Nov 01 2022
By Mike Beirne
Vera provides clients with the right protection and financial planning according to where they are in their stage of life.
But those needs will change as they age. She shares her method for determining the right coverages and financial plan for every stage of the client’s life.
How do you divide your client’s stages of life?
Looking at the financial stages in human life from ages 0 to 80, there are unproductive stages where there is no income. The age range from 0 to 20 is when people play and learn, and the ages between 61 and 80 is when it is time to retire. There also are the productive stages when people make money, namely between 21 and 40, often referred to as the quarter-life crisis, and between 41 and 60, which is referred to as the financially mature age.
How do you create financial plans for clients at every stage of their lives?
Between the ages of 21 to 40, clients usually have started their first job or business, bought their first car, bought their first house, married, moved to the next job, had children and begun to take on the responsibility of giving monthly to their parents. So apart from health insurance, clients must also have critical illness sum insured and basic death sum insured policies, each with a minimum benefit of 60 times their monthly income. I usually call this proposal a lifestyle guarantee, with the aim that the family’s lifestyle does not decline should a risk of life occur.
For the 40 to 60 age range, a suitable proposal is an eternal fund, assuming the client has a stable financial condition. Maximize the critical illness sum insured and the basic sum insured, each of which can appreciate in value if deposited in an investment instrument, such as an interest-bearing time deposit. The monthly return is the same as the insured’s income, which can be used to support the family, while the principal is still safe in the bank as an endowment fund.
How do you convince prospects to plan their future carefully?
Becoming wealthy is not just about knowing how to make money but understanding how to manage money. There is a wise saying, “Failing to plan means planning to fail.” Product selling is no longer relevant for advisors. We must switch to concept selling. This approach means that our job is not to offer the sum assured, or fixed amount of coverage paid, but to explain what billions of life insurance sum insured can do
for the lives of the clients’ families.