(Presentations were created using Wealthy and Wise®.)
Real wealth involves sustainable after tax cash flow coupled with maximum net worth invested at comfortable yields. Note the use of the phrase “after tax cash flow” not “after tax income”. This often means accessing principal from weaker assets while allowing stronger assets to accrue as long as possible.
Case Study Video, Good Logic vs. Bad Logic™ (8 minutes):
For the full version of this video (17 minutes), please click on the link at the end of this blog post.
Example: Simon and Ann Scott are age 55 and 50 and plan to retire in 10 years. They have almost $6.5 million in net worth (IRAs, CDs, Munis, Equities) and $900,000 in home value and personal property. They want $25,000 in monthly, after tax, retirement cash flow indexed at 3.00% as an inflation offset. It’s the first day of the first month of their retirement, and they need $25,000 for the month.
But now the pothole . . .
From which account do they take it? And does it make any difference? You bet it does. They can take it out smart (we call this Good Logic) or they can take it out using guesswork (we call this Bad Logic).
In their case, both Good Logic and Bad Logic produce the needed level of after tax cash flow over their years of joint life expectancy (40 years in this example); however, net worth is a different story.
The result is a difference in long-range net worth of $12.5 million in favor of Good Logic. If you were their adviser and didn’t help them determine this, you had better hope a competitor doesn’t.
So, how do you do this calculation for your client? Well, you could program Excel to do a factorial solve (1 x 2 x 3 x 4 = 24 solves each year for 40 years in this example). If you have, say, 10 asset classes, it would take 3,628,800 million solves each year for 40 years. You probably don’t want to have Excel do that.
If this is your initial introduction to Wealthy and Wise®, you may want to watch the Comprehensive version of our “how to” video where we take your through the sample case step by step using our Wealthy and Wise® planning system.
Comprehensive version including the Case Study (17 minutes):
Good Logic vs. Bad Logic™ Video (Comprehensive)
InsMark’s Referral Resources
(Put our Illustration Experts to Work for Your Practice)
We created Referral Resources to deliver a “do-it-for-me” illustration service in a way that makes sense for your practice. You can utilize your choice of insurance company, there is no commission split, and you don’t have to change any current relationships. They are very familiar with running InsMark software.
Please mention my name when you talk to a Referral Resource as they have promised to take special care of my readers. My only request is this: if a Referral Resource helps you get the sale, place at least that case through them; otherwise, you will be taking unfair advantage of their generous offer to InsMark licensees.
Save time and get results with any InsMark illustration. Contact:
- Ben Nevejans, President of LifePro Financial Services in San Diego, CA.
InsMark’s Digital Workbook Files
If you would like some help creating customized versions of the presentations in this Blog for your clients, watch the video below on how to download and use InsMark’s Digital Workbook Files.
Digital Workbook Files For This Blog
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For a license to use Wealthy and Wise®, go to InsMark or contact Julie Nayeri at InsMark at julien@insmark.com or 1-888-InsMark (467-6275). Institutional inquiries should be made to David A. Grant, Senior Vice President – Sales at dag@insmark.com or 925-543-0513.
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Absolutely astounding. The InsMark system is the most powerful sales and planning tool I’ve ever seen. Thank you so much for the Blog.
You are very welcome Richard. We really appreciate your comment s and support. You have our commitment that we will continue to do everything in our power to bring you the best sales ideas and most effective ways to present them.