Sales Script — 3 Stages of Money

Proven producers, proven ideas, proven sales scripts. Quit being the lab rat for suspect ideas that will never work!

Today I’m sharing immediate ideas (and potential access) to a remarkable call from a friend of mine and fellow top-advisor of yours, Mike Reese. As you may know, Mike is one of the top IRA experts in the country and runs a phenomenally successful planning practice. His book-smart CFP concepts combine with  street-smart marketing savvy; making a lethal combination. He’s always improving…

Today I want to share Mike’s latest addition to the appointment process, detailing his NEW “3 Stages of Money” conversation.  To summarize:

  • Stage #1: SAVINGS – This is when you’re Young, needing Safety & Liquidity (think BANKS).
  • Stage #2: INVESTMENTS – We’re into Adulthood, introduced to investments. Risk and Return are paramount. This stage is about Accumulation (think BROKERAGE/WALL STREET).
  • Stage #3: INCOME – This is when we’re Retired, needing Contractual Guarantees (think INSURANCE COMPANIES).

Stage #2 (BROKERAGE/WALL STREET) ran wild during the 1980s and 1990s; running investment balances sky-high! Not only did retirement balances run sky-high, but so did expectations! Creating today’s perfect storm. Many retirees and soon-to-be retirees are trapped with lofty, false expectations about what’s realistic with their investments. They’re fighting themselves to leave money in stage 2 too long!!! But now the people who prospered most don’t need growth; they need income. And what’s wrong with staying in Stage 2 for Income Planning?

  • If equity markets perform well — nothing!!!
  • If equity markets remain volatile and perform poorly — everything!!!

Many reputable asset allocation managers still apply the 4% Distribution Rule to client portfolios. If you withdraw only 4% of your assets each year, they say you won’t go broke 90% of the time. First of all, who wants to only withdraw 4% of their savings during retirement? Clients worked very, very hard for decades to retire – let them enjoy it!  Contractually
guaranteed, Stage 3, insurance strategies can allow you to withdraw upwards of 6%? Take advantage!

Second of all, if the 4% Distribution Rule works 90% of the time (and I’d argue that premise) is that good enough? Would you board an airplane if it landed safely 90% of the time? Would you eat something for dinner if it didn’t poison you 90% of the time? But it seems like 90% is supposed to be okay for your life savings and retirement. It might be okay for Wall Street retirements. But it’s not good enough for plane flights, dinner and it’s not good enough for your clients. Quit thinking the 1990s are going to happen again! Clients need to transition quickly to stage #3 thinking and protect their hard-earned money with contractual guarantees of income.

Comment below if you’d like instant (recorded) webinar access to Mike Reese’s full explanation! It’s powerful and will undoubtedly help you close more sales.
Make it a great week.

3 Retirement Income Options

When your clients retire and need income, they essentially have three options to choose from. These options are explained very well in the book The Great Wall Street Retirement Scam by Rick Bueter. In his best-seller, Mr. Bueter goes into detail about the pros and cons of each option. We covered this at a training event last week and I received numerous requests for the presentation.  So without further ado, here’s a summary for you to use right away!

3 Retirement Income Options:

1. “The Bank’s Way” to Retirement

Lose your money safely – According to (as of May 2, 2011), the average 1 year CD is currently paying 1.16%. According to (as of May 2, 2011) the current inflation is 2.68%. This is what we call a “moonwalk account” – one of Michael Jackson’s claims to fame in which he looked like he was walking forward but was actually moving backward!
Deal with the emotional stress of volatilityCLICK HERE for a chart showing the volatility of CD interest rates over the past 50 years.
Guaranteed income – While there is no guarantee of income for the rest of a retiree’s life using bank vehicles, if using a conservative withdrawal rate based on historical returns, clients with $1,000,000 could hopefully take between $10,000-$30,000 annually and be safely positioned for at least 25 years.

2. “The Wall Street Way” to Retirement
Emotional stress of volatilityCLICK HERE for a chart showing the volatility of the Dow Jones. You’ll notice that the market typically moves in cycles, with the shortest “down cycle” lasting 17 years. Note that we are only 11 years into our current downturn.
Assume the responsibility of a pension manager – What if we have another 2008 and clients lose 30%, 40% or even 50% of their retirement savings? The popular Wall Street myth about earning a 10% average return if you buy and hold goes out the window if retirees are taking withdrawals and depending on their money for income.
(EMAIL ME for a free report by Mike Reese entitled “10% Market Lie.”)
• AARP recommends retirees’ withdrawal rates generally not exceed 4%. (CLICK HERE for the entire article.)
Guaranteed Income– There is no guarantee of income for life using “The Wall Street Way” to retirement, but according to AARP ( as of May 2, 2011 ), $1,000,000 may get clients roughly $40,000 for a period of 25 years.

3. “The Insurance Way” to Retirement
Utilize guaranteed income options – Annuities are the only vehicle which can guarantee income for the rest of a person’s life.
Eliminate the emotional stress of volatility – Retirees can lock in a payment they can depend on – no matter what happens to interest rates, the economy, etc.
Transfer the responsibility of pension management – Insurance companies have been managing pension style incomes for over a century.
Guarantee retirement income – Using an example of $1,000,000 and a guaranteed income distribution of 6%-8% annually, clients could be guaranteed an income of $60,000 to $80,000 – potentially 50% more income than the “Bank” or “Wall Street Way.”

In summary, when it comes to income for retirement, it’s pretty clear that leveraging insured retirement income solutions can rid retirees of the stress of the market by not only guaranteeing income for life but getting MORE income while they’re at it!

For a real life example, last week we prepared the casework for a client who was 62 years old and he wanted income at age 65 for the rest of his life. He had 500k in an IRA to fund it with. 
This client was able to get a guaranteed income of $38,318 for the rest of his life. NOT BY ANNUITIZATION OR GIVING UP ANY CONTROL OF HIS MONEY!

Have a great week!