Transcription
What's up everybody, and welcome back to the Seven Figure Annuity Sales Podcast. It's Caleb North here with you today, and you know, I had something on my mind that's come up a couple of times this week, actually, in working with agents. And you guys have heard me intro probably tons of podcasts that way by now. I really get a lot of the ideas for what I talk about here from what I'm having conversations with agents about during the week.
And there have been a couple of uh instances this past week where I, I've been asked, you know, by agents, "How should I pitch this? How should I, how should I pitch this annuity? How should I, how should I try and position it, sell it, whatever?" And it's really kind of caused me to start thinking through both the mindset of the agent and the mindset of the client. And what I responded to those agents with was, "Well, what do they need?"
And before I get too far into this, no, this is not a podcast explicitly about the importance of fact-finding. Um, but I am going to share with you guys a few questions that we ask on our fact-finder that you could implement today with your clients or any appointments you have that will change, I guarantee you, change and impact the quality of those appointments and your ability to write the business. Um, so they would ask me that. I said, "Well, what do they need?"
And what I realized was, number one, they were newer agents. They hadn't actually done a fact-finder yet. So they didn't really know what the client needed, what the client was even really looking for. It was, it was more of a, "Hey, here's a situation. What type of product should I try to sell this person?" And it was a good conversation for me to have with them because I was able to help them realize, like, "We're getting the cart ahead of the horse here by selecting a product before we even know what they need, what their goals are." So, you know, we use the opportunity to talk through the fact-finder, which is super important.
But here's the deal, guys. If you get a good fact-finder, they will tell you how to sell them on the fact-finder. Like, there are questions on our fact-finder that we use that if you can get that information, it quite literally is the client telling you how to position your solution to them in a way that matters to them. So it's a, it's a hack the system type of deal. Not only does it give you the information you need to be able to put together a decent case design, but it quite literally tells you what is going to work to sell them on the concepts that you're, that you're positioning. And it's all rooted in problem-solving, and it's all rooted in needs. It's all rooted in goals. Okay? So, it's not about, you know, flashing shiny objects and trying to get them to buy into the, you know, latest, greatest, hottest thing. It's, you figure out what they need and you solve it. You figure out what their problem is and you solve it.
Now, that said, I told you this isn't going to be a podcast about the importance of fact-finding, although we could probably hit that every single week and uh, there'd still be people not necessarily doing fact-finding the way they should. But I want to share with you guys some very practical questions that we ask on our fact-finder. Not the whole fact-finder. I'm not going to give you away the secret sauce on the free podcast. Um, but I am going to share with you a couple of questions that absolutely, I guarantee you, will help your appointments and help you get into the mind of your client.
See, here's what I've realized in working with agents is agents who write really, really good business are not necessarily people who are good at convincing other people that what they have is awesome. They're good. They're really, really good at understanding the way their client thinks and reframing what needs to be reframed. Okay?
So, the first question that I think about on our fact-finder that helps you get into the mind of the client is a question toward the top of our fact-finder. By the way, our fact-finder is a one-pager, okay? So, it's not crazy at all. You can go through it in literally a matter of 10 minutes with a client if you're, if you're kind of working through it pretty quick. It's not crazy. It's not scary to them. It's not a, you know, a packet of pages that, you know, they feel like they're sitting at the doctor's office getting an intake form or something. It's just one page and it has everything you need. But one of those questions toward the top of that fact-finder is this: "What is a reasonable rate of return?"
And you might be thinking, "Caleb, what in the world does that even have to do with me selling an annuity?" And my response would be, "Nothing and everything." Okay? Because what they need the annuity to do may not be anything related to accumulation. They might need an income play. Okay? U, but getting an idea for what they think is reasonable is impactful. Now, I will say that question is going to be more impactful for those cases that you determine later on in the fact-finder are actually accumulation needs. Okay? But you're going to ask it regardless. And here's what it does.
Number one, if they actually have an idea of what a reasonable rate of return is in a portfolio or whatever, it allows you to show them rates at least currently that can return better than what they say is reasonable. So, here's what I mean. Let's look at the last 25 years of the S&P 500 performance. If you go back from 2000 and you look at every year since, at least, you know, at the time that I'm recording, it's like between a seven and 8% average return since the turn of the century. Okay? So, two and a half decades.
Now, right now, a lot of people have recency bias because the last 5, 8, 10 years has been stellar in the market, right? We've had a couple of little hiccups along the way. You think 2020 COVID, 2018, we've had some, we've had some hiccups in there, but by and large, it has been just the market's just been on an absolute tear, mega, mega bull run. So people sometimes have this unrealistic expectation that that's the norm, and it's not the long-term norm. It's the short-term kind of thing we've seen.
But what that question allows you to do is understand, "Does this person have a reasonable expectation, or are they currently living in a place of recency bias?" See, if somebody comes back and they say, "Oh, you know, 6 to 8% is reasonable," they would be correct. That's reasonable. And when you look at the historical performance of the S&P 500 and you kind of consider that the benchmark for the stock market, yeah, that's, that's reasonable. Uh, if they come back and they say, "Oh, well, you know, 15 to 20% per year is kind of what I've been seeing, you know, lately." It's like, well, now you have an opportunity to help them understand that what we've seen recently isn't necessarily the long-term norm. And you're able to kind of reframe a little bit. So you, you see now where their headspace is, and now you're able to reposition and reframe what is realistic. Okay?
And it's not to try and give these people advice into or out of uh, you know, stock positions, securities. It's not to advise them. It's merely to look at the history of what we can see has factually happened and say, "Hey, if you know, your expectation is a 15 to 20% return every year, looking at the long-term average, that's probably not a realistic expectation. So, what would be a realistic expectation?" And so, you're able to kind of reposition that and reframe that.
And here's why that's impactful. Right now, we have caps that are, let's just say, 10% on the S&P 500. Uh, we've got participation rates right around the 50% mark. Okay? So, if somebody comes back and they say, "Oh, I, you know, I'm expecting 15 to 20%." If you never knew that and you go in and you position a product that has a cap of 10, what do you think they're going to think about the product? They're expecting 15 to 20 because their expectations are not realistic. So they might tell you that, "Hey, that seems low." Or they might just ghost you. They might just decide subconsciously, "I'm not going to do this. I'll be kind and cordial about it, but I'm just not going to work with you." And then you never hear from them again because they were operating out of a preconceived notion that was incorrect. Okay?
So you got to get into the mind of the client to understand their expectations so that you can temper the expectations to reality if that's needed, or if they do say something more realistic, like say 6 to 8%. Now you're able to reference back to that when you show them the illustration that you're going through. So let's say your illustration has a 10% cap. You can go back to your fact-finder and say, "Hey, listen. You know, you told me that you you felt like a reasonable expectation for a return is 6 to 8%." Well, I want to show you that this particular product actually has a ceiling of 10 on the S&P 500, but without any of the downside. So, the opportunity for you to get what you are expecting as a realistic return is very, very much there. It's very real, and you're simultaneously protected from the losses in those years where that happens.
And so it allows you to get into the client's head and either utilize what they say is their expectation or temper their expectation to something that's more realistic and then still use it in that way. So that's one question.
The other question that's right next to it on the fact-finder is, "Hey, what's a reasonable rate of withdrawal from your accounts?" Like, if you're going to use these accounts for retirement income, what do you say is a reasonable rate of withdrawal? And this is another opportunity for them to actually say something that's reasonable, you know, 3 to 4%. Or they've heard the, you know, Dave Ramsey's out there talking about, "Oh, the market's averaged 10% for the last 10 years. You, you're telling me you can't pull eight? Where's the other two going?" They might think they can take way, way more than what they can. And again, you're going to want to temper that. And now you've got a talking point where you can show them numerically why even withdrawals so high as 4% can lead to failure in the plan. They can run out of money depending on what happens in the sequence of returns of those strategies.
The other thing that that question does for you is if you determine, "Hey, we're going to actually position an income product here." They have a, you know, a monthly shortfall of, let's say, two grand. So, we got to make up $24,000 a year. Their plan was to pull that out of their, you know, you know, investments, whatever their their accounts in retirement. Just follow the 3 to 4% rule, however you want to, you know, word that. And what you're able to do is take a portion of their funds, place it into an income-generating product, and get them all of the income they need guaranteed for life. And if their reasonable expectation for a return is say 3 to 4%. And your withdrawal rate is 8 to 10% of their initial premium and guaranteed income for the rest of their life. It allows you to show them that in this particular product that you have, they can actually take maybe twice as much as what they were expecting is reasonable and simultaneously guarantee that withdrawal for the rest of their life, regardless of how long they live, regardless of what happens in the market.
Now, that account value might dwindle over time, right? They might see that account value dissolve in 12 to 15 years. But if you're only having to use a portion of the funds, that allows you to take the other portion of the funds, leave it in something else that you're not drawing from and is purely able to accumulate. So those two questions help you get into the mind of the client to help see what are their expectations. Do I need to temper those expectations down to reality? Or can I utilize those expectations to show them that even their reasonable expectations, we can do better in the product that we're, that we're positioning?
There's one other question um that's a little bit less related to the sale of the product and actually positioning the product, right? Pitching a product, and a little bit more related to figuring out, "Is this an income play or is it an accumulation play?" And it goes like this: "Is this a plan for living or a plan for dying?"
Some of y'all might have heard us talk about this before. If you're asking clients, "Is this an income plan or an accumulation plan?" You're setting yourself up to sell a bunch of accumulation plans because you're not getting out of the paradigm of their preconceived notions that are probably incorrect. See, if you ask them, "Is this a plan for income or a plan for accumulation?" You are subjecting the information you get from them to their understanding of how income and accumulation works. And that understanding could be wrong. In other words, you could be setting yourself up to get an answer that is not what they're actually needing.
You have to understand that for the last 30 or 40 years, these people have been working, and the whole mental concept is accumulate, accumulate, accumulate, build these accounts, build these accounts, build these accounts, grow, grow, grow. You are not going to, in a five-minute conversation with somebody, somehow shift their mentality out of accumulation that's been there for 30 or 40 years. If you ask it that way.
And here's the other thing. If you ask it in that way, "Is this a plan for income or a plan for accumulation?" Even if it's a plan for income, you're setting yourself up to get an answer that says accumulation because they very well might synonymize accumulation with the ability to take more income. The other thing is that you're positioning it as mutually exclusive. We can't have both. And it's true. If you're going to have a product that's generating a lot of guaranteed income, you're not going to see that account value accumulate. And if you're going to see good accumulation in an account value, you're not going to have very much income coming out of it. So, by effect, yes, they are mutually exclusive. But if you position it in that way, you're creating a a situation where now the client is biased toward accumulation, even if they need or want income. Because when you position them in that manner, the only way in their mind that they get more income is by having more accumulation.
So I guarantee you if you ask, "Is this a plan for income or a plan for accumulation?" you're going to be getting, you know, nine out of 10 say accumulation, accumulation, accumulation, and you're just going to sell a bunch of accumulation products. And then three years later, they're going to come back to you trying to figure out, "Hey, how can I get income on this? How can I make my withdrawals?" And you're like, "Well, you said it was for accumulation." And they're like, "Well, yeah, but, you know, I needed to accumulate to get income." It's like, you've done a poor job of fact-finding as an agent if that's the the situation that you find happen.
There is a better way to ask that question. And it goes like this: "Is this a plan for living or a plan for dying?" In other words, are you going to use this money to live on while you're alive, or are you planning to pass it on to heirs and beneficiaries? This retirement money that these people have only has two purposes. You have to understand, there is not a third purpose. They will either live on it while they're alive, or it will be passed to heirs and beneficiaries. I guess the third is, you know, some of it will be used for taxes. Okay? But that's largely going to be as a subsequence of them using it to live on. There are only two outcomes for this money.
By asking it, "Is this a plan for living or a plan for dying?" you eliminate their preconceived notions about how accumulation or income works, and you are getting to the root of what the money is supposed to do, the end of what the money is supposed to do. So if in their mind they think they need to have accumulation to eventually have more income, they will say it is a plan for living. You see what I'm saying? And if the actual need that they have is only to pass this on to heirs and beneficiaries, they will say, "No, it's to pass it on to heirs and beneficiaries. It's a plan for dying."
Now you can determine, "Is this an income play or is it an accumulation play?" If they say it's a plan for living, nine times out of 10, it's going to be an income-generating type of product that you position. But you're eliminating their preconceived notions about how income and how accumulation works. So again, we're using the question and wording the question in a way that allows us to understand the client's mind and what they're actually looking for, what they're actually needing.
Those three questions will revolutionize the way that you position your products to your clients. "What's a reasonable rate of return?" "What is a reasonable rate of withdrawal?" "Is this a plan for living or a plan for dying?" And if you will ask those three questions, I guarantee you, you will see more business being written. And it will be better business written. You will be addressing the client's needs and desires in a far greater capacity if you'll ask those questions that way.
Now, again, that is only three of plenty of questions on the fact-finder. And for those of you that are in our training program, you can go to the resource vault. You can download the fact-finder. You can use that fact-finder exactly the way Chad and Jesse use it. Guys, this fact-finder is responsible for, I mean, hundreds of millions of production. I mean, at this point, honestly, it's got to be getting close to, I mean, between Chad and Jesse and all the agents using it, we're, we're over half a billion dollars in annuity premium that you can look at was placed that you can trace back to the fact-finder. Like, this thing stinking works.
So, if you're not in our training program, I actually am excited to tell you, we're going to be opening up a three-month intensive called Annuity Accelerator that's going to start in January of 2026. Okay? And if you're trying to fast-track your annuity production, your training, your ability to write really good annuity business, if you're trying to fast-track it, jump into Annuity Accelerator. Reach out to us. We'll be able to get you plugged into that thing. Um, if you're trying to just kind of take the, the slow route and you want to kind of, you know, self-serve as you as you have the time and the capacity, you don't necessarily want to commit to a three-month program, a three-month intensive, might take you a little bit longer, but you could get into our Annuity Architects program.
In both scenarios, you're going to get the training content, and you're going to get access to this fact-finder that I guarantee you will change, change the way you write your business. But even if you don't, you choose not to do any of that, use those three questions and watch what happens in your appointments with your clients.
So, hope this helps you. And as always, happy selling.