Securities America advisor Bill Kantner had the kind of problem most advisors only dream of: 90 prospects — all of them retiring Verizon employees – were ready to move into the next next phase of life. He needed a way to support their needs, and his firm had it — a program aptly called NextPhase, an income distribution strategy that includes an income guarantee.
Zachary Parker (left), Securities America’s first vice president of annuities and insurance, got his team to quickly supply Kantner with 90 proposals. The pitches were effective. Kantner converted 60 prospects into clients, with a combined $30 million in assets.
But the home-office support for Kantner, based in Chadds Ford, Pa., didn’t end there. Securities America fielded an average of one call a day from Kantner’s office for a month, then the pace slowed to one every other day, Parker told AdvisorOne in an interview. The calls eventually stopped coming as Kantner’s team mastered the system. But Parker’s office still gets 30 to 40 calls a week from the nearly 350 other advisors enrolled in the plan.
Parker, an affable native Nebraskan who has worked at the Omaha-area firm for six years, believes in the efficacy of NextPhase and has set a goal of seeing assets rise to $1 billion by next fall — an ambitious target around double current asset levels.
The enthusiasm stems from the benefits NextPhase offers clients and advisors alike, but importantly because of the support Securities America is offering around the program.
NextPhase uses a time-segmented approach — colloquially referred to as a buckets approach — in which funds needed in the near-term are guaranteed, funds needed in the medium term are invested conservatively, while funds needed decades later are aggressively invested. Five or six asset pools are thus allocated into investments moving at different speeds, with a final pool targeted to the client’s legacy objectives.
For clients, the program mitigates the greater risk of portfolio depletion inherent in the systematic withdrawal approach. Parker cites a MetLife study that shows 43% of consumers near retirement age believe they can withdraw 10% of their portfolio a year.
That kind of unrealistic expectation is bound to unnerve clients seeing their assets dwindle and stalwart advisors who press on the brake pedal may not seem like heroes to their clients. NextPhase’s time-segmentation thus offers advisors and clients alike greater discipline up front and smoother relationship dynamics.