________________________________________________________ City State Zip Code __________________________________________________________________________________________ Phone Email Recruited by_______________________________________________________________________________ Phone_____________________________________________________________________________________ Email______________________________________________________________________________________
The Register | Fall 2023
Page 21
Are You Holding Yourself Accountable to Your Clients and Prospects?
As financial professionals and members of the IARFC, we are part of a great financial services industry. No other industry can do more to help people with their finances than we can! No other group of professionals can do more to help people protect their families, solve their problems, and make their dreams come true. As advisors and consultants, we can help people manage their money better. We can help people to buy their first home, fund a college education, reduce income taxes, minimize debt, and more - while they protect the people they love.
how can you be sure the product you recommend is the best for their family right now?
Help People Understand Their Entire Situation!
The only way to make sure you do what is best for your client is to take the time to do a full fact-find. That means asking them more questions about their entire situation. What do they want now? What are their concerns today? What worries them the most? Why is this important to you? How do you feel about that? Are you planning on your children going to college? When would you like to retire? What do you want to do when you retire? These are just a few questions you will need to ask people! Are you listening to what people are telling you? Are you then asking more clarifying questions?
Unfortunately, very few of our members are doing everything they should to help people. Most of them are focused on selling one or maybe two products. Some people are only selling investments. Others only sell mortgage insurance. Others may only sell longterm care insurance. They are only solving a problem they think their client has. They are not helping people to see their entire situation, to find out what is most important to them - the client. If you are not taking the time to understand your client’s entire situation, concerns, problems, and dreams, then
Do you want to be sure you recommend the best product(s) for their family right now? Then take the time to do a better fact-find to help people understand their entire situation.
When was the last time you had a real conversation with people? Are you helping people understand what is important to them and their families so they will want to set better priorities?
Most advisors and consultants only ask a few related questions concerning a product they want to sell to the client. Once they ask those questions, they begin to sell their product. But, is it the right sale for the client? In most cases, are you missing the best way to help people?
Help People Find the Money to Fund Their Priorities!
Page 22
Help people to solve problems and make their dreams come true. This is how you will build long-term personal relationships with your clients and gain their trust. It is how you will make more sales in the home. It is also how you will get referrals from clients without asking!
Most people out there are living for today. They have not thought a lot about their future. Accordingly, they spend a lot of their money in the wrong places. The Register | Fall 2023
Once you have helped people set their financial priorities, you will want to help them prioritize the money they spend. Can you help people to reduce their debt? Can you show them how to reduce the cost of their homeowners and auto insurance or reduce the cost of their cell phones? Can you help people to refinance their homes to reduce their mortgage payments? Are they paying extra on their mortgage to pay it off early? Would it be better to use that money to save for college or retirement? Are they buying term insurance and investing the difference? Would it be better to use that money to buy cash-value life insurance?
The best part is the more you help people find the money to fund their priorities, the more money you will make and the more future sales you will make when you do an annual review. You will also get a lot of client referrals without ever asking for them because people will tell their friends and family how much you have helped them. You will set yourself apart from everyone else that is just selling products. Another benefit of focusing on helping people - you will need to see fewer people. When you help people find the money, it is easy to fund $500 or more per month into life insurance. This life insurance can also help fund a college education and a tax-free retirement. Remember, as financial professionals and members of the IARFC, our first obligation to our clients... is to help them protect the people they love!
Note: Families should not risk money in the stock market they can’t afford to lose!
Summary The more questions you ask and listen to help people set their financial priorities and fund their priorities, the more they will like and trust you, see you as a Trusted Advisor, and follow your recommendations! As financial professionals and members of the IARFC, we must help people find the money to spend, save, invest, insure, and plan wisely for the future so that they can Live Debt Free and Truly Wealthy!
Take Advantage of Building Power Member Benefits! IARFC members receive discounts with AT&T, Office Depot, Hertz, First Data, WEX, YRC Freight, HP, MyAutoLoan. com, Costco, PetsBest and Clever RX.
Are they investing in mutual funds? Would they be better off in a fixed or indexed annuity to reduce risks and save them on income taxes?
Where else can you find the money to help people to fund their financial priorities?
10 Member Benefit
Jeremy Nason, RFC® Jeremy B. Nason, RFC® is the cofounder of the Insurance Pro Shop™ Helping Average Agents Become Elite Advisors. Since 1999, Jeremy and his Team have helped 1000’s of financial professionals to increase their incomes exponentially, while helping them consistently qualify for Million Dollar Round Table, Court, and Top of the Table. Contact: (877) 297-4608 Outside USA +1-770-443-2852 jeremy@insuranceproshop.com www.insuranceproshop.com
Missed the Summit?
The program is simple to use, click here to read more about the new discounts available as a IARFC member. Members who have any questions or need assistance getting started, can contact wendie@buyingpowerusa.com. Member Link: http://www. buyingpowerusa.com/iarfc/ Contact Person: Wendie Henderson Phone: (713) 579-9647 Email: wendie@buyingpowerusa.com
Use Your Member Discounts
Sign up with Charlotte@iarfc.org. We will notify you when it is released on the IARFC Store. The Register | Fall 2023
Page 23
IARFC Chapter Connections My viewpoint.... Barry L. Dayley, MRFC® - IARFC Trustee Chair In my recent visit to many chapters in Asia, I was impressed with the behavior and culture of our RFC’s in many countries. Consider the following … Picture this: a commencement ceremony in Manila Philippines where a group of new Registered Financial Consultants, who had just received their diploma and the right to use the RFC designation, standing together reciting the IARFC Code of Ethics. This was impressive but is indicative of the commitment of the Philippine Chapter to the high standards and Code of Ethics of that the RFC designation marks. To them, it’s a “way of being”, not just talk. In Haikou, China, while attending the IDA Annual Conference, I was impressed with the classy emphasis on building up people and encouraging participants to follow high professional standards. At the conference there were hundreds of RFC’s, members of the Greater China Chapter, who were proudly demonstrating their commitment to the RFC standards. Two weeks later at another IDA Conference in Taiwan, there was a session with three successful women communicating the virtues of the RFC designation and its impact on their business. Team building, a culture of sharing, greater self-confidence, enhancement to their brand, improved production, and professionalism, are the results of having team members earn their RFC. It helps them to “be” a better financial consultant and businessperson which enhances their success. In Hong Kong, I witnessed a group of nine individuals receive their Master Registered Financial Specialist (MRFS). The first in history! Very impressive! This shows a commitment to the financial planning profession at the highest level. In the Hong Kong / Macau Chapter, they want to “be” the best they can for their clients as they lead them through the complex maze of financial confusion to successfully achieving their goals. Under capable leadership in the Indonesia Chapter, the RFA and RFC ranks are growing at a rapid rate. In a recent commencement, there were 28 graduates who earned the RFA or RFC designation. These professionals show a commitment to continued education and high ethical standards which is not only improving recipients personally but is also raising the image of the financial planning movement in Indonesia. Way to “be”! Let us follow the leadership of these chapters and members by embracing these standards ourselves. I’ll do it if you will, and we can all do it together! We should not only do it for ourselves, but for the profession, and most of all, for our clients. We can truly “be”, A Growing Global Community making a difference!
Philippines
IARFCPH 2023 Ambassador Awards Presentations
IARFCPH Forum and Conferment.
IARFCPH 2023 Graduates!
Aug.12, 2023. 1-5pm. Makati Sports Club Catch the events on IARFCPH YouTube Channel
Page 24
The Register | Fall 2023
Hong Kong/Macau Congratulations to First MRFS Class of Graduates! Mr. Eugene Lam, RFC®, MRFS • Ms. Ann Fok, RFC®, MRFS Mr. Ian Chan, RFC®, MRFS • Mr. Andy Kung, RFC®, MRFS Mr. Ricky Ko, RFC®, MRFS • Ms. Sally Yeung, RFC®, MRFS Mr. Alex Shum, RFC®, MRFS • Dr. Hugo Chan, RFC®, MRFS Mr. Thomson Liu, RFC®, MRFS • Mr. Roy Cheuk, RFC®, MRFS Mr. Maurice Ip, RFC®, MRFS • Mr. Sek-Lun Au, RFC®, MRFS
the Peace an, Justice of asury Mr. Joseph Ch cial Services and the Tre gion Finan for y tar ministrative Re cre Se Under ng Special Ad Ko ng Ho of the China t of en c nm bli pu ver Re Go The People’s ker Keynote Spea
Dr. Hugo Chan, RFC®, MRFS, Chairman of the Board of Directors, IARFC Hong Kong and Macau Center Company Limited (left) Mr. Barry L. Dayley, MRFC®, Trustee Board Chair, IARFC ( right) il Chan ce Professor Em Digital Finan Hong Kong Professor Co-Chair of BA Adjunct EM & n tio Kong Associa rsity of Hong of City Unive ker Keynote Spea
r ung, Directo l Education Dr. John Le siona and Profes ing inu nt ng Kong Co rsity of Ho Institute of Seng Unive eaker The Hang Keynote Sp
Ms. Sally Yeung, RFC®, MRFS, conferee representative sharing her advancement experience
, Chairman, , RFC®, MRFS Dr. Teresa So and Macau, IARFC Hong Kong al words r motivation Delivered he
Dr. Teresa So, RFC®, MRFS, Chairman, Hong Kong and Macau, IARFC (left) and Dr. Thomas Man, Associate Dean (Enterprise and Business Engagement), School of Business, The Hang Seng University of Hong Kong (right)Presented a souvenir to Dr. John Leung, Keynote Speaker (center)
Dr. Teresa So, RFC®, MRFS, Chairman, IARFC (left) and Dr. Thomas Man, Associate Dean (Enterprise and Business Engagement), School of Business, The Hang Seng University of Hong Kong (right) Presented a souvenir to Professor Emil Chan, Keynote Speaker
The Register | Fall 2023
IARFC- Hong Kong/Macau - Mr. Allan Wan, RFC®, Executive Director - Mr. David Lai, RFC®, Vice Chairman of Member Development Commi ttee - Ms. Anita Yiu, RFC®, Member Development Committee Mr. Alex Shum, RFC®, MRFS, Chairm an of Member Development Committee - Mr. Barry L. Dayley, MRFC®, Chair of the Board of Trustees, (IARFC Headquarters USA) - Dr. Teresa So, RFC®, MRFS, Chairman Ms. Rosanna Yu, RFC®, Vice Chairman of Member Development Committee Mr. Roy Cheuk, RFC®, MRFS Membe r Development Committee - Mr. Eugene Lam, RFC®, MRFS, Member Development Committee Ms. Ada Ho, Assistant Administration Manager
Page 25
China/Taiwan 2023 IDA International Dragon Awards Thousands Asia-Pacific financial and insurance elites gather in Haikou and Taipei for the highest honors one can receive in the World’s Chinese financial and insurance industry.
Kai Yuan Tu, RFC® translating for Trustee Chair Barry L. Dayley, MRFC® during presentation in Haikou
2023 IDA Conference Haikou, China
2023 IDA Conference Taipei, Taiwan
IARFC Trustee Chair Barry L. Dayley, MRFC,® Dr. Sanjay Tolani (recent IARFC Summit Presenter), Soloman Hicks and Trustee Kai Yuan Tu
IARFC Greater China Development Chair Liang, Tien Lung, RFC® Greater China Chapter Team with Trustees Barry L. Dayley, MRFC® and Kai Yuan Tu, RFC®
Page 26
The Register | Fall 2023
Indonesia
Main Event , Graduation Ceremony for RFC®, RFA®, RIFA, CIMM, CIS, CMFC. Diraja Hotel, Jakarta
IARFC Barry L. Dayley, MRFC® and Indonesia Chapter President Aidil Akbar Madjid, RFC® doing a talk show with a dialogue format about the “Future of Financial Planning”
Goodbye selfies at Soekarno Hatta Int Airport
Signing of the MOU with APSEII. (an Association of Islamic study programs from 31 universities spread throughout Indonesia
Barry and the IARFC Indonesia Team visited the Indonesian stock exchange
Vietnam Though not a Chapter “officially”, representatives from Vietnam visited with IARFC Trustees during a trip to Asia.
The Register | Fall 2023
(L-R) Dr. LO, Frankie Chu Fai, RFC®, Trustee Chair Barry L. Dayley, MRFC® Mr. Otto So, RFC®, Trustee Kai Yuan Tu, RFC®
Page 27
Tax-Advantaged Exit Strategy
for Large IRAs To quote Ed Slott, the Nation’s #1 authority on IRAs and IRA tax planning: “IRAs are different. They’re tax liabilities unlike any other. An IRA is an IOU to the IRS.”
someone in the 37% top marginal bracket would be protected from $370,000 of total loss.
Effective 1/1/20, SECURE Act became law; followed by SECURE 2.0 on 1/1/23, among other things, imposing new draconian tax consequences for passing large IRAs to heirs.
1. Few films fare so poorly that 100% of the investment is lost.
Financial planners traditionally recommend the following solutions: 1. Convert IRA to Roth, pay the taxes, then allow the Roth to grow tax exempt. 2. Live off the IRA as income. 3. Make (tax-free) Qualified Charitable Donations – which remove the IRA from the owner’s account and are limited to $100,000 per year after age 70½. None of these strategies eliminate an IRA on a no-tax-due basis and allow the owner to retain possession of the IRA funds. However, there is a way for the owner of a large IRA to get out from under it entirely lump sum – on a net zero-tax basis and still retain ownership of the money, but it comes with some strong caveats and is NOT for everyone. Section 26 U.S. Code § 181 of the Internal Revenue Code is a provision for the Treatment of Certain Qualified Film and Television and Live Theatrical Productions. In essence, this provision allows an investor in a qualified film project to declare the entire sum invested as a deductible capital loss starting the year the investment occurred. Traditionally, the value of Section 181 is to offer protection against loss should the film project fail to return the investment, but functionally that is only equal to the same percentage of the investor’s applicable tax brackets. For example, an investment of $1,000,000 by Page 28
Having said that:
4. For most people, the schedule of RMDs will NOT result in overall reduction of the IRA until they reach their early to mid-80s. That means the size of the RMDs continually increases, potentially impacting how much Social Security is taxed, potentially increasing the cost of Medicare Part B premium, by as much as 360%.
2. Many films receive financial perks such as state film incentives, product 5. At inheritance, most beneficiaries are placement dollars, etc., that mitigate subject to a 10-year liquidation potential loss to an investor. mandate – all taxes due – with a lot of complexities in mandatory distribution 3. Nobody should invest in a film that schedule – and severe penalties for lacks a Completion Bond which protects mistakes. investors against loss because the film was never completed. In other words, large IRAs can be an unequivocal tax nightmare. 4. Finally, film investing is well known to What Section 181 offers is an avenue for be risky and film investors expect to be high net-worth investors with large IRAs adequately rewarded for their risk by to escape the tax liability of these strong return expectations, the terms of accounts on a net tax $0 basis. which are clearly defined by contract. There are 3 important caveats: ENTER THE PRETAX QUALIFIED ACCOUNT: 1. The prospective film investor MUST be an Accredited Investor defined as an As already noted, anyone with a large individual with either: 1) Over Pretax Qualified Account (e.g., IRA 401(k), $1,000,000 in net assets, or 2) Gross 403(b), 457, etc. – not Roth) has a income exceeding $200,000 individually formidable future tax liability. or exceeding $300,000 joint income with either a spouse or domestic 1. With limited exceptions, ANY partner. withdrawal from an IRA is taxable as ordinary income at the applicable 2. The investor MUST be not younger marginal tax bracket – including a higher than 59½, otherwise, a 10% tax penalty bracket should that withdrawal result in will apply to the withdrawal and that crossing a tax bracket threshold. penalty will NOT be offset by the 181 deduction. 2. Starting at a Required Beginning Age (RBA), distributions are mandatory: 70½ 3. The Film Production MUST spend all prior to January 1, 2020; then 72 the investment from IRA in the SAME effective January 1, 2020; then 73 tax year as the investment. Otherwise, effective January 1, 2023; and 75 for there WILL be a taxable report which those who turns 73 on or after 1/1/2033. cannot be offset dollar-for-dollar by the 181 Deduction – and there is no 3. Those Required Minimum Distributions allowable “retroactive” deduction for (RMDs) become progressively larger last year. (based on the Uniform Life Table) each year throughout life.
The Register | Fall 2023
Otherwise: 1. The investor withdraws funds from the IRA. This generates a taxable report (Form 1099R) on the IRA liquidation with taxes due by the tax filing deadline (e.g., April 15) for that tax year. 2. The investor then invests that same sum in the film and reports a tax loss (under Section 181 for the entire sum. The declared loss is a dollar-for-dollar offset of the taxable income from having liquidated IRA funds. The result is a net $0 tax bill. This concept is comparable to offsetting capital gains on investments with capital losses to negate exposure to capital gains taxes on the sale of the appreciated assets. 3. Later, if/when the film returns the investment, those receipts are reported as ordinary taxable income. However, from that point onward, the money is Non-Qualified meaning: a. There are no RMDs for anyone. b. The principal (basis) is now not taxed. c. Gains are taxed at lower Long-term Capital Gains rates. d. It receives a step-up in basis upon inheritance. e. Has no mandate for an heir to empty the account. The potential argument that the tax liability to the investor (as income) is the same as the taxable report from liquidating the IRA misses an important mark. Using this manipulation effectively converts the IRA into non-IRA and even though the funds are ultimately taxable (as income), it spreads the taxes out based on future profitability of the film. As such, while there is a return of the funds as taxable, they now get to enjoy the possibility of future growth as long-term capital gains (for the investor) and then enjoy a step-up in basis (not taxed and no 10-liquidation mandate) for heirs. Moreover, by not reducing the size of the IRA, means it continues to grow (as an IRA) until the start of RMDs which will also substantially grow, thereby greatly increasing the aggregate tax due. For example, assume a 60-year-old has a $5 Million IRA, growing at 7% per year, that account will have ballooned to nearly $14 Million and have a first year RMD of well over $500,000. If that person lives to age 90, then the IRA is inherited, that initial $5 Million IRA may have generated aggregate tax bills (taxes paid, not distributions reported) of $15-$20 Million! Conversely, if the IRA is The Register | Fall 2023
eliminated under this plan, the total tax load from RMDs is $0. Even assuming the invested $5 Million returns $10 Million as income, the total tax due (at 37%) on all that income is $3.7 Million!
Member Benefit
In other words, based on this scenario, the 181 manipulation would have resulted in a total tax savings of over $11-$16 Million; 2 to 3 times what the initial IRA was even worth. Final Word: For this strategy to work, a prospective investor MUST coordinate with a professional film production company that is producing a Section 181-Qualified Film. Despite the advantages highlighted here, film production (and film investing) are very complex endeavors which under no circumstances should be contemplated by anyone who is not very well connected with and/or skilled in the film industry. There are numerous subtle legal requirements that must be adhered to. Of course, there is no moratorium exploring possibilities and asking questions. But anything beyond that, without the full complement of necessary requirements, is very illadvised. Note: any prospective investor using this strategy needs to be a resident of a state with no state income tax applied to the liquidation of qualified funds. Otherwise, that investor could be exposed to state income tax that cannot be recovered through the outlined strategy.
Michael Tove, RFC®, CEP® (919) 971-8699 info@emeraldoakproductions.com Michael Tove, RFC®, CEP® is a financial advisor and investment advisory representative affiliated with CoreCap Advisors, LLC. He is also an independent film producer and manager of Emerald Oak Productions, LLC. His film credentials may be viewed on IMDb. CoreCap and Emerald Oak Productions are completely separate and unaffiliated businesses. CoreCap has no connection with and nothing to do with any aspect of filmmaking including investing therein.
Automated Marketing Platform for Financial Professionals FMG Suite is the industry’s leading automated marketing platform for financial professionals providing an all-in-one integrated suite of marketing tools. It creates a standout online presence with beautiful websites to connect with clients and attract new business through their evergrowing, FINRA-reviewed video and article content library, automated email and social media campaigns, and lead generating, gated content. IARFC Members will have access to several FMG Suite products, including: • Websites • Automated Email and Social Media Campaigns • Gated Content • Presentations • Custom Email Builder • Custom Social Media Scheduler • Website Copywriting • Video Live
Discounts on Monthly Pricing (discounted to $149/mo) and Website Design Service www.fmgsuite.com/contact (858) 251-2400
Page 29
Ascend the Stereotype Become a Master Registered Financial Consultant App Nowly !
5 9 . 9 7 $ g and
hippin
plus s
Prepare for the MRFC® Exam Exam Study Guide In Stock Contact Membership Services
g andlin
h
The MRFC Exam Study Guide is now available for those who wish to take the Master Registered Financial Consultant (MRFC®) Exam. Presented in a condensed outline format and designed for the professional in mind who has limited study time, the Study Guide addresses every task of the MRFC Blueprint Exam Content to help you focus on exam topics. These are tasks derived from the most current 2021 MRFC Job Task Analysis. Features 300 pages After topic questions for comprehension Easy to read, outline format Organized by Blueprint tasks
Page 30
Published by
Note: The Study Guide is produced by the IARFC which is independent of the MRFC Certification Program. The Register | Fall 2023 Purchase of the Study Guide is optional and not a requirement to take the MRFC exam and does not guarantee a passing score on the Exam.
IARFC Member Benefits O u r S t r a t e g i c A l l i a n c e s A f f e c t Yo u r B o t t o m L i n e The Association continually seeks and forms alliances with other organizations and businesses to provide members with discounts for services and products necessary to their practice. Members can log into their IARFC membership profile for a complete listing and more explanation. • • • • • • • • • • •
Advisor Controls (discount of $20.00 per month) BuyingPower AT&T, Office Depot (discounts up to 50%) Copytalk (discount of $20.00 per month) DACFP (discount of 20%) EP Navigator (discount of 25%) FMG Suite (discount of at least $20.00 per month) Group Insurance Benefit (highly affordable Group Rates, Open Enrollment for new members) Income Insight (discount of 20%) Kwanti (discount of 10%) MoneyGuide ($300.00 off the Pro and Elite version) MyRepChat (discount of $15.00 per month)
The Register | Fall 2023
• • • • • • • • • • • •
Redtail Technology, Inc. (discount of 10%) RightCapital (discount of 10%) Riskalyze (discount 10%) Selling without Wrestling Smarsh Archiving (discount of 10%) SmartRisk (discount of 20%) Social Security Timing (discount of 20%) Success CE (“Package Pricing” of $29.95) Tax Clarity (discount of 20%) The Business Source, Concise summaries of books (70% off) Totum ($100.00 off the Pro Plus annual subscription) VSA (discount over 16%)
Page 31
Page 32
The Register | Fall 2023
more credence to their successes than their failures. • Even if the stock market is in terrible shape, your client knows you are doing your best. They will put up with lessthan-ideal performance if they feel you are on top of things. (This will generosity will not last forever, though.) This is an ideal time to focus on the The Joy of Delivering Accountability to Clients •big picture, making sure to remind them to continue adding money on Many friends would make great clients. The stock market rarely moves in a straight line. Financial commentators on TV often seem to give conflicting advice. Even regular newsreaders add to the confusion. The DJIA does not go up or down. It soars or plunges. Your friends know what you do for a living. You always seem so calm. They know they would benefit from professional advice, yet they have not said: “Will you help me handle my money?” Something is holding them back. Accountability is the answer.
What is holding them back? It is the risk to the friendship. They place a high value on your shared relationship. They are concerned if the relationship moved from solely social to one combining the social relationship with a business relationship, they are asking for trouble. They worry if the business relationship went south, they would lose a friendship in the process. Has a friend ever declined to become a client because “You can’t fire friends?” You have added several good friendships with people who started as business relationships. Everything has proceeded smoothly for years. If a client can become a friend, why is moving in the opposite direction friend to client, so difficult? Accountability Is the Solution to the Friendship Dilemma. When I was in production, I faced the same dilemma. Here is the solution that worked for me. I would explain: “If you become my client and follow my advice, you should get a report card. If I am doing a lousy job, you should be able to fire me.” That might sound crazy to say. Why should I be talking about the end of the relationship before it even starts? The reason is accountability. The role of stockbroker probably dates back to 1602 with the opening of the Amsterdam Stock Exchange. (1) Woody Allen had a great line in one of his films: “A stockbroker is someone who invests other people’s money until it is all gone.” (2) Many people consider financial advisors as The Register | Fall 2023
stockbrokers under a different name. This includes some of your friends. They think a stockbroker suggests stocks and if you lose money, you never hear from them again. By introducing accountability, you are changing the dynamic.
Your periodic portfolio reviews are the report cards. You are standing behind your recommendations. “Here is what I suggested, and this is how we did.” Clients love that. Performance is not as simple as trying to outperform the indexes, which is close to impossible. Why? You cannot compare your client’s performance to the S&P 500 index (a 100% equity index) if they are 60% stock and 40% bonds. You would need to create your own blended index, appropriate for this client. The Family Index concept makes more sense. What return do they need to achieve to reach their goals? If the goal is distant, like retirement for a younger investor, the number to beat might not be that high. This means you might take less risk. It also means if you outperform the Family Index for a few back-to-back years, you can recalculate going forward, meaning you take less risk as the client gets older. The drawback to this strategy is the annual return needs to be positive. If it is negative or below the Family Index number, you need to recalculate going forward, resulting in a higher future target. You will likely discover a few good things when you conduct these report card reviews on a regular basis. • Your client will hold you in high esteem because you stand behind your recommendations. You do not attempt to evade responsibility. • If you own a couple of dozen stocks, even in a difficult market, something is working out. Investors are often optimists. They often give
schedule.
• They are an ideal referral scenario, because they can tell their friends how you are accountable. Let us return to the “you can fire me” scenario. How does accountability get your friend past the “risk to friendship” objection? They are worried if things do not work out and they part company, the friendship is over. They might tell themselves they need to stay in a bad situation because they do not want to lose the friendship. Now that has changed! You provided a roadmap to unwind the relationship! “If I am doing a lousy job, you should be able to fire me.” They can see the exit sign. They are able to avoid any guilt feelings because the roadmap to unwind the relationship was your idea. Clients like accountability because it addresses a shortcoming often associated with some stockbrokers who did not keep in touch with clients when investments did not work out. Woody Allen got it right. (1) https://en.wikipedia.org/wiki/Stockbroker (2) https://quotefancy.com/quote/949703/ Woody-Allen-A-stockbroker-is-someone-whoinvests-other-people-s-money-until-it-is-all
Bryce M. Sanders Bryce Sanders is President of Perceptive Business Solutions Inc. He provides HNW client acquisition training for the financial services industry. His book, Captivating the Wealthy Investor is available on Amazon.
Contact: (215) 862-3607 brycesanders@msn.com www.perceptivebusiness.com Page 33
Working Collaborations CPA and FINANCIAL CONSULTANT
Accountants are black and white with rules: tax rules, accounting rules, basically a book of rules to go by. The consultant is a risk taker who makes recommendations to the best of their ability that are not guaranteed. Starting out as a CPA meant I spent my early years doing tax returns - lots of them. I could hide behind the meticulous spreadsheets filled with reliable and comfortable numbers that extracted predictable results. But, since I was so into expanding and keeping my client base, I looked for ways to enhance my relationships with my clientele. As a CPA, I saw the need to get acquainted with the financial consulting/investment side. I soon realized I had to start selling myself and my overall financial services to already existing and future clients. Most of the time though, the accountant is not comfortable with sales, a skill set that needs to be honed. From a communication standpoint, we talk a different language. The CPA speaks in “numberese” - consisting of facts and statistics that bring peace of mind. Accountants have never been really taught how to sell, so I sought out and took advantage of an insurance professional. Having this type of mentor introduced me to the art of doing “needs-based” selling. This mentorship and training led to me become a “Master of the Middle Class” - with a client base of $50,000 to $750,000 individuals. I found that their needs were different than HNW people. Additionally, they were extremely grateful for the services that I provided. This was a comfortable niche for me. They were mostly interested in: (1) Protection - wills, insurance: life, disability, umbrella (2) Education - making sure their kids to get through college without going broke. (3) Growth - being able to retire comfortably. When I first began taking on the additional role of an RFC, I realized I had to appeal to these emotional differences. The accounting side already was making money, the emotional appeal was a different kind of approach. As time passes, there has been nothing more rewarding than having clients stay with me for 30-40 years, because I paid attention to their protection needs and went beyond the facts and figures. Page 34
From my experience in the dual roles, there are some basic understandings as to the role of each professional. When the accountant brings in another such person, they face a no-win situation. If the investment advisor or consultant is successful, they get the credit. If it does not work out, the CPA gets the blame. That is why CPAs are hesitant to partner. I have found if the relationship is going to last for the long haul, the CPA has to be licensed so they can share in a commission. Those have been the only relationships that have successfully held up through time. Competitiveness is avoided if both professionals are rewarded. Economic jealousy can set in if both are not sharing the commission. As a consultant however, I always controlled the narrative and never let the client meet with the CPA alone. And if I did not feel results weren’t appropriate for the client, it would not be presented. My two main “best practices are: (1) Become totally involved with the process. I do not just turn over clients. Make sure things are right for the client. (2) Make sure accountants are fully licensed and involved with the process that is best for the client. My formula is working wonderfully. Unbelievably I have 3 clients who were my first tax returners over 47 years ago.
Joseph Jacques, RFC®
Contact: (301) 738-1303 www.jacquesfinancial.com
Mission: “To provide my client the highest level of service with a personal touch.” The Register | Fall 2023
Nominations for IARFC Founder’s Award 2024 Criteria for Founder’s Award • • • • • •
Past or present Board Director, Officer, or Committee Member Professional designation or credential awarded by the IARFC Clean regulatory record Member of good standing for a minimum of 5 years Adhere to IARFC Code of Ethics Most importantly, they must have contributed to the growth of the IARFC membership by referring members and by holding or attending events that additionally help expand (above and beyond) the visibility of the Association.
Nominations Accepted From: IARFC members: RFA®, RFC®, RFC® Retired, or MRFC®. Nominations Procedure: Fill out this form and on a separate sheet of paper and explain why the nominee should be considered for the Founder’s Award. Submissions are due by November 30, 2023 Nominee: (print or type information below) ____________________________________ First Name
_____________________________________________________________________________ Last Name
___________________________________________________________________________________________________________________ Firm or B/D ____________________________________________________________________________________________________________________ Street Address __________________________________________________________________ ____________________ ___________________________ City State Zip ________________________________ __________________________________________________________________________________ Phone Email
Nominator: (print or type information below) ____________________________________ First Name
_____________________________________________________________________________ Last Name
________________________________ __________________________________________________________________________________ Phone Email
IARFC
Ways to send in a Nomination for the Founder’s Award Mail this from to: IARFC Founder’s Award P.O. Box 506, Middletown, OH 45042 Founded in 1984, the IARFC fosters and enhances the growth of our Fax: (513) 345-9479 Association for the benefit of the members and the clients we serve by Email: awards@iarfc.org providing a continuing source of information, education and networking. The IARFC will strengthen the financial services profession through Questions: (800) 532-9060 adherence to and promotion of ethical behavior by our members and focus on their continuing professional education. INTERNATIONAL ASSOCIATION OF REGISTERED FINANCIAL CONSULTANTS
The Register | Fall 2023
Page 35
P.O. Box 506 Middletown, Ohio 45042
IARFC National Financial Plan Competition
ponsors
rate S 2024 Corpo