Want to sell more variable annuities, keep clients happy and avoid problems with regulators? It is easier than one might think.
Following is a 10-point system that’s great for presenting VAs (and also for working with any investment). The goal is to get a clear picture of what the client really wants to do with his or her money, offer some choices, let the client make the choice and then do what every attorney loves to see advisors do: document, document, document!
1. Get into the head of the investor. I am not the marketing genius and neither are you. The only marketing genius is the client. The advisor’s job is to find out what the client wants and then give it to the client.
To do this, try using a checklist of about 15 questions. Table 1 shows a few key sample questions. Make this list into a quick, one-page document you can use in conjunction with other sales literature. And be sure it goes through compliance department approval before using it with a client. Next, when going through the list with a client, be sure to jot down all the client’s answers.
It is important to tell clients there are no right or wrong answers to the questions. You are just trying to understand what the client would most like to accomplish with these funds so you can make some good recommendations to consider.
Take this worksheet and initial it and date it. Ask the client to initial and date it, too. Give the client a copy and place a copy in your files.
2. Score the benefits. The checklist helps identify what clients really want. Now, take out a yellow pad and create a chart that lists the benefits that appeal to the client along the left column and then write down possible investment choices across the top. Turn the yellow pad around and have the client take notes and make the appropriate marks in the boxes as you go through and explain the options. In each box, have the client enter 1 point for a “yes” and a half-point for a “depends” or “maybe.”
The completed chart might look something like that in Table 2.
Once the client totals up the columns, you might say: “So it looks like the benefits of a VA come closest to fitting your needs. Would you agree?”
Have no prejudice here. If mutual funds, CDs or municipal bonds come up with a higher score–no problem–that is what you should recommend.
Once again, both of you should initial the yellow pad. Then, give the client a copy and keep another one for your own file.