We look forward to the Van Mueller newsletter every month. It's chock-full of sound bites, sales tips, and eye-opening statistics. Here are our favorite parts of the June 2023 edition. We're sharing the full introduction, and 2 of the 7 monthly sales ideas. If you like what you read, we encourage you to click here and become a subscriber.
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June 2023 – 7 Ideas and Views Newsletter by Van Mueller
Please do not just quickly scan this month’s newsletter! Please carefully READ this month’s newsletter several times.
June 22, 2023, I turn 72 years old. I will have been an insurance and financial professional for 50 years and 5 months. It has taken me until now to arrive at the three most important issues we will face as Americans and yes, even as global citizens.
I have prepared and written this newsletter for almost 17 years. That is around 200 newsletters over that 17-year period of time.
During those 50 years, I have trained under, worked with and idolized some of the greatest insurance and financial professionals who’ve ever lived.
From the past are names like Ben Feldman and his son Marv Feldman, John Savage, Tom Wolfe, Woody Woodson, Millard Grauer, Buddy Zais, Jack Peckinpaugh, Michael Keenen, Sid Friedman, Brian Ash, Dick Koob, Peter Browne, Scotty Brennan, Randy Kilgore and so many others. If I were you, I would investigate these names. They actually laid the very foundation upon which our industry currently stands upon. These were only a few of my teachers. I learned from each of them, in general, how to be proud of my profession and they set for me an example of what a professional should look like.
Specifically, I took from each of them the one or two things that sounded like me or strengthened how I felt about particular aspects of our industry. These lessons, these bits of information helped me to build my authentic self. Our customers truly connect with and make buying decisions based on our authentic selves.
Our customers truly connect with and make buying decisions based on our authentic selves.
Whether our analytical selves believe it or not, there is no way to quantify who has the best policy or best interest rate or lowest premium or best returns. There are so many variables and even those variables are manipulated at the whim of the government, Wall Street and the banks.
If you really consider everything, wouldn’t the goal, then become building the best STRATEGY for our customers that allows them to not only survive challenges but even thrive because of the opportunities they present. Understanding that one idea makes being an insurance and financial professional exciting, rewarding and vital.
My training to become more authentic does not stop there. In order to continue to grow I must have current heroes to model myself after. However, I DO NOT WANT TO BECOME THEM. I WANT TO USE SOME OF THEIR IDEAS AND PHRASES TO BECOME THE BEST AND MOST AUTHENTIC VERSION OF ME.
In order to continue to grow I must have current heroes to model myself after.
The greats of today obviously include Tom Hegna, Ed Slott, David McKnight and Joe Jordan. Additionally, there are spectacular coaches like Jim Ruta, who is my coach, Sandy Shussel and Lew Nason. Even though Sandy and Lew are not my personal coaches, I still read extensive material from both of them that I transform into effective and authentic conversations.
Then we have the strategists Robert Castiglione who created “LEAP” and Don Blanton who created “Circle of Wealth” and Pamela Yellen, who created “Bank on Yourself, Boy” and Nelson Nash, who created “Infinite Banking System.” I have created conversations and presentations and strategies using many, but not all of their concepts. I remarkably have become a student and historian of our industry.
Finally, there are so many agents I aspire to be like. I desire their professionalism and their successful ability to focus onto what they do best, which allows them to be their authentic selves. Here is a short list.
Bruce Etherington
Ryan Pinney
James Silbernagel
Wayne Cotton
George Sigurdson
Tom Love
Paul Hansen
Chaz King
Tony Freeman
Brian Byars
Joe Jocavitch
These are just a few of the agents whose ideas I take hold of. There are many agents that I have helped train who are now essentially training me and improving my authentic self
Remember, if you steal one idea it is theft. If you steal a whole bunch of ideas, it’s research.
Remember, if you steal one idea it is theft. If you steal a whole bunch of ideas, it’s research.
Why am I sharing all of this with you? First, if you haven’t already, I would love for you to investigate for yourselves, some of these people and their methods, so they can help you the way they’ve helped me.
Finally, I want you to understand how much research and training and practice came into what I am about to share with you. I believe it is vitally important that we truly understand the major challenges our customers will face and why strategies using our products will make this an exciting and beneficial time for us as insurance and financial professionals.
Let’s examine some of the major challenges and then I will close with what I believe will be the most challenging issues ever faced by the American people.
Let’s get started with the issue everyone believes will be one of the most serious issues.
Isn’t it taxes? Many analysts believe taxes will have to increase dramatically, maybe even double to provide money for all the spending we do as a country. Social programs like Social Security, Medicare and Medicaid will require enormous sums of revenue in the future to provide the promised benefits. We will talk about these items a little more in the discussion of the next challenge.
Many analysts believe taxes will have to increase dramatically, maybe even double to provide money for all the spending we do as a country.
What are additional reasons for why people believe taxes will be much higher in the future? Where will we find the resources to deal with climate change and all the damage being cause by hurricanes, tornadoes, floods, extreme snowstorms and excessive cold? What about rising sea levels and drought conditions? We could talk about these issues endlessly.
Other issues that will require enormous amounts of revenue include immigration, which is no longer a border issue, but an entire country issue with these immigrants being transferred to many big cities in our country.
Aren’t social issues like crime and abortion and internet freedom going to cost more and more money?
What about government services at all levels? Aren’t federal, state, county, city and local levels going to cost more and more, and won’t they provide less and less services?
Where will we get all the money we will need to address all these and many other issues that I have not even mentioned? Let’s be clear. We will never be able to increase taxes enough to deal with all the increasing revenue requirements of these issues. According to the https://www.usdebtclock.org our current Gross Domestic Product (GDP) is $26.4 trillion. GDP is a measure of the value of all the goods and services produced by our country. Total spending by governments will be 36 percent of the GDP this year. By 2027, it will be 52 percent and by 2031, it will be 74 percent. Most Americans are now living paycheck to paycheck.
We will never be able to increase taxes enough to deal with all the increasing revenue requirements of these issues.
Here’s why I don’t believe they will be able to raise taxes above 50 percent and that there are not enough people making or having enough money to tax.
Here is the math. According to the Motley Fool, there are currently 5.3 million people who are millionaires and 770 billionaires in the United States. That is about 1.6 percent of the population and about 2 percent of the adult population. If we took ALL of their money, we barely make a dent in the unfunded liabilities just for liabilities for Social Security and Medicare. The unfunded liabilities for Social Security and Medicare are currently at $58 trillion. The current total unfunded liability for all the promises made by government is $188 trillion. By 2031 that unfunded liability increases to $326 trillion. We could increase taxes to 200 percent, and we don’t have enough revenue to meet the revenue requirements.
Here is some additional math for you to consider. According to the information provided by Social Security’s Wage Statistics, which I share with you every year, there are only 21 million Americans who make over $100,000 per year and only 230,000 who make over $1,000,000 per year. As I have shared with you before, if we taxed all these people at 100 percent, we would only collect 3.6 trillion in revenue. The annual budget of the U.S. government is 6 trillion and rising. This calculation does not include the revenue necessary to run governments at state, county, city and local levels.
Additionally, a brand-new Gallup poll discloses that 60 percent of adult Americans believe Federal Taxes are too high. This is a large increase from last year’s polling. A record 51 percent of Americans believe that their taxes are unfair. Wow!
I do not believe you will ever see the marginal tax rate increase above 50 percent which means the effective tax rate would be around 44 percent. Yes, taxes will increase. However, only a small segment of American society will feel increased tax wrath. Even those Americans will not be harmed enough by higher taxes to dramatically change their lives. Are higher taxes still a wonderful planning opportunity for almost all Americans? Of course, it is. However, in my opinion, it is not one of the major reasons for planning.
In my opinion, taxes are not one of the major reasons for planning.
What about a loss or reduction of benefits? Will premiums be higher for benefits? Will deductibles be higher? Will benefits be less? Will there be more out of pocket expense? Yes, to all of the above questions. Doesn’t it really portend a lower standard of living for everyone?
Is it important to discuss this issue? Yes! However, is it the most important issue? No, not even close.
What about volatility? Volatility can be very damaging, or it can be very beneficial. Many of our new product designs prevent or protect against downside while always providing access to upside. In fact, if you really think about it, the more volatility the better opportunity for better returns. The less volatility at these lower safe money rates and flat stock and bond markets would actually be detrimental.
Again, should a discussion or conversation be had about this issue? Yes, but again, it is not the most dangerous or debilitating issue Americans face.
Another issue that we must have a conversation with our customers about is longevity. What if our customer lives longer than their money? Again, this is an important issue to discuss. However, Social Security will provide income for your entire life. When it looks like our customers will outlive their money, we can use straight life annuities that will pay the highest return for as long as our customers live. Again, is this a serious problem? Yes. Will it be the most serious problem for most Americans going forward?
That leaves 3 more issues to worry about that I believe will be vital, with the last one the most dangerous challenge Americans and people from other countries will face. If we prepare our customers for these challenges, it will create a wonderful opportunity to maintain or even increase our customers’ standard of living.
If we prepare our customers for these challenges, it will create a wonderful opportunity to maintain or even increase our customers’ standard of living.
If our prospects and clients are not prepared, they will face a lower standard of living that will be difficult to endure.
WE MUST HAVE A CONVERSATION WITH ALL OUR CUSTOMERS ABOUT THE ISSUES PREVIOUSLY MENTIONED AND ESPECIALLY ABOUT THE ISSUES THAT I AM ABOUT TO SHARE, THAT I BELIEVE WILL BE MORE CONCERNING THAN ANYONE REALIZES.
First - Dying Too Soon!
Remember, almost 80 percent of Americans are living paycheck to paycheck. One emergency will put most Americans in financial trouble. Debt signals the need for life insurance: Shouldn’t we always remember that sentence? If you can’t afford the premiums now, how would your family or business afford all the debt and responsibilities your income covers now? Please don’t ever lose sight of the fact that the true purpose, the original purpose of life insurance was to replace the lost income of the primary wage earner or in today’s world the primary wage earners.
Debt signals the need for life insurance: Shouldn’t we always remember that sentence?
With debt increasing dramatically for individuals and businesses it is vital to not lose sight of this valuable benefit.
Second - Long Term Care
Nursing homes are diminishing in our country. Last year we lost 7000 nursing homes. We are expected to lose another 7000 nursing homes this year, leaving only 7000 nursing homes left. It is predicted that most long-term care in the future will be provided by a family member at home. Currently, in the United States, one out of every five Americans is an unpaid family caregiver.
This occurrence will destroy families. Why? Because it usually requires a wage-earning family member to quit and care for the family member needing care, for no wages. We must learn to have a conversation with our customers that inspires and encourages them to reallocate safe money accounts such as money markets, savings accounts, CD’s and short-term bond funds to cash value life insurance. Not because it is a better investment or pays a better interest rate. Share this conversation with your customers. Let’s say you have an investment in something that pays 5 percent return. It can be qualified or non-qualified. Based on the rule of 72, it would take around 14 years to double if the customer didn’t have to pay income tax.
Instead of investing, you inspire your customer to buy cash value life insurance. Let’s assume age 65.
If we assume the customer has $200,000 in the first example, it could grow to $400,000 by age 79 if there were no income taxes. If our customer bought life insurance, the initial death benefit could easily be $400,000 with a cash value of around $200,000 depending on the company. Over 14 years the cash value might grow to $300,000 and the death benefit could increase to $500,000.
Now, let’s have our customer require long term care. If the cost would be around $100,000 per year for 3 years, in the first example you would only have $100,00 left for a legacy benefit. In the second example you would have $200,000 left for a legacy with the same use of the money. Which was more beneficial to the client?
In the second example you would have $200,000 left for a legacy with the same use of the money. Which was more beneficial to the client?
Also, couldn’t that money be used to pay a family member in both circumstances to prevent the caregiver’s family from being harmed financially?
Why should this idea be considered? It is predicted that up to 85 percent of Americans will require long term care in retirement. USA Today headlined long term care given by a family member will be the next major healthcare crisis our country faces.
Third – The Stealth Tax – Inflation
If you really understand math and you really tune in to the unfunded liabilities our country and every other country on planet Earth face, you will begin to realize that increasing taxes will not even make a dent in fulfilling the promises made by the governments of the world, especially in the United States, to their people. According to https://www.usdebtclock.org by 2031 the unfunded liability for promises made to the American people will be almost $326 trillion or $908,000 for every man, woman and child in our country. Our GDP in 2031 is predicted to be $32 trillion. We would have to spend 100 percent of every output of goods and service for 10 years just to meet the unfunded liabilities. That doesn’t even include the funded liabilities. Remember, we haven’t had the recession yet. That GDP could be substantially lower 8 years from now.
Inflation is a silent killer of the finances of the American people. With ridiculously low inflation for 20 years, Social Security has lost 36 percent of its value or purchasing power since the year 2000. So, if you were getting $2,000 per month of Social Security in the year 2000 it now only buys $1,280 of goods and services or you need $2,720 to maintain what you could buy in the year 2000 with $2,000 per month.
If inflation had averaged its current 5 percent you would have reduced your purchasing power from $2,000 per month to $500 per month of purchasing power or you would need $5,000 per month to maintain the purchasing power of the $2,000 per month you started with. I won’t use a larger inflation number although I believe there will be inflation between 6 and 10 percent going forward.
With ridiculously low inflation for 20 years, Social Security has lost 36 percent of its value or purchasing power since the year 2000.
Government will use inflation to “get” rich people. Even if you eliminate taxes on $50 million dollars, if we have inflation at only 7 percent in 10 years that $50 million will now only buy $25 million of goods and services. If you are a middle class American with only $100,000 and you get off the tax rolls, at 7 percent inflation your $100,000 will only buy $50,000 of goods and services 10 years from now.
Stansberry Research shows a picture of Kevin Hart and Shaquille O’Neil with Kevin Hart representing CPI Inflation and Shaquille O’Neil representing Real Inflation. In a recent Gallup Poll, Americans listed inflation as their number one concern with over 57 percent worried about being able to maintain their standard of living. Let me be very clear.
I BELIEVE INFLATION IS THE MOST SERIOUS ECONOMIC CHALLENGE AMERICANS WILL FACE IN THE DECADES AHEAD.
Doesn’t that mean real danger for every American? The rich, the middle class and the poor will all have to do battle with inflation with different yet just as damaging outcomes for every group.
Cash Value Life Insurance is perfect for the present and future inflation challenges we will face.
In a world where discretionary money is decreasing dramatically don’t, we require one dollar that can do the work of many dollars. If that dollar could take care of your family or business if you died too soon or it could take care of you if you lived too long, wouldn’t that be amazing? What if that same dollar was self-completing if you become disabled and had waiver of premium? What if you had a critical illness or terminal illness and you could access your money for those events? What if you needed long term care, you would be covered, but if you didn’t need it, you wouldn’t be wasting one cent on the premiums? What if money was available to take advantage of investment opportunities without ever having lost any money first?
Finally, if inflation rears its ugly head, what if you could use almost all your cash value while you are alive and then have that money replenished by the death benefit so you could still provide a legacy for your family? Finally, what if you could buy those extra or leveraged dollars for 3 or 4 or 5 cents per year? Wouldn’t the use of cash value life insurance be the foundation of a successful strategy that could deal with all the aforementioned challenges using the most effective and efficient dollars you could find?
Really think about this. The only way the governments of the world can pay for the promises they have made is to devalue the money.
WE HAVE THE EXACT RIGHT ANSWER!
More on this information next month.
Idea #2: It Is Getting Expensive to Get Old
The National Council on Aging recently found that 80 percent of people over age 60 cannot afford a financial emergency.
Can you imagine what inflation will do to this statistic in the future if these 80 percent receive no guidance?
Title: 80% of Older Americans Cannot Afford a Financial Emergency
https://401kspecialistmag.com/ (401K Specialist, April 20, 2023)
https://401kspecialistmag.com/80-of-older-americans-cannot-afford-a-financial-emergency/
Idea #4: More Information Helpful in the Sale of Annuities
Annuities are and will be an integral part of financial and retirement strategies in the future. Use information to become well versed in annuities as you can.
This article tells you how to use annuities safely. You can learn about annuity laddering and ways to maximize income. Please add this to your arsenal.
Title: Everything You Ever Wanted To Know About Annuities But Were Afraid To Ask
https://www.forbes.com/ (Forbes, May 2, 2023)
https://www.forbes.com/sites/forbesfinancecouncil/2023/05/02/everything-you-ever-wanted-to-know-about-annuities-but-were-afraid-to-ask/?sh=5bd722213e15
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