How the PILLAR System is Designed for Seasoned, Successful Financial Professionals

By: Charlie Gipple, CLU®, ChFC® 
Senior VP of Sales and Marketing, Partners Advantage

The Partners Advantage PILLAR System (Partners In Life, Long-term care And Retirement) is a system that packages all of the proven content that I have tested throughout my career, that Partners Advantage has tested, that MDRT-level financial professionals have taken from us and tested, and brings it all together to help financial professionals who work directly with Partners Advantage deploy this content to generate more sales. It is a client education system, a seminar system and also a complete sales system.  

Here's how it is designed to help top financial professionals. First, the PILLAR System material covers the spectrum from simple to complex.  The complex being more aligned with the needs of top financial professionals.  This material covers topics such as behavioral finance and how to overcome some of the 117 biases that may exist in the consumer’s mind. It also covers educational information on how indexed products are hedged and how insurance companies approach the overall process. It covers advanced sales strategies, legacy planning, and many other areas.

Secondly, it provides world-class client-facing material, all of which has been professionally created for you. This is nice because the top professional doesn’t always have time to create important educational materials.  This system provides it.

A third key point is that many of the best financial professionals I have known are great at speaking with clients one-on-one.  But, I do know a few that are not great in front of a room full of people.  For these financial professionals, if they can fill a room, I would volunteer myself for speaking with their clients in a seminar or one of our great speakers at Partners Advantage.

The fourth key to this system is accountability.  I used to use a personal trainer.  I didn’t use this personal trainer because I thought he knew more about lifting weights than I did.  I used him because of accountability!  When you have somebody you are accountable to, you tend to perform very well.  We want to be your accountability coach as well.  Regardless of how motivated an individual is, there can always be an accountability coach.

There is much more you need to learn about the PILLAR System and what it can offer you. Contact your Partners Advantage Brokerage Director today, to ask for more information: 888-251-5525, Ext. 700.


For financial professional use only. Not for use with consumers.

*Production results gathered from January-June 2016. Not all financial professionals in attendance experienced the same results and there is no guarantee of future success. The information provided is for your own practice management purposes and education.

The third party information and opinions included in these presentations have been obtained from sources believed to be reliable, but accuracy and completeness cannot be guaranteed by Partners Advantage. Although we may promote and/or recommend the services offered by these companies, financial professionals are ultimately responsible for the use of any materials or services and agree to comply with the compliance requirements of their broker/dealer and registered investment advisor, if applicable, and the insurance carriers they represent.

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Years of Testing and Proven Sales Results - Lead to Unveiling of the Partners Advantage PILLAR System

By: Charlie Gipple, CLU®, ChFC® 
Senior VP of Sales and Marketing,
Partners Advantage

The PILLAR System is coming! PILLAR is an acronym for: Partners In Life, Long-term care And Retirement.  It is a full system of professionally designed, client-ready materials and training to explain how to make it work for you. In short, this is a vehicle (a package) that takes all of the PROVEN content that I have tested throughout my career, that Partners Advantage has tested, that MDRT-level financial professionals have taken from us and tested, to help financial professionals who work directly with Partners Advantage deploy this content to generate more sales. It is a client education system, a seminar system and also a complete sales system.  

The PILLAR System was developed as a result of an epiphany I had on an airplane when I was analyzing some hugely successful sales results that we have experienced in 2016. While analyzing the numbers, I realized the education we provided to the financial professionals though our eight-hour road shows created really impressive results!  The data shows that financial professionals increased their annuity business by 72% shortly after the road shows and their linked benefits business by 143%.  I was also looking at numbers on client seminars that I've done for some of our top financial professionals that said the seminars were getting 60%-80% appointment ratios.  So, in short, I realized, and I already knew, that what we do at the financial professional level works and what we do at the client level works.  We know the training for financial professionals works and the client materials work, so how do we connect the two together? We created the PILLAR System to do this - Partners In Life, Long-term care And Retirement. This proprietary system brings it all together and it is only available to financial professionals working with Partners Advantage. This system is, packaging world-class content in an easy-to-use format all the way from educating yourself as a financial professional to deploying that content with your clients.

Stay Tuned...the PILLAR System is coming early in 2017!

For financial professional use only. Not for use with consumers.

*Production results gathered from January-June 2016. Not all financial professionals in attendance experienced the same results and there is no guarantee of future success. The information provided is for your own practice management purposes and education.

The third party information and opinions included in these presentations have been obtained from sources believed to be reliable, but accuracy and completeness cannot be guaranteed by Partners Advantage. Although we may promote and/or recommend the services offered by these companies, financial professionals are ultimately responsible for the use of any materials or services and agree to comply with the compliance requirements of their broker/dealer and registered investment advisor, if applicable, and the insurance carriers they represent.

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Serving Clients with Estate Planning Needs

As we head toward the end of 2016 and prepare for 2017, we wonder how the estate planning environment might change. There is even some pressure to abolish the Federal Estate Tax.  Regardless of where we stand on this issue, one thing remains and that is the federal deficit. The issues are complex, however, the chances of adopting any measure that significantly cuts tax revenue is slim. So, let's assume the current $10,900,000 portable unified gift and estate tax exemption will stand unchanged.¹

How do we effectively help clients with estate planning needs? If we are to be the catalyst sharing ideas and bringing them to fruition, the process is still paramount. As we approach the end of 2016 it is more important than ever. In my work in this space I see cases sometimes fail because the correct process is ignored. You might get lucky and stumble upon an already developed case and make a product sale.  This is neither a sure or consistent entry into the market. 

Start with Fact Finding
The successful process begins with in depth fact finding. There are many great estate planning fact finders from carriers and other sources. They all have one thing in common. They guide you in asking the disturbing questions about estate reduction. They uncover client goals and dreams, for example do they want their children treated fairly or equally. Most importantly, they contribute to developing rapport with the client. Then, when you request all those private financial documents from your client or ask for a meeting with one of their other advisors, the client's answer is yes. I see more cases fail for lack of this step than for any other reason.

Learn how detailed fact finding, teamwork, and new alternatives available to insurance professionals can make a significant difference to affluent families during the largest wealth transfer period in history.  

Fill out my online form.

¹Source: https://www.irs.gov/businesses/small-businesses-self-employed/estate-tax  

For financial professional use only. Not for use with consumers.

Policy loans and withdrawals will reduce available cash values and death benefits, and may cause the policy to lapse or affect any guarantees against lapse. Additional premium payments may be required to keep the policy in force. In the event of a lapse, outstanding policy loans in excess of un-recovered cost basis will be subject to ordinary income tax. Tax laws are subject to change. 

Partners Advantage Insurance Services and their representatives do not give tax or legal advice.  Accordingly, any tax information provided is not intended or written to be used, and cannot be used, by any taxpayer for the purpose of avoiding penalties that may be imposed on the taxpayer. Encourage your clients to consult their tax advisor or attorney.
Income tax free distributions are achieved by withdrawing to the cost basis (premiums paid), then using policy loans.  Loans and withdrawals may generate an income tax liability, reduce available cash value, and reduce death benefit, or cause the policy to lapse.  This assumes the policy qualifies as life insurance and is not a modified endowment contract.

Both loans and withdrawals from a permanent life insurance policy may be subject to penalties and fees and, along with any accrued loan interest, will reduce the policy's account value and death benefit. Assuming a policy is not a Modified Endowment Contract (MEC), withdrawals are taxed only to the ex that they exceed the policy owner's cost basis in the policy and usually loans are free from current federal taxation. A policy loan could result in tax consequences if the policy lapses or is surrendered while a loan is outstanding. Distributions from MECs are subject to federal income tax to the extent of the gain in the policy and taxable distributions are subject to a 10% additional tax prior to age 59½, with certain exceptions.

The tax and estate planning information contained herein is general in nature, is provided for informational purposes only, and should not be construed as legal or tax advice. Partners Advantage does not provide legal or tax advice. Partners Advantage cannot guarantee that such information is accurate, complete, or timely. Laws of a particular state or laws that may be applicable to a particular situation may have an impact on the applicability, accuracy, or completeness of such information. Federal and state laws and regulations are complex and are subject to change. Changes in such laws and regulations may have a material impact on pre- and/or after-tax investment results. Partners Advantage does not assume any obligation to inform you of any subsequent changes in the tax law or other factors that could affect the information contained herein. Partners Advantage makes no warranties with regard to such information or results obtained by its use. Partners Advantage disclaims any liability arising out of your use of, or any tax position taken in reliance on, such information. Always consult an attorney or tax professional regarding your specific legal or tax situation.

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Behavioral Finance and the Two Lane Highway

Even though the “Robo-Advisors” would disagree with me, today I would argue that in this day and age the most important thing a financial professional can do is relate to the “art” and not the “science” of their profession.  In other words, the most successful financial professionals I have ever worked with would agree that it is about the art of simplification, analogies, storytelling, managing clients’ emotions so they make healthy financial decisions, and to help them through good times and bad times.  I do believe the “science” of algorithms, Monte Carlo Analysis, alpha, beta, sharpe ratios, etc.; they are all important, but should they take a backseat to the “art” of BEHAVIORAL FINANCE?  Let me give an example of a simple behavioral analogy I like to use in financial professional and client seminars.  

A fitting analogy is that buying high and selling low in the stock market is a lot like driving down a two lane highway. Pretend you are sitting in the right lane and both lanes are at a standstill. What do you do when you notice the left lane is starting to move? You move into the left lane. Shortly after that, the left lane always comes to a standstill. Well, shortly after that is typically when you see the right lane starting to move forward. So then what do you do? You move back into the right lane. What happens to the right lane at that point in time? It comes to a standstill. But of course, that is when the left lane opens up and you hopelessly jump back into the left lane. Many of us do this over and over again to then realize that it is a losing proposition. Why does this phenomenon happen with traffic where it seems like you cannot win by switching from lane to lane? Because everybody else has the same idea of jumping into the same lane as you, the moving lane, and eventually the bubble bursts and traffic comes to a standstill. Due to the fact that everyone moved from the other lane and thus "emptied" it, the other lane opens up. At that point, everybody jumps back into that other lane and you create another "bubble“ that stalls traffic. 

That is very analogous to how the stock market behaves. Because people buy high and sell low by chasing each other, they actually do not perform as well as what the market actually does over the long haul. 

Some of the most profound studies in this area have been done by the financial services market research firm, DALBAR. Dalbar recently launched their 22nd study on investment returns versus the returns actually experienced by investors. They found that over the 20-year period of time ending December 31, 2015, the average return for equity mutual fund investors was only 4.67% even though the average in the S&P 500 was 8.19%. Thus, a 3.52% "gap" in investment returns versus investor returns. This "gap" on a $100,000 investment can mean significant damage to a pre-retirees’ or retirees’ retirement portfolio. For example, if that $100,000 gets 4.67% over a 20-year period of time versus 8.19% over a 20-year period of time that is the difference of having $249,140 versus $482,772 by the end. This is a difference of $233,632 by "buying high and selling low." And this does not include the negative impacts of taxes and trading costs for the investor that moves in and out of the market.

So again, whether it is providing simplification and analogies like the two lane highway or managing a clients emotions so they don’t “buy high” and “sell low,” today this is one of the most important topics a financial professional can use to “sharpen their axe” which is the study of Behavioral Finance.  

Learn more in the full white paper "What Robo-Advisors Cannot Do That You Can. An Introduction to Behavioral Finance," by Charlie Gipple, CLU, ChFC. 

Fill out my online form.

Questions or Need Case Assistance: Contact the Partners Advantage Brokerage Team at 888-251-5525, Ext. 700.

For financial professional use only. Not for use with consumers.

Please note that in order to provide a recommendation to a client about the transfer of funds from an investment product to a fixed insurance or annuity, you must hold the proper securities registration and be currently affiliated with a broker/dealer. If you are unsure whether or not the information you are providing to a client represents general guidance or a specific recommendation to liquidate a security, please contact the individual state securities department in the states in which you conduct business. The information in this presentation is for general use and while we believe the Information is reliable and accurate, it is important to remember individual situations may be entirely different. Therefore, information should be relied upon only when coordinated with professional tax and financial advice. You need to take into account your client's health and legacy goals. Neither the information presented or any opinion expressed constitutes a representation by us or a solicitation of the purchase or sale of any insurance or securities products and services.

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Postpone the R in your RMDs

This is an Advanced Markets Minute provided by and used with permission from Mutual of Omaha - Advanced Markets

As you know, starting at age 70½, owners of qualified retirement accounts must take required minimum distributions (RMDs). However, some investors may not want to take RMDs on their entire pre-tax account, as it is all taxed as ordinary income and may provide them with more income than they need. Unfortunately, as their name implies, RMDs are required. 

At the same time, today’s longer life expectancies may have some investors questioning whether they will have enough to cover their expenses in the later years of retirement.  According to IRS life expectancy tables, there’s a 50% chance of a 65-year-old man living to age 85 and the same chance of a 65-year-old woman living to age 88.  Retirees may find themselves needing income later in life to cover expenses which may increase as they age, such as prescription drugs, in-home care, and other health care related expenses. 

A client with these concerns may benefit from a Qualified Longevity Annuity Contract (QLAC).  A QLAC is a deferred income annuity that allows investors to postpone taking income from their traditional IRA or qualified employer-sponsored plan until up to age 85.  With a QLAC, the investor shifts the longevity, market and interest rate risk to the insurer, who promises to pay guaranteed income for the investor’s life. This creates a pension-like income, and allows the investor to postpone taking such taxable distributions until age 85.   

If your client is married, the QLAC can be structured to protect both the owner and the owner’s spouse from longevity, market and interest rate risk.  A joint and survivor annuity option can be selected at contract purchase, which will guarantee income payments for the owner and the owner’s spouse for as long as they live.  Simply structure the contract with the owner and owner’s spouse as joint annuitant’s and list the owner’s spouse as the beneficiary of the contract as well.  That way if the owner or owner’s spouse die prior to or after the income start date, the survivor can continue the contract and receive income payments for the remainder of his/her life.  If a return of premium death benefit is preferred, the owner can select a cash refund option. 

Like all good things, there are limits. The IRS has limited QLAC premium to $125,000 or 25% of the investor’s qualified account balance, whichever is less.  There are also restrictions on the flexibility of deferred income annuities that should be discussed with your client because the contracts are irrevocable, no withdrawals are permitted and will have no cash surrender value.  These are just a few items to note. There are other considerations with a QLAC that should be addressed prior to recommending to a client. Advanced Markets can be a resource to assist you with a QLAC. 

For the right client, a QLAC can let them postpone some required distributions and the taxes that accompany them. Call us in Advanced Markets if you have any questions. 

This information is general in nature and not comprehensive, the applicable laws change frequently and the strategies suggested may not be suitable for everyone. Clients should seek advice from tax and legal advisors regarding their individual situation prior to making financial decisions. Mutual of Omaha and its representatives do not provide tax advice. 

Contact Partners Advantage for complete Advanced Markets assistance at 

888-251-5525, Ext. 361

For financial professional use only. Not for use with consumers.

The advice provided in this communication is not intended or written by the practitioner to be used and may not be used by you for the purpose of avoiding penalties that may be imposed by the IRS or any other taxing authority.

The advice in this communication was written to support the promotion or marketing of the transaction(s) or matter(s) addressed by the written advice.

You should seek advice based on your particular circumstances from an independent tax advisor.