Michael Clementi

Your clients work with you today because they need your help piecing together their puzzling financial plan so their retirement lifestyle is comfortable and structured for a lifetime benefit. After building their net worth, your clients are happily coasting through retirement, but there is a new challenge on the horizon that you probably have not discussed with them yet. That missing puzzle piece is an asset-based long term care plan.

Before implementing a long term care plan to complete your client’s financial puzzle, there are a few considerations to make. The first thing to recognize is the steep costs associated with long term care expenses without implementing a proper plan. Second, you must identify the target market within your current book of business. Finally, you must determine which asset will be the most appropriate to fund your asset-based long term care plan.

The rising costs of a long term care facility could be the biggest financial burden your clients face. Without proper planning they could be paying a $100,000 annual bill for nursing home care alone. The average nursing home cost in the United States is $108,405. Depending on their location, that number can reach shocking heights. For instance, in my home state of California, the average nursing home cost is $146,000. If your clients faced an annual bill of this magnitude in retirement, wouldn’t that be a key factor to consider in their financial plan?

Insurance is already a requirement to mitigate future financial risk in many areas of our lives. I own a car and need car insurance to drive. I own a house and need homeowner’s insurance to live. The odds of me getting in a car accident are 1 in 240, the odds of a fire in my house are 1 in 1,200, yet the odds of me needing long term care insurance are one in two. The fact of the matter is that long term care insurance is not a want but a need. The costs for a nursing home are rising each year with inflation and, as their advisor, you are responsible for recommending a long term care plan that addresses this financial threat that half of your book of business is expected to face.

After recognizing this financial gap within a comprehensive retirement plan, it’s vital to identify who needs asset-based long term care within your book of business. In the past 50 years we have moved towards the most critical time to promote asset-based long term care. In 2024, 4 million baby boomers will retire, or 11,000 per day. This wave of retirees is called the “Silver Tsunami” due to the astounding size and opportunity within this target client base. Much like the series of waves that strike during a real tsunami, another surge from the Silver Tsunami is rippling through our industry. The 4 million baby boomers retiring this year alone hold an astounding $27 trillion of retirement assets, creating an immense opportunity for financial planners to work with this large, asset-heavy client base.

State governments are already acknowledging the implications of this overwhelming population in need of long term care. On July 1, 2023, the state of Washington put into effect the WA Cares Act to reduce the pressure on the Medicaid system and combat the rising medical costs. The WA Cares Act implements a 0.58 percent payroll tax on all W2 employees to pay into a state-run long term care program. When the announcement went public, requests for asset-based long term care plans in the state of Washington for W2 employees increased drastically to avoid the statewide mandated tax.

Furthermore, the following 12 states have established committees for implementing statewide long term care taxes in 2025: Oregon, California, Arkansas, Utah, Colorado, Minnesota, Missouri, Illinois, Michigan, Pennsylvania, New York, and North Carolina. People have not forgotten the horrible effects COVID-19 had on nursing home facilities. Interacting with loved ones through a plastic screen is far from the ideal situation for any client. People are opting for the higher costs of in-home care so they can spend the remaining years with their loved ones. As previously stated, between the Silver Tsunami and state-mandated long term care taxes on the horizon, today is truly the best day to promote asset-based long term care plans.

Your unique selling proposition as an advisor needs to address the main concerns vocalized by the baby boomer generation of guaranteeing income until life expectancy and protecting their hard-earned retirement assets. In a recent nationwide baby boomer survey, we found that boomers are three times more worried about running out of income, experiencing a major illness, or ending up in a nursing home compared to dying. This demonstrates the complex emotional distress when planning for the unexpected. Unfortunately, a majority of clients are less worried about their health than they are about becoming a financial burden to their loved ones in their old age. If we do not create a proper plan early enough in retirement, then your clients’ children could risk facing nursing home costs of over $100,000 per year.

Now that you know the importance of asset-based long term care planning and the target market, it is time to go over how you are going to get this important message to your clients. You likely have received calls from an insurance marketer pitching you on a fancy seminar program that costs you a ton of marketing dollars and bogs you down with more work than anticipated. I am here to let you know that you probably have hundreds of cases within your current book of business that are right in front of you and ready to go paid today. How many families do you currently manage assets for and, of those families, how many have a long term care plan in place right now? If the answer is less than 100 percent then we have some work to do.

When approaching clients about long term care strategies, the most important pieces are the delivery of the message and the ease of implementation. We do not need to show par rates, bonuses, or ledgers. We need to identify their current concerns, create their desired scenario, and illustrate the easiest path of implementation. If you are an independent advisor in the field trying to generate asset-based long term care sales, then you have access to a client-friendly long term care survey that will accomplish exactly what you just read. This process is incredibly simple.

First, generate an email list of clients from your current book of business who you have identified as someone who needs to hear this message. Second, you need to include a link to the five-question 2024 Long Term Care Survey in the body of the email and track the results. After the survey is completed, you will have access to the following results:

1. Which clients are concerned about future long term care costs.
2. Would they prefer a nursing home, assisted living, or in-home care.
3. Which asset they would use to pay for long term care costs.
4. Who wants to make an appointment with you.

Finally, the third step is collaborating with your team on identifying the best asset-based long term care plan based on your client’s survey results. Each client has a unique set of circumstances, so it is important to partner with a team that specializes in asset-based long term care strategies to ensure you can meet their individual needs.

In conclusion, rising medical costs are a concern that is top of mind for clients, and a growing number of state governments planning to implement mandated taxes to address it. If you are not currently talking about this with your clients, then I highly recommend you get the 2024 Long Term Care Survey implemented in your marketing. I highly encourage you to reach out to me and my team at Simplicity for support in harnessing this immense opportunity at your doorstep.

As I look at my life, I realize how many things I need to have insured just to live in the United States. If you currently own a house or rent from somebody, you need to have renter’s insurance or home insurance. If you drove your car to work today, then you need to have car insurance. Lastly, if you have young children and want to make sure they are taken care of financially if you pass away, then you probably have life insurance on you and your spouse. We rely on insurance carriers to provide a financial benefit if we ever need to make a claim. If we need insurance on all these parts of our lives, then why are we not putting insurance on our retirement income streams?

The foundation of our parents and grandparents’ retirement model was built on the income provided by social security and pension plans. The income stream was protected and guaranteed, while the risk was put on the employer and government to deliver on their promise. All our parents had savings accounts which portrayed the message of growing your assets and focusing on getting a good rate of return on your money. With this advice, they would potentially go out and risk all their money in the stock market. If the market crashed and they lost a significant amount of money it would not be a concern to them because most of their retirement income was coming from protected sources. These clients could afford that loss and move on.

Unfortunately, this retirement model for our generation is currently broken and completely flipped upside down. Pensions seem to be all but gone (or extremely difficult to come by) and the retirement benefits from social security have dwindled down dramatically from what previous generations received. So where is the rest of your income going to come from? The answer is you. Most of the risk now is on you–the consumer–to make sure you have enough money to last throughout retirement. Yet, this directly contradicts the message we’re all being conditioned to believe: Continue to focus on growing your assets as much as possible and get the highest rate of return on your money.​

I am here to tell you that the only way to have a successful retirement plan is to have an income plan that is guaranteed to life expectancy and will not lose any money to dips and fluctuations in the stock market. The strategy used to accomplish this goal is straightforward and used to protect and grow assets. It involves moving a portion of your money into a fixed indexed annuity (FIA) with a guaranteed lifetime income rider. An income rider is the contractual guarantee from an insurance company to pay you no matter how long you live. This strategy puts insurance on your retirement income and leverages your risk to an A-rated insurance company. It’s the same with medical insurance. Your provider is there to help take the financial burden away from you in the case of a health or medical emergency. You wouldn’t leave your health to chance, so why wouldn’t you want to have insurance on your retirement income?

The definition of an annuity is a fixed sum of money paid to someone each year, typically for the rest of their life. You may not know it, but if you are paying into social security, then you are currently participating in the biggest annuity plan in the United States. The definition and strategy changes depending on who is paying you. Social Security comes as payments directly from the government. A pension is guaranteed lifetime payments from an employer. An annuity is guaranteed lifetime payments from an insurance company.

There are so many risks that we must protect ourselves from in retirement. FIAs typically focus on addressing three main risks: Stock market volatility, longevity, and inflation. How many times did you turn on the news this last year and hear the word “volatility?” Every time that message is broadcast it typically means that your retirement account just lost money, which is going to directly affect when you retire and how much money you will receive. When you move your money into an annuity, you are taking your money out of the “investment” category and into the “indexed” category. This means that your original principal is completely protected from the negative returns you see in the stock market. So, the next time you turn on the news and see those treacherous headlines, you will have peace of mind knowing that your money is protected.

Longevity means that you are going to have a long life. It is hard to think of this as a risk because it means that you are healthy and plan to live to age 90 or above. I call longevity the risk multiplier. The longer you live, the more likely you are to see high inflation rates and more volatile markets. If you plan to have a long and healthy life, then you need an income stream that can last your lifetime. The FIA with an income rider is a contractual guarantee by an insurance carrier that those payments will last your lifetime. You can live up to 110 years old and still get payments sent to your mailbox. If you are currently married there is a 50 percent chance that one of you will live to at least 90 years of age, so it is extremely important to guarantee an income stream for the surviving spouse.

A retirement risk that I cannot ignore, especially in today’s climate, is inflation. Inflation is defined as the general increase in price and decrease in purchase value of money. This means that if your income in retirement does not increase each year, then you will not be able to afford the same goods and services that you did the day you retired. Depending on the acceleration of the price increase, this could really burn a hole through your wallet! I call this the stealth tax. There are many annuity products that have increasing income options on their income rider products. These are typically tied to market performance and as long as you do not get a zero percent return, then your income will increase.

Whenever you are planning your retirement, you always want to keep in mind your “why.” Most people’s “why” is protecting their spouse and kids to make sure they are taken care of financially in any situation. I would argue that you should be your why. Think about it. If you run out of money in retirement, who is going to take care of you? Typically we see the spouse or kids needing to pitch in their money and assets to take care of their family members who did not create or follow through with a plan that would take care of them until they actually pass. By putting a portion of your money into a fixed indexed annuity with a guaranteed lifetime income rider, you are creating an income plan that will alleviate stress in the lives of you and your family. People who have money in FIAs do not lose sleep at night over negative downturns in the market because they know that they have a check from the insurance carrier coming to their mailbox each month no matter what happens to their investments. 

GA, BGA, IMO…the list of acronyms can vary depending on who you’re talking to. Opinions on which brokerage general agency or independent marketing organization to work with can vary even more. The decision can be almost as important as deciding who you’re going to marry! In my four years as a field support representative for an IMO, I’ve had a front row seat to witnessing what truly makes a difference in a successful relationship between and independent advisor and the IMO/BGA they’re working with, how the right relationship can increase an advisor’s production, and how a symbiotic relationship between the two can provide the best solutions for clients. Understanding this has been the reason behind the passion I have to help my advisors in every aspect of their business.

Before we get into the benefits of working with the right IMO/BGA, I’d like to take you back to 1967 in Fort Worth, Texas, when an independent advisor named Bill Zimmerman started his journey into the industry and to what would become the proving ground for the IMO he would build years later.

Like many of you reading this, Bill started off with a fresh new life insurance license and looking to go out into the world and start selling. But where to start? It was recommended to Bill that he sell to his friends and family and then work his network from there. Each person he talked to would then provide a referral which would continue to fill his pipeline. As the months went on Bill realized that he had sold all of his friends and their families policies and the referrals seemed to have dried up. That’s when he realized he needed to create another opportunity for prospects. It was time to hit the streets and start talking to people he had never met before and to make himself an insurance authority in his community. But before he started knocking on doors, Bill knew that he needed something in his arsenal that would make him stand out from any insurance agent around and make sure the people he spoke to would never forget him.

This is when the “cassette tape marketing plan” was born.

Bill stormed into his office (that was in his garage) and started writing a script on how life insurance can “make your life better.” After weeks of fine tuning the script, Bill went out and purchased a tape recorder and hundreds of blank cassette tapes. He took the microphone and recorded his own voice on those cassette tapes and created an audio presentation that would win over his future clients. The tapes were around 10 minutes long and opened a door of vulnerability that created a sense of trust and rapport to everyone who listened. Bill knew that his message of helping families and making lives better would lead to more people to talk to and earn him a great reputation in the insurance industry.

Bill hit the streets every day of the week and started knocking on every door and small business in his neighborhood. If you answered the door you were greeted with a smile, a handshake, and great conversation. If you were not home, you were left an envelope with Bill’s contact information and one of his famous cassette tapes. After weeks of talking to everyone in his local area, Bill had a full calendar of meetings and appointments.

Then the real work started…

Having an endless supply of clients is the dream of any insurance agent. What the dream does not present is all the work and time management that comes with the clients. Each meeting came with a unique problem that Bill had to solve. The biggest issue was that he was doing this all by himself! If there was ever a new carrier with a better product, Bill would have to get himself contracted and follow up to make sure his contract was active before submitting business. Each family needed quotes run for every member which led to hours of his day spent running quotes. Whenever there was a need to make more cassette tapes, Bill would have to take time out of his day to duplicate, package, and drop them off to each house and business. The epiphany moment was when Bill realized he was working more in his business than on his business–that’s when he realized there was an opportunity to create his own IMO/BGA that could work with other top advisors to relieve them of these “no pay zone” activities so they could focus on meeting new clients and submitting business.

This was the beginning of our IMO/BGA, now known as LifePro Financial. Four years ago, I had the great privilege to walk into LifePro’s doors and begin my career helping advisors with those “no pay zone” activities, and work hand in hand with them to build their business. The culture that Bill taught me, and our team, carries on throughout our company, allowing us to deliver top quality service and create lifelong relationships with all our advisors. Having known Bill Zimmerman and seen firsthand the fruits of his efforts, I understand from a microscopic view how a symbiotic and client-centric partnership can help.

Technology and Service
A true test of how a BGA adapts to new technology and services was when COVID-19 hit our country, and everyone had to work from home. Every advisor in our industry was wondering “How am I going to be able to sell from my house?” The IMO/BGAs we saw that stood out were those that were able to funnel prospects directly from social media platforms to the computer screens of their advisors. The most popular platform was turning the in-person dinner seminars to online educational webinars. This was a way for advisors to create a predictable pipeline of clients to generate business. The next iteration of technology was content creation and trackable marketing campaigns.

The best advisors I see are ones that are constantly sending out communication to clients and prospects. IMO/BGA’s that stand out are the ones that generate the content and track the results for their advisors. Anybody can send an email on behalf of your team, but what happens after the email is sent? The advisor would now need to cold call their list and remind them to read an email that might have defaulted to their junk folder. An IMO/BGA that has email campaigns with trackable results can make all the difference in the world in this part of the process. The email should contain captivating content that grabs the attention of your prospect and includes branded landing pages with downloadable marketing pieces. After the email is sent you, as the advisor, should be able to see who opened the email, clicked the funnel to the branded landing page, and who downloaded the deliverable marketing pieces. It’s with this help that you can now optimize your time on the follow up for higher appointment rates.

Other considerations to look for in an IMO/BGA partnership is where your marketing dollars are being spent and feeling that they deliver on their promises. I have heard the false promises of high appointment rates and high average cases for a nominal fee with guarantees of a certain number of people in your appointment book. However, once you start meeting with these appointments, you realize all the prospects do not fit the mold of your client base and/or you cannot help them. Now the IMO/BGA has pocketed your money and told you to pay for another campaign with more promises that it will be made better if you do so. This is a nightmare story that happens time and time again. You want your BGA to not see your dollars as their profit center. Make sure that you know exactly how your money is being put to work. The ethical IMO/BGAs do not split commissions with advisors but get paid directly from insurance carriers when they help you place cases. An advisor’s success and an IMO/BGA’s success should go hand in hand.

Partnering with Niche Product Experts
As an advisor you want to partner up with an IMO/BGA that specializes in specific product markets. I see IMO/BGAs offer every type of insurance under the sun and become a “jack of all trades, master of none.” You want to work with a company that allocates their marketing material and product experts to a finite amount of insurance products. For example, think of an IMO/BGA that specializes in only fixed indexed universal life, fixed indexed annuities, and assets under management. All the reports and marketing material that are generated relate to these products and assist advisors in helping close the sale. Think of this as more of a boutique vs a big box store approach.

You want to have a BGA that has employees and product experts that can help you sell the products that they offer. Instead of just a carrier specific illustration, you should have a branded report that is more of a presentation that can compare the specific product to different taxable buckets and brokerage scenarios. This helps educate the client and provides an easy-to-follow approach in even the most technical of sales. Now the client can see you as their guide and coach and understands that you have scoured the market for solutions tailored to them.

Agency Growth and a Service to the Industry
The main goal of an IMO/BGA should be helping to grow an advisor’s business. Advisors should be able to scale up their practice after working with their IMO/BGA. I have seen the stages of advisor growth broken down into three main parts. First, every advisor begins in the “startup” phase. This is where you are selling the majority to your friends and family and trying to build your brand and your unique sales process. This would be the “cassette tape” lead system for Bill Zimmerman. Bill found his way to stand out from the competition and was able to scale his practice from an independent advisor to a business making advisors successful. At some point in this process, you are going to hit the “capacity wall.” That is when you’ve realized most of your daily tasks are focused on non-revenue generating activities. This could be broken down into areas such as learning new software to run quotes, calling into insurance carriers to check on case statuses, filling out contracting paperwork to get appointed with a new carrier, being a product expert to find the best solutions for your clients, etc. All these tasks help your business, but do not help grow your business.

At this point, the decision needs to be made to create an infrastructure that can alleviate you from performing non-revenue generating activities in order to spend your time focusing on meeting with clients and submitting applications. Many advisors will hire a team to handle those tasks, but I am here to tell you that by finding the right IMO/BGA to partner with and rely on to do those tasks for you, you can then still scale your business. An IMO/BGA should integrate their services into your already successful business. Now that you can focus solely on revenue generating tasks and developing a successful business, you are going to run into a “size wall.” This is where you are taking on so much business that you as a solo advisor cannot handle it all on your own. You have now turned your business into an enterprise/brand. At this stage you have developed a proven repeatable process and have built a solid reputation in your community. This is the goal for all our advisors. We want to take each advisor through the three stages of growth from individual to business, to enterprise.

Lastly, you want to partner with a BGA that provides a service to the industry. Make sure they have core values that they live by that also line up with your beliefs. A good indicator is knowing how many families the IMO/BGA has helped and how many advisors they are currently working with. It is always great to ask for testimonials from advisors who work with that IMO/BGA and ask how the IMO/BGA has helped them to scale their practice? Do they follow through on their promises? Do they have their best interests in mind?

As you look at your business today and where you would like to be in the future, is your current IMO/BGA fulfilling promises they’ve made to you? Have they helped you increase your business and provide better solutions for you and your clients? Do you feel like they are a true partner in your business? With those questions in mind, along with the insight from inside an IMO/BGA, I hope you too can take your business to the next level.