To Sell or Not to Sell...Employer Retirement Plans: The Financial Advisor's Roadmap to a Successful Retirement Plans Practice

209 Pages·2007·2.87 MB·English

by  Tom Foster

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This book is for informational purposes only. It does not provide business or legal advice, and
should not be relied on as such. Neither the authors nor the publisher guarantees or warrants that
the information in this book is accurate, complete, up to date, or will produce certain financial
results. This information is general in nature and may not apply to particular factual or legal cir-
cumstances. Laws and procedures change from state to state and county to county and are subject
to differing interpretations. This book is not intended to substitute for legal advice obtained from
competent, independent legal counsel in the relevant jurisdiction. If you want legal advice, please
consult a lawyer. This book is not intended to create—and your use of this book does not consti-
tute—a business or lawyer-client relationship between you and the authors or publisher of this
book. This book is not a substitute for sound business and legal judgment, and you should not act
upon any of the information in this book without first confirming that the suggestions, processes,
documents, and information in this book are appropriate for your situation. All real-life stories are
to the best of the authors’ recollections, and proper names have all been changed to protect the
people involved.
President, Kaplan Publishing: Roy Lipner
Vice President and Publisher: Maureen McMahon
Acquisitions Editor: Victoria Smith
Director of Production: Daniel Frey
Production Editor: Karen Goodfriend
Typesetter: the dotted i
Views expressed by Tom Foster and Todd Thompson are their own and do not necessarily represent
the views of The Hartford Financial Services Group, Inc., its affiliates and/or subsidiaries,
including but not limited to the issuing companies of Hartford Life Insurance Company and
Hartford Life and Annuity Insurance Company (collectively, “The Hartford”). The Hartford
makes no warranty, expressed or implied, and assumes no legal liability or responsibility for the
accuracy, completeness, timeliness, or usefulness of any information in this book. Without lim-
iting the foregoing, the information in this book may not be relied upon for the purpose of
avoiding IRS penalties. As with all matters of a tax or legal nature, individuals should consult
their own tax or legal counsel for advice. The definition of retirement “plans” as referred to in
this text means various services and processes that financial professionals provide.
© 2007 by E. Thomas Foster, Jr., Esq., and Todd D. Thompson
Published by Kaplan Publishing
All rights reserved. The text of this publication, or any part thereof, may not be reproduced in
any manner whatsoever without written permission from the publisher.
Printed in the United States of America
07 08 09 10 9 8 7 6 5 4 3 2 1
Library of Congress Cataloging-in-Publication Data
Foster, E. Thomas.
To sell or not to sell-- employer retirement plans : the financial professional's road map to a
successful retirement plans practice / by E. Thomas Foster and Todd D. Thompson.
p. cm.
ISBN-13: 978-1-4195-9325-3
ISBN-10: 1-4195-9325-0
1. Pension trusts--United States. I. Thompson, Todd D. II. Title.
HD7105.45.U6F67 2007
331.25'20688--dc22
2006034503
Kaplan Publishing books are available at special quantity discounts to use for sales promotions,
employee premiums, or educational purposes. Please call our Special Sales Department to order or
for more information at 800-621-9621 ext. 4444, e-mail [email protected], or write to
Kaplan Publishing, 30 South Wacker Drive, Suite 2500, Chicago, IL 60606-7481.
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ENDORSEMENTS
“Tom and Todd provide compelling reasons for selling employer
retirement plans. Financial professionals who are already engaged
in this business should greatly benefit from Tom and Todd’s timely
insights to the opportunities created by the recent passage of the
Pension Protection Act. To Sell or Not to Sell is a must for any
financial professional who wants to get into the employer retirement
plan market because it provides specific instructions about what is
needed to be successful. Financial professionals who follow Tom and
Todd’s advice should be richly rewarded for their efforts.”
TED BENNA
President of the 401(k) Association and chief operating officer of
Malvern Benefits Corporation and a nationally recognized expert on retirement issues.
He is commonly referred to as the “father of 401(k).”
“Tom and Todd have managed to take a very complex and
sometimes scary topic—the emerging intricacies and complexities of
retirement plan legislation and plan design—and turn it into a
powerful, proactive selling and relationship management tool for
the financial professional. Through To Sell or Not to Sell, they
explain these complexities in plain English, and they make it fun!
I would recommend this book as a must-read for any financial
professional who wants to break into the retirement plans business.”
FRED REISH
Pension attorney with Reish Luftman Reicher & Cohen and a nationally known expert
on ERISA tax law and retirement plans legislation.
“Hats off to Tom Foster, Todd Thompson, and The Hartford’s
Retirement Plans Group for developing this powerful guide for
financial professionals. Solutions Based Sales is a process every
financial professional should follow—it’s simple yet powerful. It’s
no secret why these professionals have had such success in their
businesses and in their lives. I encourage you to find out what can
drive your success in retirement plan sales.”
HAL BECKER
Author of Can I Have 5 Minutes of Your Time?, Lip Service, and Get What You Want!
Nationally known speaker on sales and customer service.
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“Having shared many moments with the executives at The
Hartford, you can rest assured that this text will be filled with many
winning ideas that will help you grow professionally. To put it in
‘Vitalese,’ it’s going to be ‘Awesome, baby,’ with a capital A!”
DICK VITALE
Former basketball coach of the University of Detroit and the Detroit Pistons.
Author of Vitale: Time Out, Baby! and Campus Chaos: Why the Game I Love Is Breaking My Heart.
Currently ESPN’s number-one color analyst and in high demand as a motivational speaker.
“With To Sell or Not to Sell, Tom and Todd offer a complete
package for financial professionals: a comprehensive business case,
practical suggestions on tools and tactics, an appendix full of
reference materials, and a step-by-step approach to build a successful
retirement plans practice. They have combined their insights and
real-world experience to create a compelling call to action for
financial professionals—those who are just becoming aware of the
opportunities in retirement plan sales as well as those who have been
serving these programs for many years.”
NEVIN E. ADAMS, JD
A twenty-eight-year veteran of the retirement services industry, Adams is editor-in-chief of
PLANSPONSOR magazine. A frequent speaker at industry and trade conferences,
Adams has been quoted in multiple national publications, has appeared on CNN,
and is a regular columnist in On Wall Street magazine.
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D e d i c a t i o n
I believe everyone needs three Fs to be successful in their busi-
ness and personal lives: Family, Faith, and Friends. I’m often away
from home weekends, nights, and whole weeks at a time. I
wouldn’t be able to do my job without the love and support of my
wife Karen and my daughter Courtney. Thank you from the bot-
tom of my heart for standing by me all these years. I love you both.
I would also like to thank my beloved parents Mary and Dr.
Edwin T. Foster, my little sister Mary Jo, and my mother-in-law and
father-in-law, Pauline and Arthur Jodoin. I dedicate this book to all
of you. And I’d like to include another family member: my loyal,
trusted little buddy for 16 years, Magnolia.
I also dedicate this book to everyone whose lives have touched
me over my 32-year career—within and outside of the financial
services industry. You allowed me to be me, and you all are my in-
spiration. One special person stands out: my uncle, Larry Sullivan,
a true inspiration, who introduced me to the pension business.
Thank you all.
—Tom Foster
I dedicate this book to my wife Nicole and my children, Aaron
and Ashley. I know you often shook your heads at my early-morning
and late-evening hours. Thank you for your gift of time so this
project could reach completion.
I also dedicate this book to my mother and father, Dale and
Norma Thompson, my grandparents, Bernie and Evelyn Thomp-
son, my sister Michelle and her husband Mike Costello, The
Greatos, my uncles (Bruce, Terry, and Bernie), my Aunt Linda, my
ski buds (Rocket, Skippy, Bill, Doc, TA, and Bad Brad), and all my
other friends and family, many of whom encouraged me to pursue
the dream of sharing the information in this book and who have
made me a better person.
—Todd Thompson
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C o n t e n t s
Acknowledgments xi
Introduction: The Time is Right—Don’t Shy Away from This
Opportunity to Grow Your Business xiii
Secret 1: Build Relationships, Trust, and Confidence xiv
Secret 2: Top Producers Share Common Characteristics xvi
Secret 3: Top Producers Understand How to Close;
They Ask for the Business xvii
PART A
WHY THERE HAS NEVER BEEN A BETTER TIME
TO BE IN THIS BUSINESS
1. A Growing (and Evolving) Market 3
The Evolving Regulatory Landscape of ERISA 4
Complexity and Confusion Lead to Opportunity 8
Proof of a Rapidly Growing Market 8
What Explains This Explosive Growth? 10
Making the Most of This Growth Opportunity 12
2. Retirement Plan Sales—What’s in It for You? 15
What This Can Mean for Your Practice 17
3. No More Excuses! 27
PART B
SOLUTIONS BASED SELLING: THE ROAD
TO A SUCCESSFUL PRACTICE
4. What Is Solutions Based Selling? 35
The 80/20 Rule Applies to Sales 35
It’s All About Solving Problems, Not Selling Product 36
Gather Information at the Start 39
Find the Hidden Gems 41
vii
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viii Contents
5. It’s All about Relationships 45
How to Create a Foundation of Trust 48
Building Loyalty by Helping Employers Address Fiduciary Concerns 51
PART C
THE LIFE CYCLE OF RETIREMENT PLAN SALES:
DO’S, DON’TS, AND LESSONS LEARNED
6. Profiling Your Target Market 59
Define Your Target Market 60
Where Is Your Target Market Located? 61
What Are Your Prospective Clients’ Problems? 62
7. Building Your Team 65
Select a Service Provider That Suits Your Needs 66
Be Your Own Team Leader 70
8. Prospecting for Clients 73
Practice Makes Perfect 74
The Five Most Common Prospecting Mistakes 78
Try This Cold Calling Approach 83
What to Ask in Your Initial Interview with the Decision Maker 83
Using the Employer 401(k) Fact Finder 86
Three Characteristics of a Good Prospect 87
9. Getting Ready for Your Finals Presentation—Serious Preparation
Will Carry the Day 91
How to Use the Opportunity Diagnostic Worksheet 92
Prepare Your Pitch—Then Rehearse, Rehearse, Rehearse 97
10. Tactics and Strategies for Presenting Well and Closing the
Sale 99
Presentation Tactics: Set the Stage for Success 100
What Makes You Different from Your Competitors? 102
Strategy 1: Bring in Your Team of Experts 104
Strategy 2: Present Solutions to Show How They Meet Clients’ Needs 106
Strategy 3: Ask for the Business 108
11. Stick Around! The Art of Follow-up 113
Ongoing Education Builds Trust 114
Follow-Up Guidelines Uncover Hidden Opportunities 115
12. Final Suggestions to Get You Started 121
Step 1: Build Your Team of Experts 122
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Contents ix
Step 2: Mine Your List of Current Clients 125
Step 3: Use Data-Mining Services to Generate Qualified Lists 126
The Sky’s the Limit . . . 127
PART D
WALK A MILE IN FRANK’S SHOES
13. Fictional Case Study That Reveals Steps to Prospect, Overcome
Objections, and Win Sales 131
Step 1: Rick Convinces Frank He Needs to Sell Retirement Plans 132
Step 2: Frank Goes Prospecting 140
Step 3: Frank Meets with Two Prospective Clients 142
Step 4: Frank and Rick Present Solutions in Two Finals Presentations 149
Step 5: Following Up after the Sale 161
Appendix 1: Glossary of Retirement Products 163
Appendix 2: Model Investment Policy Statement 167
Appendix 3: ERISA Compliance Checklist 177
Appendix 4: Setting Up a Due Diligence File 179
Appendix 5: Opportunity Diagnostic Worksheet 181
About the Authors 184
Index 185