Blog

Financial Friday Round-Up: October 19 – October 23, 2020

Welcome to the Financial Friday Round-Up, where we scour the web for the best things to read, watch, or listen to regarding finance every week. Check out the links below for advice on preparing your taxes as early as today, strategies for a strong fourth quarter, a report on gas prices, and more.

Side Hustles Are Helping Many Close The Income Gap In The Pandemic—Here’s What To Look For

A report from Forbes shows that second jobs have been helping many to support themselves in the pandemic, and a significant portion of the workforce has been getting creative when figuring out how to generate a supplementary income. The number of freelancers has been steadily growing, along with their demand — read here for many inspiring side hustle stories.

If You’re Unemployed, Working From a New State or Freelancing Due to the Pandemic, Start Preparing Your Taxes Now

Next year’s tax season is set to be a tumultuous one with many Americans accounting for big changes when filing, be it a job loss, unemployment checks, or freelance work on the side. It never hurts to get started early, and this useful article from Money outlines everything you may need to take into consideration for the next tax deadline.

3 Strategies Champions Use to Win The Fourth Quarter

Worth published a motivational piece on how leaders can inspire themselves to lead confidently and courageously during the fourth quarter. Read this for strategies on how to be a great leader, including training your body daily, elevating your thinking, and demanding excellence from those around you.

Gasoline Prices to Cool This Fall

This short report from Kiplinger forecasts that gas prices — which have already held steady at around $2.17 per gallon for a while — are looking to fall slowly to around $2 toward the end of autumn. Read this for a better look at how demand affects oil prices and why this dip in price may come to be.

Check out our other Financial Friday Round-Up posts for more great reads!

Financial Friday Round-Up: October 12 - October 16, 2020
Financial Friday Round-Up: October 4 - October 9, 2020
Financial Friday Round-Up: September 28 - October 2, 2020

Every Client Needs to Know About their Annuity Options

COVID-19 has brought the world into an unprecedented economic phase and it is more important than ever to ensure your clients that you can protect their financial security — and any financial plan you propose is incomplete without the mention of their annuity options.

Annuities are generally left out of the conversation because they can be confusing. They use many specific terms and lack mainstream exposure. Still, your clients need to know they are available, and there is a simple way to explain them — they are accumulation vehicles for clients to provide money for their retirement.

Three big areas of uncertainty in 2020 make annuities more essential for your clients now than ever.

1. Economic Uncertainty: More Americans are unemployed today than at any time since the late-1970s. Many will need to do significant financial planning to keep their retirement savings for when they return to the job market.

2. Political Uncertainty: Elections have an effect on American businesses and whether economic returns will go up or down. Our current political climate can wreak havoc on clients’ investments, making lower-risk options a safer choice.

3. Market Uncertainty: This year saw the fastest decline ever in the market in March and April, followed by a rapid rebound. Indexed annuities can protect clients against these types of rapid market changes.

It is important that you understand what solutions you have at your disposal for your clients. Fixed Indexed Annuities and Single Premium Immediate Annuities are going to be particularly helpful for today’s economy — but first, we will need to better define annuities.

"Any financial plan in today’s uncertain times is incomplete without the mention of annuities."

The Annuity Explained

One of the main uses for annuities is to calm fears about outliving one’s assets by establishing steady cash flow during retirement. They operate like life insurance in that clients choose to put money into a policy which, at a certain point, is paid back with accumulated interest. With life insurance, it is more or less paid after the owner’s death; with annuities, it is paid at the owner’s retirement to guarantee an income for their retired life. The payments can be guaranteed for a number of years, for life, or a little of both.

When discussing annuities with your client, have them answer three key questions:

1. At what age are they looking to retire?

2. How willing are they to pay fees for features like protection against a market downturn?

3. Are they willing to incur risk for bigger gain potential in future payments?

While you always want to present the benefits of annuity products, remember to educate your clients on annuities being somewhat illiquid vehicles, meaning the funds should not be touched during what is called the “surrender period,” or the time before the payments will be distributed. For best results, a client should plan to “park” the money until the planned distribution phase. Unlike a savings account, a client cannot withdraw all of their money early without a (hefty) surrender charge or fee.

Annuity Phases

Annuities are accumulation vehicles with two distinct phases: the accumulation phase, when the client funds the annuity, and the distribution phase, when the payments to the client begin. One confusing aspect of annuities is the many different types based on these two phases, each with different features that could help a client’s specific lifestyle. In general, there are two main accumulation types (fixed or variable) and two main distribution types (immediate or deferred) for annuities, which we go into below.

"Annuities were developed to calm fears about outliving one’s assets by establishing steady cash flow during retirement."

Accumulation Types: Fixed and Variable

These two categories relate to how the policy grows its funds. Fixed annuities are not tied to any market, and therefore have a fixed interest rate that provides regular periodic payments to the client. A variable annuity is based on stock market performance, giving the owner the chance to receive bigger payments if the investments do well. This means the cash flow is less stable but allows for better rewards. To protect against this downside, there are also some hybrid annuities, such as the Fixed Indexed Annuity.

Fixed Annuities

Also known as the CD-Type annuity, fixed annuities have a guaranteed rate and term (i.e., 5 years at 3% guaranteed), are almost always single premium (meaning customers cannot add to them), and usually have interest-only or 10% free withdrawals (though it depends on the contract).

Variable Annuities

These annuities are invested in sub-accounts, similar to how mutual funds are built and tend to have higher fees annually (4% or more), thus reducing returns. Agents must have a security license to sell or advise on these.

Hybrid Annuities

“Trust Me” Annuities are a blended annuity with a fixed interest rate for the first year or so (which is specified by the contract) and afterward adjusts according to the bond market.

Fixed Indexed Annuities provide interest annually by a certain index that is tied to the stock market. This is not a direct investment in the stock market, so there is no downside risk for clients, similar to an IUL. Interest is invested in one of several indexes, most commonly the S&P 500. This is a great option for clients who have

Financial Friday Round-Up: October 12 – October 16, 2020

Welcome to the Financial Friday Round-Up, where we scour the web for the best things to read, watch, or listen to regarding finance every week. Check out the links below for how to avoid a flaw in your customer service plan, what not to keep in your wallet, whether you should save for your kids even before you become a parent, and more.

How To Solve This Fatal Problem In Customer Service And The Customer Experience

This piece from Forbes describes a flaw in many customer service plans that they call the Cliff of Dissatisfaction — the moment a customer loses faith in your ability to meet their needs enough to jump to your competition. This article argues the importance of monitoring customer satisfaction and restlessness for the survival of your business.

What I Wish I Knew About Customer Service as a New Entrepreneur

Customer service is often only thought to apply to retail and food service workers, but it is just as essential for small business owners to provide a positive experience for their customers. This piece from Inc gives three concrete tips for how to better focus on customer satisfaction.

10 Worst Things to Keep in Your Wallet

There are some things you should never keep in your wallet, things that are too important to ever risk getting stolen. This quick Kiplinger list covers the basics — social security card, passports, spare keys — as well as some things you may not have thought of like multiple credit cards, stacks of receipts or gift cards.

Is It Crazy to Start Saving for Kids Years Before You Plan to Become a Parent?

There is no disputing that children are expensive — this article from Money cites that $234,000 per couple is spent covering the first 17 years of one child’s life. So should you start saving up for one even if you have do not plan on conceiving for a long time? In short, this article’s answer is yes; read more to hear why.

Check out our other Financial Friday Round-Up posts for more great reads!

Financial Friday Round-Up: October 4 - October 9, 2020
Financial Friday Round-Up: September 28 - October 2, 2020
Financial Friday Round-Up: September 21 - September 25, 2020

Five Simple Steps for Outstanding Customer Service

If you were to ask someone what the most important building block of a business is, what do you picture them saying? Would it be marketing? Technology? The product itself? All of these answers are close, but too often we miss the most important aspect of our business — the customers. Without customers, businesses serve little purpose. Yet customer service is often overlooked, especially for new entrepreneurs.

Too often, business owners think that customer service only applies to retail and food service, but the truth is that it is even more important in industries like insurance where keeping a good relationship with your client is key. Nothing will give you an edge over your competition quite like a positive customer experience. Thankfully, there are some simple steps you can build into your business that will greatly improve your customer service and keep your clients satisfied.

The Key to a Positive Customer Experience

Customers can seem like mysteries at times, but good customer support is much easier than you think. Simply put, customers are people, and people want someone who will listen, someone they can trust, and someone who is reliable. They want simple respect and meaningful interactions. Good customer service can be as simple as a smile, a bright tone of voice, or a friendly greeting.

Aside from the benefit of treating people right, customer service helps in many other ways — those who have a positive experience with your business will in turn give you free word-of-mouth advertising. This is the most trusted form of outreach, as people are much more likely to take recommendations from a trusted friend than an advertisement. Then, along with a return customer, you will have established a new customer as well.

Good customer service can also mean giving customers the opportunity to let themselves be heard. Give them a chance to give you feedback, both so you can know how to improve and so they know you are listening to them. Ask for feedback whenever you can using three essential questions: “How can I help you?” “How was your experience?” and “How can I do better?”

“Simply put, customers are people, and people want someone who will listen, someone they can trust, and someone who is reliable.”

Simple Steps to Improving Customer Service

When it comes to what they expect out of a business, everybody is different. This can be tricky when developing a customer support policy. Some people like being greeted at the door and heavy engagement; others prefer to be bothered as little as possible. However, there are a few things you can do that will apply to nearly everyone.

1. Be personal — Calling a customer by their name is a simple way to let them know you are there for them. Use their name as often as possible, both in person and in writing.

2. Be honest with your mistakes — If something goes wrong, own up to it right away and be proactive with fixing it.

3. Be easy to reach — Offer the choice to contact you and your team both online and by phone, depending on the customer’s preferred method.

4. Remember birthdays — A simple birthday wish is an easy way to remind customers you care.

5. Prioritize customer problems — Solve the most urgent customer problems first to avoid complications or the flaring of tempers.

“Remember birthdays — A simple birthday wish is an easy way to remind customers you care.”

Put Your Policy in Writing

The final step to any customer support policy is to put it in writing for the benefit of your team. Even the simplest list of rules — like saying “please” and how to handle certain mistakes — will make your business run more smoothly. Communication with your team is essential to keeping their stress levels low and their confidence high. Reward the team members who do exceptionally well so they will stay passionate about serving their customers.

Remember that customers can make or break a business. What sets you apart from your competition is, ultimately, what your customers think of you. Conduct your business with them in mind and you will have little trouble becoming a successful entrepreneur.

Read our previous posts on thriving in uncertain times and staying motivated.

FFS Agents - share this post with your networks using our resources in the ABO.

Financial Friday Round-Up: October 4 – October 9

Every week, our Financial Friday Round-Up compiles the best things to read, watch, or listen to regarding finance on the web. The articles below include a round-up of retirement podcasts, a list of 25 thriving small business owners, how to prepare your financial information for when you die, and more.

How to Prepare Your Financial Information for When You Die

“I think this is one of the most important financial tasks that any individual, retired or otherwise, should tackle—spelling out “last instructions” if you become incapacitated or die. In doing so, you spare your family much work and heartache.” This is the opening line of this piece from the Wall Street Journal on how to start organizing your accounts and estate for when you pass away. In an industry based around preparing for the future, this is an essential read.

How Many Credit Cards Is Too Many?

Advice on building your credit often focuses on timely payments and account balances, but this primer from Money helps you determine how many cards you should be holding by first asking questions like “How good am I with my current credit cards?” and “What perks am I looking for?” From there, the piece helps you determine just how many cards you should be carrying to optimize your credit score.

7 Must-Listen Retirement Podcasts That Aren’t About Money

This handy Kiplinger list provides listening recommendations for the 20% of U.S. podcast listeners over the age of 55. Not all of retired life is about money, and these podcasts are great ways to spend your free time in retirement.

Survivors and Thrivers: 25 Small Business Standouts

Forbes debuted a great profile this week of businesses they call “Survivors and Thrivers,” or 25 small companies which have been navigating the challenges of 2020 in unique and powerful ways. These entrepreneurs represent the hope that comes from owning a business and shows that strength comes from the ability to adapt to change.

Check out our other Financial Friday Round-Up posts for more great reads!

Financial Friday Round-Up: September 28 - October 2, 2020
Financial Friday Round-Up: September 21 - September 25, 2020
Financial Friday Round-Up: September 14 - September 18, 2020

Financial Friday Round-Up: September 28 – October 2

Every week, our Financial Friday Round-Up compiles the best things to read, watch, or listen to regarding finance on the web. The articles below include a report on those who have started businesses during the pandemic, a guide to beating zoom fatigue, the best cities for baby boomers to live, and more.

Is It Insane to Start a Business During Coronavirus? Millions of Americans Don’t Think So.

Plenty of entrepreneurs are showing incredible courage in the face of hard times this year. The Wall Street Journal reports that new businesses are being built at the fastest rate in more than a decade, proving that many Americans have decided to take their future into their hands. Read more on how people are making lemonades from this year’s lemons in this enlightening article.

Beat Zoom Fatigue With These 6 Tips

Forbes gives us another great guide to adjusting to modern times, this time involving tips to ensure you can still bring your best to every video call. With tiny tips like scheduling breaks, switching your screen view, and picking up the phone when the video is not needed, this piece is a good read for anyone feeling the virtual burnout.

The 10 Best Cities for Baby Boomers Who Aren't Retiring Early

The reality is that more people are delaying retirement until later in life, but just because you might still be working does not mean you should not make adjustments to your lifestyle that bring comfort as you age. This report from Business Insider gives us some of the nicest cities to live in as an aging worker who may retire soon but is not quite there yet.

A Kiplinger-Alliance for Lifetime Income Poll: Americans & Retirement Security

Kiplinger reported the results of a poll they sent to consumers about their retirement assets this week, and the numbers are worth taking a look at. Get a glimpse of what the retirement landscape looks like for Americans in this quick read.

Check out our other Financial Friday Round-Up posts for more great reads!

Financial Friday Round-Up: September 21 - September 25, 2020
Financial Friday Round-Up: September 14 - September 18, 2020
Financial Friday Round-Up: September 7 - September 11, 2020

Financial Friday Round-Up: September 21 – September 25, 2020

To celebrate National Small Business Week, this issue of Financial Friday Round-Up gathers resources and articles from around the web to help small businesses and their owners. Below, we have links to the National Small Business Week homepage, a few pages of resources and statistics, tips on getting a small business loan, and more.

National Small Business Week Homepage

The U.S. Small Business Administration has been celebrating National Small Business Week for 57 years, using its platform to “recognize the critical contributions of American entrepreneurs and small business owners.” This year presents more challenges than ever, and the S.B.A. offers essential highlights from their events in years past for small business owners to use to their advantage — along with many other resources as well.

Small Business Resources: Business Information for Small Business Owners

Small Business Trends is a publication that has been dedicated to small businesses since 2003, and the library of resources they have compiled is extensive, to say the least. With everything from ebooks to templates to quizzes to checklists, this page is essential for any entrepreneur who is looking to learn.

National Small Business Week 2020 at the SBDC

The Small Business Development Center is the information branch of the U.S. Small Business Administration, and they host this page to provide resources like important statistics on America’s small businesses, COVID-19 resources for entrepreneurs, and more small business topics and help that you may need.

What Small Business Owners Should Know About Getting a Loan

This week, Forbes wrote up a guide for anyone looking for a small business loan — including what to expect when you apply and the strategies you can use to get approved. About 80% of these loans get rejected, so read this piece to stay well-prepared and give yourself a leg up with lenders.

7 Things Every Entrepreneur Should Automate

Another Forbes guide this week covers everything entrepreneurs can automate to save themselves some valuable time. From mailing lists to email responses to automated payments, this piece is bound to leave you with new techniques to make your business run smoothly.

Check out our other Financial Friday Round-Up posts for more great reads!

Financial Friday Round-Up: September 14 - September 18, 2020
Financial Friday Round-Up: September 7 - September 11, 2020
Financial Friday Round-Up: August 31 - September 4, 2020