The Practice Doctor is IN

Al Depman, CLU, ChFC, CMFC, BH

Practice Management Consultant

The Greatest Compliment

This month’s article is the result of a same-day collision of an e-mail signature and a conversation with a 24-year veteran advisor. 

The e-mail was from an advisor in her fifth year in response to a practice issue we were discussing. The issue was routine enough––what criteria she should use in selecting an assistant––but her signature line caught my eye: “The highest compliment you can pay me is a referral.” 

Indeed, at this point in her practice’s development that would be true. There is great satisfaction in receiving a call from a person who says, “My name is Angie and I was told by Janet that I just had to talk to you about retirement planning.” A high compliment to be sure, brightening even the darkest of days.

Other younger advisors relate similar “best compliments ever received”: 

• Edward: “At the end of an educational meeting when the client gets an ‘ah-ha!’ expression on his face and says, ‘You’re the first person who ever explained that so I actually understand it!’” I can just feel the satisfaction swelling in his chest.
• Ashley: “When the prospect I’ve been pursuing over a number of years finally agrees to meet, saying, ‘Thank you for your persistence. I’m ready to talk now.’” Ashley’s fist punching the air accompanied by a “Yes!” was a wonderful thing to behold.

In the early developmental years of an advisor’s practice, referrals, expressions of understanding and patience paying off are high compliments. The nature of the “highest compliment” evolves along with the advisor’s personal and professional maturity. 

For the seasoned advisor who primarily provides investment and wealth management, the client who is able to amass a solid nest egg and is living comfortably from it in their retirement years may provide the best compliment: “We couldn’t have this lifestyle without Joe’s money management wisdom.”

The long-standing truism in the life insurance world is that advisors really don’t know the value of what they do until they’ve delivered a death claim to the beneficiary of a client they’ve personally sold. This confluence of emotion, harsh reality, and financial necessity may well be summed up in a simple, tearful, direct eye-contact “thank you” to the advisor from the beneficiary. A powerful compliment indeed.

Andy, a veteran 24-year advisor I’ve consulted with over the years, echoes this high compliment. In the span of one year, Andy had two unique experiences in the deaths of two clients.

The Happy Ending

As is true with many advisors who have been in business for two decades, top clients often become good friends. Cindy and John had been friends and clients of Andy’s for nearly as long as he’s been in practice. In fact, Andy was a participant in their wedding.

In March of 2009, John had just purchased $650,000 of term life insurance on himself at the urging of Andy. It had been a while since the couple’s life insurance had been reviewed and their growing family had become under-insured as college expenses loomed. In August of 2009, John was diagnosed with stage 4 colon cancer––inoperable and fatal. At age 41, John received a death sentence.

He immediately began chemotherapy treatment locally. These sessions failed to slow the cancer’s spread. John found and wanted to pursue an experimental program in Mexico but would have to fund it himself. At $50,000 or more, however, it was out of their price range. Andy suggested that the life insurance accelerated benefits rider might provide the funding. 

Sure enough, the terminal nature of the cancer unlocked some of John’s tax-free life insurance proceeds while he lived. Andy and John applied for enough to cover the Mexican protocols without compromising the larger death benefit for Cindy and the children. The check arrived in days and John went forward with his plans in 2010. The Mexican treatments didn’t cure the cancer but did prolong John’s life by two months. These two months were enough to do some poignant planning.

John was able to enjoy his last Thanksgiving and Christmas at home. Andy recalls sitting on the bed with John working on a final checklist of things around the house that needed to be done, putting money aside to continue paying his son’s college tuition, and planning the funeral service, including the music and venue. Andy’s highest compliment came as they were visiting one day during the final stages and Cindy answered the phone. She was asked by the caller if she was interrupting something and Cindy replied, “I’m talking with Andy my financial advisor––thank God for him!” Or perhaps the highest compliment came when sitting with John, who turned to him and said, “I really didn’t want to talk about life insurance. Thanks for making me get that extra coverage.” Or the highest compliment could have been helping set up a scholarship fund in 2011 at the high school where John was a popular coach. 

John passed away peacefully in January of 2011. This emotional experience gave Andy the feeling of “a deep satisfaction in knowing the lives of Cindy and the children would be stable thanks to the planning we did.” 

The Not-so-Happy Ending

Marv was a favorite client of Andy’s for over 15 years. He was a successful business owner and Andy had been working with him on buy/sell agreements and key-person funding. Additionally, Andy did his personal insurance and estate planning, setting up trusts for the benefit of his wife, children from a previous marriage, and grandkids. 

Marv sold his business at age 65 and began funding his retirement with the proceeds, his savings, and Social Security. He maintained a comfortable lifestyle as an avid golfer and frequent traveler. Marv had never consulted Andy about his investments, saying, “I have somebody else taking care of that.” It turns out that he had some speculative holdings as well as real estate properties that lost most of their value in the recent recession. Andy began to notice that Marv was borrowing heavily from his life insurance cash values that had built up over the years. In March of 2011, Marv visited Andy’s office to make sure his borrowing was not going to lapse the life policies. It seemed important to him that the death benefits were as intact as possible, but Andy did not sense any panic or depression.

Two weeks after that visit, money running out, Marv committed suicide.

Andy received the call from Ann, Marv’s wife. After tearfully relating the news, she read the initial part of the suicide note to Andy: “Make sure the first thing you do is to call Andy, and he’ll take care of the finances.”

Andy reflected on this. “I can’t understand suicide. I mean he could have chosen to go back to work, sell assets, change lifestyles, borrow from friends and family. But taking one’s life? I guess for whatever logic, Marv felt this was the best outcome for his situation.”

And being named in the suicide note?

Andy paused.

“A high compliment? It did help with the aftermath, financially. The children and grandchildren were taken care of. Ann was a different story. Her policy proceeds flowed into a trust where she was not the trustee. She inherited the debt load but not the decision-making ability, which has been a real problem. So I feel complimented and honored to be a professional and fiduciary resource for her, at the top of Marv’s suicide note. But at the same time…Marv not opening up to me about his investments is very discouraging. I could have maybe helped save a life if I had known more about his whole situation.” Another pause and deep breath. “Maybe instead of my highest compliment, this could be my greatest professional frustration. The lesson, perhaps, is to be more persistent.”

Have you received a “greatest compliment” in your career? Please share them with me and I’ll share them with you in a future column. E-mail them to: al@mitchanthony.com.  Until then…

The Doctor is OUT

©Al Depman

Al Depman, CLU, ChFC, CMFC, BH, a.k.a. “The Practice Doctor”, is MitchAnthony.com’s Business Practice Consultant. He is the creator of “The Practice Management Assessment” tool and materials and has authored numerous articles in professional publications on practice management, and author of the book, How to Build Your Financial Advisory Business and Sell It at a Profit, now available from McGraw Hill. Al combined his Liberal Arts studies with 10 years of management experience with McDonald’s Corporation to enter the financial services world 25 years ago. Since then, Al has evolved from an MDRT-level sales rep into a full-time consultant specializing in helping others engineer their business practices to the next level. Contact him at al@mitchanthony.com.

© 2011 Al Depman