sales opportunities within the group retirement market caifa ontario school 2001 daryl diamond cfp...
TRANSCRIPT
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Sales Opportunities Within The Group Retirement Market
CAIFA Ontario School 2001
Daryl Diamond CFP CLU CHFC
Diamond Retirement Planning Ltd.
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Disclaimer
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Two Aspects
• Our approach to prospective employers
• Making it work
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Two Tales
1 The Generous Volunteer
2 The Confident Loser
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Our Objectives
To deliver interactive programs of financial and retirement education in Canada’s workplace
To encourage employees, through these workshops, to take an active role in their own financial affairs
To accomplish the above through a national network of qualified advisors
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How These Programs Were Written
Information in a logical progression Educational and insightful With neutrality Without product or institutional bias Encourages exploration of alternatives Encourages attendees to take action
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Issues To Address
The need from the corporate perspective
The need from the employee’s perspective
Choosing a provider
Funding the program
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The Need From The Corporation’s Perspective
What are some of the reasons you would consider implementing an educational program within your organization?
What are some of the obstacles you face in providing such a program?
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The Changes To Corporate Retirement Programs
Move away from Defined Benefit (DB) pension plans to Defined Contribution (DC) plans
Move from pension to Group RRSP combined with pension and /or DPSP
Availability of new investment options, many of which are variable, and chosen by plan members
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Employee Retirement Income Security Act (ERISA)
Section 404(c)
Directs the employer to provide;
Reasonably diversified investment options Flexibility for employees to make changes
to investments throughout the year Proper information on investment options
and investing
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ERISA Clarifications
“We will encourage employers to provide pension plans and help teach workers to plan and save adequately for retirement”
U.S. Labor Secretary
Alexis M. HermanNovember 1997
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Components In Your Retirement Programs
ConsultantConsultant InvestmentManager
InvestmentManager
Plan actuaryReportsProvides quotes at,
TerminationRetirement
Manages investmentsDistributes contributionsProduces statements
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We Provide What Is Missing
Education and insight Communication An accessible resource Recommendations based on the total picture Positioning, structure and ongoing counsel The follow through to make things happen
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Benefits To The Employer
Increased productivity Increased understanding and participation
in corporate benefit programs Increased employee retention, loyalty,
morale - good will / appreciation Increased preparedness for employee
retirement
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Older Employees
Highest end of the pay scale Employer retirement contributions are high Most expensive benefit premiums Most vacation days
Providing financial education at a younger age allows for better financial decisions and puts employees in a position to retire earlier
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The Need From The Employee’s Perspective
Changing Factors
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Changing FactorsMale Age 65
Income FactorsYear Life Expectancy
7.5 Yrs
10 Yrs
14 Yrs
1975
1985
1965
Today
2010
17.5 Yrs
20 + Yrs
Only a few retirement years to fundCPP commences
Appreciating real estate valuesHigh nominal interest ratesExcessive taxationExcessive Government borrowing
None of the above apply in the same manner
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The Need From The Employee’s Perspective
Changing Factors
Considerations For Future Retirees
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Additional Considerations
Issue
Retirement Age
Life Expectancy
Lifestyle Expectations
Taxation
Inflation
Family Complications
Wealth Transfer
Forecast Impact
_______ _______
_______ _______
_______ _______
_______ _______
_______ _______
_______ _______
_______ _______
earlier
longer
better
greater
present
possible
important
more
more
more
more
more
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The Need From The Employee’s Perspective
Changing Factors
Considerations For Future Retirees
Realize they need it, they want it, but do not know where to go to get it
The Reality
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The RealityCIBC 1998
72% do not have a financial plan even though 48% use a “financial advisor”
21% have not started to save for retirement 51% have saved less than $30,000 33% have saved more than $100,000 7% have saved more than $400,000 62% expect to work to age 65out of necessity
Source: Financial Post
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The Program
A workshop that consists of seven to nine hours
An optional one on one consultation
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The Four Levels of Adult Learning
1. Awareness of an issue
2. Understanding the issue
3. Realizing the impact
4. Recognizing the steps to take
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Total Planning Includes
Looking at the whole picture Understanding, and full participation in,
company programs Implementing accumulation strategies
outside of employer programs Tailoring plans and strategies to each
situation
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Many Pieces To the Puzzle
Budgeting Accumulation and income strategies Investment strategies Education planning Tax planning Risk management Estate planning issues
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What Level Of Service ?
Ongoing Service
Implementation
Planning
EducationEducation
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Stages of Employee Election
Decision to attend workshop Decision to complete information forms Decision to meet for consultation Decision to establish relationship Decision to implement recommendations
Use of a “Waiver Form”
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Selecting A Financial Education Provider
Do not provide this service “in-house”
1- 800 numbers from investment manager
Fee based provider
Full service provider
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How Should This Program Be Financed ?
Workshop is a low-outlay, high impact benefit
Corporation provides as a benefit Cost shared with employee Deducted against expenses of plans Appoint us as “Agent of Record” on your
plans
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An Invitation ...
Allow us to provide a sample workshop, to a selected group of your people, pension committee, employee liaison group, etc.
If at least 70% do not find it a positive experience, we will refund the cost of enrollment
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Client Sources
• Existing Groups - What level of service?
• Where do your individual clients work?
• Pairing with a group producer
• Large corporations and government agencies with no servicing mandate
• Open sessions
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So What Are The Results ?
• How many come in ?
• Why is this efficient ?
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Feedback Sheets & Questionnaires
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Additional Opportunities
• Referrals from H.R.• Consolidation• Lunch and Learn• Special Events• Company Newsletter• Pay Envelope Stuffers• Company E-mail• Downsizing
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What Do You Need ?
• Educational program to offer
• Access to group situations
• Membership in CPBI, CAPP and local H.R.
organizations
• Great work ethic
• Organization and admin assistance
• Patience
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www.personalfinanceseries.com
Find out more at ...
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Any Questions ?