117. Best ways to deal with rejection based on my personal experience

 

One of the most challenging aspects of being a financial advisor is how to deal with constant rejections. 

In my own practice (around 30+ years' worth), I also have also gone through a lot of these, and the final outcome usually is affected by how I dealt with it.

First is that I learned that if I take it personally, it usually ends whatever chances I have left in salvaging the business relationship, selling is a big part of financial advisory and rejection is a natural part of the sales process, a rejection is not a reflection of our worth as advisors.

Second is that I treat each rejection as a learning experience in my growth as a salesperson, I reflect on the event and try to identify what have I done right? what have I done wrong? how i can make a better presentation next time I encounter the same situation.

Third is not giving up. We can give up on that particular prospect but don't give up on the career! one rejection does not mean we will get rejected all the time! move on to the next prospect!

Fourth is to adapt and refine my approach. Whether I am selling or making a presentation, I take note of the reactions to what I have just said, if it has some positive impact on the prospect or my audience, I remember it. If it is taken negatively, I would reflect on it and restate it in some other way.

Lastly is that it helps to have a support system, the most productive part of my career has always been when I am in a group of like-minded individuals going through the same experiences, during meetings, we would talk about it, laugh about it and discuss ways and means and how it could have been done better.

This is just a short post, but I hope you have pick up some nuggets that could help you deal with rejections better!

All the best my friends!

jeff

116. Why do I keep writing blog posts that nobody reads anyway?

Some people think I am successful, some people think I am a total failure, but no matter what others think I don't mind, because I have happy and grateful to where I am today.

My journey is not an easy one, maybe I have to overcome much more obstacles to get to where I am today, I have highs and I have lows, along the way I made mistakes, learned from it and moved on. 

I write blog posts for the audience of one, if I just inspire one reader, then I am fulfilled. here is one of my life stories...

I started working when I was 14, I was in my third year in high school and summers are spent in helping out customers with their orders in hardware stores in our area, this was not a big deal as quite a number of my classmates are also doing the same thing, the only difference is that they are working for their own family business while I am working for others.

These brief summer jobs gave me my first learning opportunities in realizing that a "customer" - someone willing to pay money for a product or service is the lifeblood of any business.

High school ended and college began, because of the need to self-support my studies, I opted for night classes so daytime can be used to find employment. 

A high school graduate in the job market really does not have a lot of options. Safe/regular clerical jobs are often for people with higher educational attainments, so I ended up as a salesman.

My first job is selling "Collier's Encyclopedias", yes! this is the pre digital age and encyclopedias are still the main resource materials. With the confidence I learn in my hardware store stints dealing with customers, I enthusiastically went out and look for my first customer!

Obviously, the skill set needed to sell a high-priced set of encyclopedias is much higher than the skill set to sell hammers and nails, I was not able to sell any.

The second realization I have is that to convince a customer to pay for a product or service, the salesman must be very knowledgeable with his product and be able to find ways to demonstrate to the customer how this product can help them. We are told by our trainers to approach parents and convince them that by buying a set, they are giving their children a heads up in learning and may help them better themselves academically.

The third realization I have is to be able a convinced a customer, we must know the customer, understand how a customer thinks and what he values. Then be able to position our product based on these.

Let me be the shoulder you stand on, as you scale greater heights!

Thank you, my friends. or is it Thank you my friend.

#acgadvice

115. Tips on how to re-start a stalled (insurance) career

There comes a time in the life of quite a number of insurance professionals that their career seems to hit a plateau, having given their all and achieving a certain level of success, the need on how to continue growing and generating income for sustenance places a lot of us in a situation of loss and hopelessness.

I have been in this same situation quite a number of times not just in my insurance career but also in the other jobs I had in my long years in the financial services industry.

I have chosen this industry as a way to make a living, while selling products is the most straightforward way to create income, there are actually other ways to create value and be paid for it.

Do an "honest" self-assessment - at this stage of my career what are my strengths and weakness? in terms of the market I am trying to penetrate, are my skill sets updated and relevant? Are there any areas I need to enhance? 

One example would be during the recent Covid lockdowns, selling life insurance for me is difficult as the HNI market I am focusing on is not so keen of taking on a new insurance policy "online", as their needs are more complex than the usual saving for education or retirement track- there is a need to "meet them in person" for a careful and deliberate discussion to surface these issues and create a financial plan to address them, mobility restrictions obviously prevented these from happening.

As I cannot sell at this time, I shifted my focus to what I can do.

The ability to sell a financial product is the end result of a series of various activities that includes but are not limited to prospecting, qualifying, presenting and finally the close. 

How we brand ourselves as competent and reliable financial advisors can help a lot in the prospecting stage of the process, we can help build our brand by sharing our ideas and insights through public (online) forums!

This is what I did! instead of sulking and being weigh down by inactivity, I offered numerous speaking gigs to agency groups and companies to keep myself busy, I talked about the various challenges we are all facing and suggesting course of actions on how all of us can overcome. Some found it of value and I got paid for it, some I did for the purpose of building up my personal brand to stay relevant.

I can't honestly say that these created positive impacts to everybody who attended my talks. but it sure helped rebuild my self-confidence and place me on track for opportunities that came later.

So, if you are now feeling lost and unsure on how to move forward, the best way out is to remain "active" and identify ways and means on how to stay relevant.

Some things that you can do to stay on track:

Continuous Learning: Stay curious and open-minded, and actively seek out opportunities to acquire new knowledge and skills. This could involve taking courses, attending workshops, reading books, and staying up to date with industry trends.

Stay Informed: Regularly consume news and information related to your field of interest or industry. Follow reputable sources, subscribe to newsletters, and engage in discussions to stay aware of the latest developments.

Networking: Build and maintain a strong professional network. Connect with colleagues, mentors, and peers in your industry. Networking can provide insights, opportunities, and collaborations that help you stay relevant.

but the most important is to be adaptable and be open to embrace changes, be willing to pivot your skills and strategies when needed. The ability to adjust to new circumstances is a key trait for staying relevant.

I am now consulting for a couple of life insurance companies to help them create products and expand distribution channels, work opportunities that most likely will not happen if I just let circumstances affect me negatively.

All the best my friends!

#acgadvice

114. I asked ChatGPT, Will AI replace the insurance advisor?

 

In the dynamic world of insurance sales, the ability to create a successful insurance career goes far beyond mere policy offerings. It hinges on delving into the psychology of your clients, comprehending their unique needs, and addressing their concerns on a personal level. This process involves an artful blend of empathetic understanding, trust-building, and a deep grasp of the psychological triggers that influence decision-making. 

What AI can't and the insurance advisor can! A human-to-human interaction!

Empathy and Listening Skills: The Foundation of Effective Communication

To truly resonate with your customers, start by mastering the art of active listening. Empathize with their situations, pay attention to their spoken and unspoken cues, and genuinely connect with their emotions. This not only aids in comprehending their requirements but also showcases your authentic concern for their well-being.

Building Trust and Credibility: The Bedrock of Successful Relationships

In the world of insurance, trust reigns supreme. Transparency and honesty should be your guiding principles. Share information freely, even if it doesn't directly lead to a sale. By showcasing your expertise and integrity, you lay the groundwork for building credibility and fostering trust over time.

Addressing Emotional Needs: Transforming Fear into Security

Insurance decisions are often underpinned by emotions such as fear, the need for financial security, and a desire to protect loved ones. Tailor your conversations to address these emotional triggers. Paint a vivid picture of how your insurance solutions can offer peace of mind, shielding their most cherished assets from uncertainties.

Storytelling and Relatability: Forging Bonds Through Narratives

Stories have a remarkable power to connect people. Share real-life instances where insurance has made a significant impact. Craft narratives that mirror your customers' situations, allowing them to envision the benefits of insurance within the context of their own lives.

Urgency and Scarcity: Encouraging Timely Action

Harness psychological triggers like urgency and scarcity to prompt action. Illustrate the repercussions of delaying insurance coverage or highlight limited-time policy availability. These prompts encourage customers to take action promptly.

Positive Framing and Language: Shaping Perceptions

Craft your language to focus on positivity. Instead of dwelling on worst-case scenarios, emphasize the benefits and security that insurance provides. Position insurance conversations around opportunities for a brighter future.

Visual Aids and Simplicity: Simplifying Complexities

Insurance can be intricate, but simplification is key. Utilize visual aids, diagrams, and straightforward explanations to enhance comprehension. Visual representation aids clarity and bolsters customer confidence.

Follow-Up and Relationship Building: Beyond the Initial Interaction

The psychology of sales stretches beyond the initial pitch. Stay in touch with your customers, offering ongoing value post-sale. This approach cements your role as a dependable resource for their evolving insurance needs.

Incorporating the psychology of insurance sales isn't just about selling policies – it's about fostering lasting connections. By tapping into your customers' emotions, needs, and perspectives, you're not only enhancing your sales prowess but also positioning yourself as a trusted advisor on their financial journey. Remember, understanding the psychology behind the decisions is the key to forging meaningful, lasting relationships in the world of insurance.

All the best my friends!

#acgadvice

113. Will focusing on HNIs help or hinder you from qualifying to the MDRT?

 

The High-Net-Worth Market - the Holy Grail of insurance agents?

HNIs are wealthy prospects, they have substantial resources coming from their own business or the practice of a profession, some inherits it, and some married into it.

This is the profile of THE "ideal prospect" for most insurance agents.

The reason is obvious... working with HNIs gives us the opportunity to conceptualized, create and recommend creative financial solutions to serve their unique needs, whether to set up a perpetual paying fund for grandchildren, ensuring his business pass on to a preferred offspring, creating a legacy fund to finance the building of a school in their name or simply creating an efficient financial vehicle to ensure the maximum preservation of their wealth.

and if we are successful, the rewards are also substantial! 

I am quite fortunate to know personally some people who belongs to this category, in the early phase of my insurance career, I have worked with some of them and qualified to the Million Dollar Round Table!

SUCCESS BREEDS HUBRIS! Because of my early success, my insurance career workflow became centered on this segment, all I need is two or three large policies per year, and I am home free to the MDRT?

Big Mistake!!

The HNI market is fiercely competitive! it is not unusual for them to be pursued by a lot of agents at any given time, offering them a myriad of products from real estate, fast cars, investment and insurance products just to name a few, most of them would have numerous policies already, the challenge now is how to sell a new policy on top of whatever they already have.

Some other challenges we faced are:

HNIs often have high expectations regarding the level of service and the quality of products they receive. They expect personalized and tailored solutions that cater to their unique financial situations and goals. Meeting and exceeding these expectations can be demanding.

They are very busy!! trying to get them to sit down and meet with us is a constant challenge.

HNIs tend to be well-informed and may conduct extensive research before making financial decisions, we need to be well-versed in our products and services, capable of providing in-depth information and answering detailed questions.

Because of these challenges, the conversion number from prospects to client is very low!!

My "big mistake" is not approaching and talking to a bigger number of prospects! I may have qualified to the MDRT, but I failed to qualify to the Macaulay, why? because I lack the necessary number of unique policies.

What did I learn?

A successful insurance career is not just about getting the production requirements in terms of premiums, it is also equally important in getting the minimum number of policy holders to remain sustainable. 

In conclusion: Focusing on HNIs and thus talking to a fewer number of prospects will hinder us from qualifying to the MDRT, Focusing on HNIs AND building a wider network of prospects will help us qualify!

All the best my friends!!

#acgadvice

112. To gain the trust of a prospect, focus on these 3 fundamentals to build a strong relationship

Ever since I got into a financial advisory practice, I have been very diligent in attending seminars and trainings to learn on how best to serve a client, I even augment these with numerous book readings on investments, financial planning and even boring stuff like economics. I even went further in securing financial designations which I hope would give me a certain veneer of credibility.

Sad to say, all these learnings did not translate to the level of business that a "learned advisor" of my caliber can expect, what am I doing wrong?

Much like any professionals like doctors or lawyers offering advice, the mistake lies in not first understanding a potential client's unique circumstances before offering any recommendation!

Here are the three fundamental areas that we need to focus on to build a strong foundation.

Financial Goals and Objectives: The first step is to understand your client's financial goals and objectives. Each client will have unique aspirations, such as retirement planning, purchasing a home, funding education, starting a business, or achieving specific investment targets. By comprehensively understanding their goals, you can tailor a plan that aligns with their aspirations and risk tolerance.

To get started, ask your clients about their short-term and long-term financial goals, their time horizon, and any specific milestones they want to achieve. Also, assess their current financial situation, including income, expenses, debts, assets, and existing investments. This information will serve as a foundation for creating a personalized financial roadmap.

Risk Assessment and Management: Assessing and managing risk is a vital aspect of any financial plan. Risk tolerance varies from person to person, and understanding how much risk a client is willing and able to take is crucial for designing an appropriate investment strategy.

Conduct a risk assessment questionnaire with your clients to gauge their comfort level with market fluctuations and potential losses. Based on their responses, recommend a diversified investment portfolio that balances risk and return in line with their objectives.

Additionally, consider other risk management tools such as insurance. Ensure that your clients have adequate coverage for life, health, disability, and other relevant insurances to protect them and their loved ones from unforeseen events that could derail their financial plan.

Budgeting and Cash Flow Management: A solid financial plan requires effective budgeting and cash flow management. Many clients may not be fully aware of their spending patterns and may struggle to save or invest as a result.

Work with your clients to create a detailed budget that tracks their income and expenses. Emphasize the importance of living within their means and saving regularly. Identifying areas where they can reduce discretionary spending or unnecessary expenses can free up more money for saving and investing.

Moreover, encourage clients to build an emergency fund to cover three to six months' worth of living expenses. This safety net ensures they won't have to dip into long-term investments in case of unexpected financial setbacks.

By focusing on these three fundamental areas—financial goals, risk management, and budgeting—you'll lay a strong foundation for your clients' financial success and build a relationship of trust and confidence. Remember to regularly review and update the financial plan as your clients' circumstances and goals evolve over time.

All the best my friends!

#acgadvice

111. The Biggest Risk of Long-term Investing is not the market

 

How do we manage risks of a long-term investment portfolio? Most would suggests employing investment management strategies such as diversification and asset allocation, 

The question of whether a goose that lays golden eggs or the golden eggs themselves are more important is subjective and depends on the context and individual perspective. Let's explore both viewpoints:

The Goose that Lays Golden Eggs: Some may argue that the goose is more important because it represents a sustainable source of wealth. The goose has the ability to continue laying golden eggs, providing a consistent and ongoing stream of value. By prioritizing the well-being and care of the goose, one ensures the longevity of the golden egg production. In this perspective, the focus is on long-term sustainability and the potential for continued prosperity. This is the analogy for the HEALTH and WELL BEING of the investor.

The Golden Eggs: Others may argue that the golden eggs themselves are more important because they represent immediate wealth and tangible benefits. The golden eggs are valuable and can be used or traded for various purposes, whether it be investment, consumption, or achieving financial goals. This viewpoint prioritizes the immediate gains and focuses on maximizing the value extracted from the eggs. This is the analogy for the INVESTMENT PORTFOLIO.

Ultimately, the answer may depend on one's goals, time horizon, and personal values. Balancing the short-term benefits of the golden eggs with the long-term sustainability of the goose is often considered an ideal approach. By recognizing the value of both the goose and the golden eggs, one can aim for ongoing wealth creation while enjoying the immediate rewards.

In a broader sense, the question can also serve as a metaphor. It raises considerations about the importance of nurturing and maintaining sustainable sources of wealth versus focusing solely on immediate gains. It encourages a strategic and balanced approach to wealth management and the recognition of the underlying factors that contribute to long-term prosperity.

The biggest risk of investing whatever the goal, time horizon or personal values is the HEALTH of the investor, because from a financial perspective, the biggest possible threat to the value of an investment portfolio is the sudden, large withdrawals to pay for the treatment of a critical illness!

Mitigate this risk by attaching a critical illness coverage!

All the best my friends!

#acgadvice

111. Financial Educators! Power Up your Campaign with these 5 Power Pointers!

 

Financial Educators aims to equip families especially the breadwinners with enough financial knowledge to enable them to establish a strong financial foundation, to reach out to more and transform lives, 

Here are 5 Power Pointers!

1. Keep yourself updated! - the global financial markets are continuously evolving, while basic fundamentals remain the same, financial planning must adapt to these changes to ensure families are able to withstand temporary setbacks, it's crucial for educators to continually educate themselves, stay updated on market trends, and seek guidance from mentors when needed to provide the best guidance to families.

2. Focus on "One Family at a time" - When educating a large crowd, it helps to remember that "One size does not fit all.." After the presentation the financial educator should take time to talk to invitees to understand the specific needs and objectives of each individual families. These insights would help in tailoring advice and solutions essential for providing effective financial guidance.

3. Save! Invest! Protect! - Financial security is not just about building wealth, equally important is also to set up provisions for the mitigation of life's major risk like critical healthcare and funding for old age, Guidance is best if your presentation is balanced between wealth creation and wealth protection.

4. Accept the fact that the market is "UNPREDICTABLE" over the short term: No financial educator can accurately predict or guarantee investment returns. Making unrealistic promises or guarantees can be misleading and may lead to disappointment and financial losses for families. It's crucial for educators to set realistic expectations and provide honest assessments of potential outcomes.

5. Follow on guidance by doing Regular Portfolio Reviews: Failing to regularly review and adjust investment portfolios can be a mistake. Market conditions change over time, and family circumstances evolve. Regular portfolio reviews are needed to ensure that investment strategies remain aligned with a family's goal and risk tolerance.

Onwards to 30M by 2030!

All the best my friends!

#acgadvice

110. Why financial Literacy is key to Financial Security

 MAKING INFORMED FINANCIAL DECISIONS: Have you ever been victimized by “financial scams”? Those too good to be true “investment opportunities” that promises spectacular returns in a very short time? Often, this is due to a low level of financial literacy. 

One of the bedrock principles of investment is RISK is always relative to RETURN, understanding this concept will immediately trigger alarms in the mind of a financial literate person and make him decide to stay away from such propositions.

Financial literacy equips individuals with the knowledge and skills necessary to make informed decisions about their finances. It helps them understand concepts such as budgeting, saving, investing, managing debt and the selection of the most appropriate investment based on own circumstances. With this understanding, individuals are better equipped to make smart financial choices, ultimately leading to improved financial security.

BUILDING WEALTH: Do you want to be rich? What is wealth to you? 

Financial literacy empowers individuals to take control of their financial future and build wealth over time. By understanding how money works, they can make strategic decisions about saving and investing, take advantage of opportunities to grow their wealth, and avoid common pitfalls that can hinder financial progress.

AVOIDING DEBT AND MANAGING CREDIT: Are there such things as “good debt” or “bad debt”? Financial literacy enables individuals to manage debt effectively and make wise choices when using credit. Taking a loan to buy a car may seem imprudent to some people, but if the "car" can accelerate one's career by seeing more people, helping more people, why not? 

Financial literacy helps us understand the consequences of excessive debt. By knowing how to manage credit responsibly, individuals can avoid excessive interest payments and reduce their financial vulnerabilities.

PLANNING FOR RETIREMENT: Working hard is good, but working till a ripe old age may not be something we all look forward to. We need to set a timeline as to when we stop chasing money and start making money work for us. We need to set our RETIREMENT DATE!!

Financial literacy plays a crucial role in preparing for retirement. It helps individuals understand the importance of retirement savings, investment strategies, and the various retirement vehicles available to them. With this knowledge, individuals can make informed decisions about contributing to retirement accounts, estimating future needs, and maximizing their savings to ensure a financially secure retirement.

NAVIGATING ECONOMIC CHALLENGES: Will the market recover this year? Will another crisis suddenly appear and cause another market downturn? 

Financial literacy provides individuals with the skills to navigate economic challenges and unexpected events. By understanding personal finance principles, they can create emergency funds, develop contingency plans, and make informed decisions during financial downturns. This resilience enables them to weather economic storms more effectively and maintain financial security even in challenging times.

Remember, building financial literacy is a journey that takes time and effort. Be patient with yourself and stay committed to continuous learning and improvement. Over time, as you gain more knowledge and experience, you'll become more confident and capable of making sound financial decisions.

All the best my friends!

#acgadvice

109. Do you have what it takes to become a successful Financial Advisor?

Being a successful financial advisor requires a unique combination of skills, qualities, and characteristics. While technical knowledge and expertise are essential, there are several non-technical traits that set apart exceptional financial advisors from their peers. In this blog post, we will explore the top five traits that contribute to the success of a financial advisor and how cultivating these traits can elevate their practice and benefit their clients.

1. Exceptional Communication Skills:

One of the most critical traits of a successful financial advisor is the ability to effectively communicate complex financial concepts to clients in a clear and understandable manner. Great advisors actively listen to their clients, ask insightful questions, and tailor their communication style to match their clients' needs and preferences. By simplifying financial jargon, using relatable examples, and providing regular updates, advisors can empower their clients to make informed decisions and build strong, trusting relationships.

2. Strong Ethical Standards:

Integrity and ethical conduct are paramount in the financial advisory profession. Successful advisors adhere to high ethical standards and always act in their clients' best interests. They prioritize transparency, disclose potential conflicts of interest, and maintain strict confidentiality. By placing their clients' needs first and consistently demonstrating ethical behavior, advisors build trust and long-lasting relationships based on integrity.

3. Empathy and Emotional Intelligence:

Financial decisions often involve complex emotions and personal goals. Successful financial advisors possess strong emotional intelligence and empathy, allowing them to understand their clients' unique circumstances, fears, and aspirations. By showing empathy, advisors can create a safe and supportive environment where clients feel heard and understood. They guide clients through both the rational and emotional aspects of financial planning, helping them achieve their goals while managing their fears and concerns.

4. Continuous Learning and Adaptability:

The financial landscape is constantly evolving, making continuous learning and adaptability crucial traits for successful financial advisors. They stay updated with industry trends, regulations, and market conditions. By investing in professional development, attending conferences, obtaining certifications, and staying informed about the latest financial innovations, advisors can provide their clients with the most relevant and up-to-date advice. Additionally, being adaptable allows them to navigate market fluctuations and adjust strategies to meet changing client needs.

5. Client-Centric Focus:

Successful financial advisors prioritize their clients' goals and aspirations above all else. They take a holistic approach to financial planning, considering not only investment strategies but also retirement planning, estate planning, tax management, and risk mitigation. By understanding their clients' unique circumstances, time horizons, and risk tolerance, advisors can develop customized solutions tailored to their clients' specific needs. They provide ongoing support, regular communication, and adapt their strategies as clients' circumstances change, ensuring their clients' financial well-being throughout their lives.

Becoming a successful financial advisor entails more than just technical expertise. The ability to communicate effectively, maintain high ethical standards, demonstrate empathy, continuously learn and adapt, and prioritize client-centricity are the traits that truly set outstanding advisors apart. By cultivating these traits, financial advisors can build strong relationships with their clients, inspire trust, and provide holistic and valuable financial guidance. Embracing these traits not only leads to professional success but also allows advisors to make a positive and lasting impact on their clients' financial well-being and overall lives.

All the best my friends!

#acgadvice 

108. Elements of Personal Branding for Financial Advisors

 

Authenticity: Personal branding starts with self-awareness and understanding your values, strengths, and passions. It is important to present an authentic version of yourself rather than trying to imitate someone else. Being true to yourself helps build trust and credibility with your audience.

Unique Value Proposition: Identify what sets you apart from others in your field. Determine your unique skills, expertise, or perspectives that make you valuable and relevant. This helps in positioning yourself as an authority or expert in a specific area.

Consistency: Consistency is crucial in personal branding. It involves maintaining a cohesive and unified message across various platforms, including social media, websites, networking events, and personal interactions. Consistency helps to reinforce your brand identity and allows others to recognize and remember you.

Target Audience: Understand who your target audience is and tailor your personal brand to appeal to them. Consider their needs, preferences, and expectations. By aligning your brand with the interests and values of your target audience, you can establish a deeper connection and attract the right opportunities.

Online Presence: In today's digital age, having a strong online presence is essential for personal branding. Create and maintain a professional website or blog where you can showcase your work, share insights, and engage with your audience. Additionally, leverage social media platforms to share relevant content, engage in discussions, and network with industry professionals.

Networking and Relationships: Building meaningful relationships is a crucial aspect of personal branding. Attend industry events, join professional organizations, and actively network with individuals who can support and enhance your brand. Collaborate with others, provide value, and establish a reputation as someone who is reliable and knowledgeable.

Continuous Learning and Growth: Personal branding is an ongoing process. Stay updated with industry trends, expand your knowledge, and continuously develop your skills. Position yourself as a lifelong learner who adapts to change and is always striving for growth. This not only adds value to your personal brand but also keeps you competitive in your field.

Benefits of Personal Branding:

Increased Visibility: A strong personal brand helps you stand out in a crowded marketplace, increasing your visibility and attracting opportunities.

Enhanced Professional Reputation: Personal branding allows you to shape and control how others perceive you, building a positive professional reputation.

Trust and Credibility: By consistently delivering on your brand promises and showcasing your expertise, you establish trust and credibility with your audience.

Career Advancement: A well-established personal brand can open doors to career advancement, new job opportunities, and industry recognition.

Networking and Collaboration: Personal branding facilitates networking and collaboration with like-minded professionals, leading to potential partnerships, mentorships, and knowledge sharing.

Personal branding is a powerful tool that enables individuals to differentiate themselves, establish credibility, and create opportunities in their personal and professional lives. By intentionally shaping and managing their brand, individuals can showcase their unique strengths, build relationships, and stand out in a competitive landscape. Investing time and effort into personal branding can lead to increased visibility, career advancement, and long-term success.

All the best my friends!

#acgadvice

107. The Crucial Role of "Personal Branding" for a Financial Advisor

 

In today's competitive marketplace, establishing a strong brand has become imperative for businesses across various industries. Financial advisors, in particular, cannot underestimate the significance of branding. Building a reputable brand not only sets you apart from your competitors but also cultivates trust, credibility, and loyalty among your clients.

Differentiation and Competitive Advantage:

Branding provides financial advisors with a unique opportunity to differentiate themselves in a crowded market. With numerous financial professionals vying for the attention of potential clients, a strong brand allows you to stand out from the crowd and establish a distinct identity. By clearly defining your brand values, mission, and unique selling propositions, you can effectively communicate what sets you apart and why clients should choose your services over others.

Building Trust and Credibility:

In the financial industry, trust is paramount. Clients are entrusting their hard-earned money and financial well-being to advisors, and they seek assurance that their investments are in capable hands. A well-crafted brand helps build trust and credibility. A strong brand signifies professionalism, expertise, and a commitment to client success. By consistently delivering on your brand promises and maintaining transparent communication, you can instill confidence in your clients, fostering long-term relationships and referrals.

Facilitating Business Growth:

A well-established brand not only attracts new clients but also helps in expanding your business. A strong brand presence makes it easier to generate referrals, as satisfied clients become brand ambassadors and recommend your services to their networks. Additionally, an established brand opens doors to strategic partnerships, media opportunities, and speaking engagements, further elevating your visibility and credibility within the industry. A recognizable brand can also command premium pricing, allowing you to grow your business and increase profitability.

In an increasingly competitive financial advisory landscape, building a strong brand is no longer optional—it is a necessity. A well-defined brand strategy helps financial advisors differentiate themselves, build trust, target the right audience, enhance client experiences, and facilitate business growth. By investing time and effort into developing a compelling brand, financial advisors can position themselves for success in a rapidly evolving industry. Remember, your brand is not just a logo; it is the embodiment of your values, expertise, and commitment to client success.

All the best my friends!

#acgadvice

105. To get a FREE copy of my 2023 Financial Fitness Forum presentation, follow these simple steps!

 

3 EASY Steps:

1. Please follow my blog

2. Send me an email (alijeffty@gmail.com) answering the following questions:

*what most concern you with regards to your financial planning?

*what topic would you like me to write about?

*tell me something about yourself

3. I will send you the download link to my presentation

thank you and all the best to you!

#acgadvice

104. Life Insurance can enhance your wealth building ability!

 

I have spent over 30 years of my career as a corporate executive in financial services companies ranging from Life Insurance, Mutual Fund to HMO operations, during this time I have met and became friends with quite a number of investment professionals and fund managers in my work in product development. 

When I decided to become a financial advisor in 2019, these "friends" of mine suddenly became unavailable, as what millennials would describe it - "na-seen zone ako!" ha ha ha

Thinking about it I guess the reason is that there is a common belief among investment professionals that they can invest their way to prosperity, that life insurance has no place in their portfolio. That based on the typical investment measure of ROI (return on investment), Life Insurance products will fail miserably.

I totally agree on this basis, that Life Insurance may be poor investments but there are some key points that these investment professionals may be missing.

Investment returns is the reward in the assumption of investment risk; more risk-more returns and vice versa, the success of any investment activities may mostly depend on the market and how it evolves in the future, what they may be missing is the most important component of any investment exercise which is the well-being of the INVESTORS themselves, what's the use of achieving the desired retirement funding targets if the investor is too sick to enjoy it?

I would be presenting some of these insights in my talk this coming Saturday June 17,2023 in the largest personal finance conference of the year - FFF 2023! I am told my slot would be at 4PM

I would focus on the 3 perils faced by the small investors!

see you there my friends!

#acgadvice

103.Can the US Debt Ceiling Issue can affect your client's portfolio

 #ctto

DISCLAIMER: Personal Opinion, not to be construed as financial advice

The United States has been on "trade deficit" for decades, in layman's terms this is spending more than what it is earning. 

To finance itself, it has resorted to borrowings usually by the sale of debt securities in the form of Treasury Bills and Notes, countries with surplus bought these en masse as there is no other outlet for their massive dollar holdings. China and Japan (countries with trade surplus with the US) notably held large quantities of these treasury securities.

As a check for fiscal responsibilities, the US Congress has set certain limits on how much the US government can borrow, this is the "Debt Ceiling" currently at $ 31.38 Trillion

As the US government has already spent most of it, it is now in a situation where it can default (because it run out of cash) which could lead to a lot of negative consequences, imagine a borrower of yours telling you that he can't pay what he owes you.. how would you react?

The current issue is whether the US Congress will allow the raising of the Debt Ceiling enabling the US government to borrow more.

If this is not approved, it may lead to a downgrade of US credit rating which will push US interest rates up as it will be deem "riskier" and will be forced to offer a higher rate - higher interest is generally not beneficial to the stock market so a portfolio rebalancing may be in order for our clients to reduce their equity exposure.

If this is approved this will lead to a deluge of new treasury bills issuance (some estimate up to $1 Trillion), as the US may maintain its credit rating and as these new supply starts flooding the market, this may lead to lower interest which will be beneficial to equities - for our client's portfolio maybe add on more equity exposure.

All the best my friends!

#acgadvice

102. Why should you be chosen over other financial advisors?

the prospect will choose you because:

• you represent the biggest insurance company?
• you have the most comprehensive coverage with the least cost.
• the investment funds you offer are the top performing funds in its class.

Selling life insurance is difficult if we consider the number of agents calling on the same prospect, because of this competition, it may have evolved into a "product contest", when agents compete against each other based on product merits and benefits, force selling it to the prospect without considering whether it is needed or not.

While these 3 points are quite valid and could contribute to your business, these are not sustainable over the long term. First, another company may overtake yours in terms of industry rankings, Second, products are created continuously, any advantage your product currently have might be overshadowed by a newer product tomorrow. Third, fund performance fluctuates, and not all securities move in the same direction all the time, the best performing fund today can be the worst if market condition changes, which it constantly does.

3 traits that advisors should have to remain competitive and be chosen:

1. Relevance - Keeping yourself updated with the latest trends in financial advisory, be it market knowledge or better ways to help clients achieve their financial goals, since the financial market is always evolving, we should constantly learn so we can give our clients timely and relevant advice.

2. Empathy - Clients don't need everything that we offer, some would be useful, but most would be redundant, clients may also not be in a position to buy any new product at this time, let's respect that and not force the client to a situation when they have to "reject" us.

3. Always! the client's best interest - You are one case away from qualifying to that incentive trip ending today, the prospect is having second thoughts and would like more time to consider, what do you do? 

All the best my friends!

Feel free to ask questions in the comments section

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101. Are VULs really better than bank deposits? It depends on the "context" on how it is presented

 

The staple pitch among financial advisors is comparing the "rates of return" of a savings account with the projected returns of a VUL, how the low interest rate of a savings account is not overcoming the negative effects of inflation over time leading to significant losses in purchasing power.

While data has shown the outperformance of funds over a savings account, this must be presented in the proper context.

First is that the nature of the returns is not comparable.

A savings account is categorized as a "lending" type of vehicle, that by depositing the money in a bank, we are effectively lending the money to the bank in return for compensation in the form of interest. This rate is normally fixed and the funds are withdrawable anytime.

The liquidity (withdrawable anytime) of a savings account is the reason why rates are normally very low.

A VUL (or mutual funds/UIT) is categorized as "owning" vehicles, that money invested is replaced by ownership (units/share) in the fund at the price the investment is made, for example funds are invested in ABC equity fund selling for Php 2/unit, a Php 10K investment will now be converted to 5,000 units of the fund (Php10k/Php2/unit) assuming zero transaction costs (entry fees, COI, etc), how much the returns would be going forward will be dependent on how the fund is invested. So if the fund is an equity fund (predominantly invested in the stock market), the price of the fund will be how the stock market behaves going forward.

If the market goes up, the price of the fund will follow resulting in some gains for the investor, but if the market went down, the price of the fund will also drop. The best way to handle this volatility (ups and downs) is to hold on to it for longer periods of time.

It is not withdrawable anytime because to cash in, you have to sell your ownership (units/shares) at the prevailing price, which could be lower than your purchase price.

Having said these, are VULs better than bank deposits?

It really depends on the timing and intent of your investment decision.

• If your current excess funds are meant to act as buffer for any income shortfall, you need liquidity so a savings account is better.
• If your current excess funds are meant to finance a "financial goal" happening years into the future, then a fund (whether a VUL, MF or UIT) may be a better option.

All the best my friends!

#acgadvice

100. Why some people don't like to talk to agents

If financial advisory just another selling job?

If we are to base the answer on the proliferation of popular seminar topics in the industry today (selling to the HNIs, objection handling, consultative selling, always be closing etc..), success in financial advisory is now a function of how well we sell products!

To me, focusing on just developing selling skills to build a career on financial advisory may or may not bring you to the accomplishments you envisioned. This is because approaching prospective clients with a "salesman" mindset will influence how we approach and talk to them - a salesman will focus on making a sale as an objective and if is not forthcoming, may lead to a contest of wills with the advisor using "sales techniques" to try to overcome objections and the prospect defending his decision with more objections, more often than not, this leads to negative outcomes.

Financial advisory is more on advocating financial literacy, to know and understand enough financial concepts and options to be able to make informed financial decision; whether it is to have enough funds to meet important life goals or passing on critical risk elements that may place these goal attainments in peril.

Financial advisory is all about "educating" prospective clients on how best to invest his current excess funds considering his personal circumstances, his risk/reward preferences, how market conditions may affect the outcomes, possible risk in the horizon etc.

Financial advisory is all about helping prospective clients make an "informed financial decision"! And if they decide that we are their best partner in their financial journey, then we have a sale!

• A salesman focuses on making a sale!
• An advocate focuses on sharing information that would help prospective clients understand where he is right now in his financial journey relative to where he wanted to be, options available to him and the best way forward. And whether they decide to buy or not is another matter.

Changing how we approach prospective client from a salesman mindset to an advocate mindset may be the better way of building a more sustainable financial advisory career!

All the best my friends!

#acgadvice

99. Does a "diversified stock portfolio" guarantees returns?

 Harry Markowitz: Creator of Modern Portfolio Theory (investopedia.com)

There are hundreds of stocks listed in the Philippine Stock Exhange, if you are to design a well-diversified portfolio, which stocks will be select?

Diversification is the idea that not all securities will move in the same direction at the same time as each stock will be affected individually by changes in market conditions. For example, the OPEC announced a hefty price increase in the price of crude oil, among the listed companies - oil companies may benefit from this and see their stock price rise while companies dependent on oil like transport companies may see their operating margins shrink leading to lower stock price. By combining these two companies in a portfolio, the price drop of transport may be balanced off by the increase of oil companies' stock price.

A portfolio is a collection of assets (stocks) created by the investor intended to transfer the "purchasing power" of excess funds into the future.

Investors can design a portfolio made up of these individual stocks so that the overall return of the portfolio will be more predictable. 

The "Modern Portfolio Theory" was first published in 1952, it was discussed more extensively in the Markowitz's book "Portfolio Selection" in 1959. Here are some key ideas.

Portfolio design can be reduced to two dimensions - First is the expected return and its risk (as measured by the probability that it may not deliver the expected return - it's variance)

The risk of each stock that really matters is not the risk of the stock by itself rather its contribution to the risk of the aggregate portfolio.

With this insight, Markowitz was able to reduce the complicated and multi-dimensional problem of portfolio construction. From an investor's perspective, the more assurance that actual returns will parallel expected returns, the better!

The objective will be a portfolio with the highest expected return with the lowest variance.

Data needed are: 1. the estimated expected return of each individual stock and 2. the variance of its return and 3. the co-variance of the stock returns in relation with other stocks in the portfolio.

Diversification: Why Not Put Everything in Whatever Will Go Up the Most? – Marotta On Money

While a diversified portfolio is no guarantee of future returns, it increases the sense of comfort for investors that the actual return will not deviate too much from the expected return.

All the best my friends!

#acgadvice

98. If you forget your goal and just focus on your "system", will you succeed?

 

Winners and Losers have the same goal, the only difference is one achieves it while most others fail. If we are to apply this to the total number of financial advisors vying to qualify for the Million Dollar Round Table each year, statistically, just by setting a goal to qualify for the MDRT does not work!

The prevailing wisdom says that for us to achieve anything we want in life, we need to set goals and tie it to an action plan, Jim Collins even coined the term BHAG for "Big Hairy Audacious Goal", the idea is that the bigger, clearer and more well-articulated the goal, the more likely we are to achieve it, because it would constantly inspire and motivate us to reach it!

Inspiration and motivation are not sustainable! just look at new year's resolutions!

One interesting insight I gathered from reading James Clear's book "Atomic Habits" is that "Goals is just a standard to let you know you won the game" while "Systems is a set of habits that allows you to continue playing the game" even after your current (goal) game is won, the system will enable you to play bigger games in the future, one that builds from your latest success. 

A Habit is a series of Behaviors.

A System is a series of Habits.

Success habits for financial advisors are "Prospecting" and "Presenting", setting up a system to embed these two activities in our daily habits is the sure-fire way to success!

Building habits are daunting at the beginning, imagine telling yourself to make 5 client calls a day as suggested by a sales guru, you may do it for a day or maybe two, but as it goes on the weight of rejections may start demoralizing you and you most probably will give up after a while. The key idea is to develop habits to make this automatic!

BJ Fogg in his book "Tiny Habits" suggests breaking down the task to its smallest possible version - so making a client call may just become browsing your contacts in your phone directory. 

Next is to identify an "action prompt", this will tell you when to start a new habit, Fogg suggests tying this to an anchor (a habit you are already doing regularly like having coffee in the morning?)

Your anchor - After I ... (had coffee), the new tiny habit - I will.. (browse my contact list). browsing is much less intimidating than making an actual client call, its easier and you don't need a lot of motivation to do it, so it is an easier habit to create. But just browsing your contacts will not make you any money, you have to "grow this habit", How? 

By celebrating your small success (browsing your contacts)!  After browsing congratulate yourself for a job well done! It may sound ridiculous in the beginning to celebrate such an "insignificant" action, but the positive feeling generated will encourage you to repeat the habit again, this momentum that you have created may now give you enough motivation to repeat and grow this habit.

So the next habit that you formed in this progression may be, After I... (browsed my contacts) I will... (send messages to 3 of them requesting for an appointment)

Celebrate this and grow this to an even bigger habit till you are making 5 client calls a day!

Success is the result of what we do every day, and habits are what we do regularly, embed a new habit that would lead to your achieving your goals to a habit you are already doing will help ensure you do it everyday.

Read "Atomic Habits" (James Clear) and "Tiny Habits" (BJ Fogg | Tiny Habits) for more insights!

All the best my friends

#acgadvice

97. Q&A from "Selling Certainty in an Uncertain Market" Special Interest Session - April 27, 2023

 

Advisor question 1: My client has been invested since 2018 but is still losing money, we have implemented asset allocation and it seems not to be working.

Me: May I ask what your allocation is?

Advisor answer: 100% equities

#acgadvice - Asset allocation on the fund level: Knowing that the funds we offer follows an asset allocation strategy may have caused this confusion, an equity fund for example may be allocated to different companies, all these companies however are still ALL invested in the stock market. So, when we experience a general market downturn, the whole investment will be affected.

Asset allocation from the client level: Depending on a client's risk tolerance and time horizon, his investment is allocated to a percentage in an equity fund (40 to 80%) and the balance in a bond or money market fund. The idea is that traditionally stocks and bonds move in opposite directions, by combining these two contrasting funds in a portfolio may temper the effects of natural volatility of the market, periodic review and re-balancing may also provide a mechanism to take advantage of short-term fluctuations. For more info on asset allocation read my blog post #40. Does Asset Allocation really work?

Advisor question 2: My client asked me to prepare a proposal for Critical Illness Coverage, I prepared a 5-pay plan, the premiums to be paid are almost equal to the amount of coverage, this may discourage my client from buying as this shows a very poor return on the client's capital.

#acgadvice - Apples and oranges are not comparable so is life insurance and investments as asset classes, measuring the benefits of a life insurance coverage using an investing metric (ROI) may be the wrong way of determining the true value of a life insurance coverage

Insurance premiums are typically one to five pesos per one thousand pesos of coverage, so using an ROI metric to evaluate the cost/benefit relationship, would this translate to an astonishing return?

The true value of a life insurance coverage (to include CI coverage) should be measured based on 3 factors: First is the stability of the insurer (ensure that the insurance company would outlive you, look at assets and net worth). Second would be Comprehensiveness (what are the number of illnesses it would cover) and lastly third is Adequacy (is the amount of coverage adequate to cover most expenses associated with critical illness), once these are determined, buy the policy with the longest payment terms available (best is 20pay)

Advisor question 3: My client invested in our VUL, because of the associated insurance charges (Cost of insurance, rider premiums, etc.), it always underperforms relative to mutual and unit trust funds.

#acgadvice - This is again a case of trying to compare an apple with an orange, pure investment funds don't have insurance costs, so they also don't have insurance protection

consider an investment with a 20-year time horizon, in twenty years the investor will get old, as he gets older the chances of him getting sick becomes higher, what if midway in his investment horizon he contracted a critical illness? he may have to take out money from his investment to pay for treatments, because the funds are now spent, he may have to forego the realization of his financial goal.

Getting a VUL with CI rider will mitigate this risk, if the same scenario happens, the investor simply claims on CI rider to cover his medical expenses, his investment fund would continue to grow allowing him to realize his financial goal.

All the best my friends!

#acgadvice