I was rambling around in my office recently, proofing my latest mailer and thinking about what I could do to get more high-net-worth folks out to my seminars (I do 50 per year), when I saw on the boardroom TV monitor that a diamond heist had been perpetrated at an ultra-luxury hotel in Cannes, France.
I dropped what I was doing to hear about how a famous gang, “The Pink Panthers,” overpowered the French security and vanished with approximately $125 million in high-grade diamonds. The setting, the intrigue — it was a welcome diversion, but it also sparked an idea.
After some Googling, I found TheDiamondMarket.com and started talking to Todd Lilleberg, a business development agent at the Florida-based firm. We both agreed that this asset class could increase my firm’s appeal to the HNW investor and also help bring value-added products to my current book of business.
Wait, what? I’m primarily an annuity advisor specializing in qualified income planning, so why would I want to start selling diamonds?
Well, fancy color diamonds have proven themselves to be a top-performing asset class for decades. These rare gems have generally retained their value, even in today’s volatile global economy. In fact, many fancy color diamonds have produced record results, showing remarkable appreciation at recent auctions. For example, a 0.51-carat vivid purplish pink, VS2, round cut diamond sold for $338,500, or more than four times Sotheby’s estimate, during a Feb. 2013 auction of important jewels at Sotheby’s New York.
Fundamentally, fancy color diamonds can provide high-net-worth clients with the perfect potential hedge against unstable paper currencies and depreciating assets. They also offer portability, privacy and flexibility advantages that many other asset classes can’t. Natural color diamonds encapsulate an extraordinary expression of love, a store of wealth, and a tangible symbol of one’s legacy—all in one. It is the singular thing that can draw a gasp or tears from the recipient, provide a measure of security against dubious economic policies, and remains the most permanent asset one can own or give that will fuse their legacy with lasting beauty for multiple generations.
After some educational help from Todd, I launched the venture on my long-running radio show, “Retire Right Radio.” The result was stunning to me. I saw an immediate spike in post-seminar appointments, and subsequent seminars have borne fruit via increased numbers and higher net worth individuals in attendance. I engage my audience with a family style discussion that revolves around love, lifestyle, and legacy planning because everybody is looking for secure ways to preserve their wealth and provide a lasting legacy for their family. Long after paper assets have disappeared, the inheritance of a natural color diamond will remain.
But while talking about diamond investments on the radio and at my seminars is great, the real belief system lock-in for the advisor occurs when you take a client through his or her first design-build of an heirloom diamond acquisition.