Everything old is new again
If you have a long-term perspective, what goes around, comes around. Segregated funds were a hot topic among Advisors, with many offering this solution for the sleep-at-night guarantees. Markets rose, the focus shifted, but given industry cyclicality and client sentiment… here we are again.
When I ask people about their long-term investment strategy, risk tolerance and vision for wealth, 9 out of 10 – even younger clients – say they’d rest easier if their money was protected. They’d all like it to grow, of course, but they are most concerned about the prospect of losses. That’s where seg funds come in with upside potential and as a safeguard in market downturns – a recurring theme that comes up whether I’m discussing life, critical illness, disability or business insurance… and at any life stage; among working professionals, pre-retirees, or those planning to transfer their wealth.
Client education is vitally important, so I explain that there’s no single all or nothing solution. Should seg funds be a suitable option, from day one, a portion of their portfolio would be locked up nice and tight with added security, knowing that money is always going to be there regardless of the markets. However, you can’t build a clock with a single cog; it’s a portfolio complement.
What’s most interesting is that I meet many people who didn’t know that insurance investment options like seg funds were even available to them. It’s an eye opener to Baby Boomers; as soon as I discuss named beneficiaries, creditor protection, and the available maturity and death benefit guarantees they question why no one has ever told them about this before now.