Many financial advisors would like to offer their clients well-designed tax-free indexed life strategies but often need a design partner who truly understands all the options. PPG’s team serves as subject matter experts, working with advisors behind the scenes to craft and design plans on behalf of their clients.
In an interview with Manage HR, the CEO of Premier Planning Group NC and architect of OPTIMUS Life Designs®, J. Bryan Setzler, talks about the company’s current position in the retirement planning space and how their insights and solutions benefit their clients and the high-net-worth individuals they service. Setzler highlights the art of strengthening client relationships by enhancing an often less-understood financial product — indexed universal life.
Helping clients secure a tax-free retirement
I’ve been in the business for 34 years. Tom Williams, my V.P. of Sales, has been in the business for about 46 years. We believe our experience combined with technology, can deliver the best solutions in the industry. We add internal leverage to optimize product performance over the long run. Leverage allows our case designers to increase the total funding going into the product, thereby producing a more robust retirement cash flow.
With our OPTIMUS Life Designs® platform, we have multiple tiers of designs based on each insured’s unique circumstances. These options help us craft the right solution that makes the most sense for each advisor’s client. Listening closely to client concerns has enabled us to deliver high levels of client satisfaction at both the advisor and insured levels for decades.
Our tax-free wealth accumulation and wealth transfer plans utilize proprietary formulas of supplemental leverage to enhance product performance, delivering the best-performing client solutions in the industry. The designs are structured to dramatically outperform taxable and tax-deferred offerings.
The client pays no income tax on any growth or future distributions from these plans. The plan death benefit will repay any outstanding loans upon the death of the client. There is no downside risk to the client’s money during bear markets. During bull markets, when the stock market is performing, the account locks in a new value each year, preserving gains. This essentially resets the amount of money their account cannot go below annually.
Since the client’s money is not invested in the stock market, the plans offer a stable, protected growth solution. The funds within each plan are safe and secure on the balance sheet of large life insurance companies. The year 2022 was tough, with the capital markets facing a challenging amount of volatility. Consumers are afraid to make confident financial decisions because they don’t want to invest more money in a market going down. Our plans allow our clients to be more comfortable investing for their retirement without worrying about losing a significant part of their savings. Our designs strike the right balance of great upside potential during good times and protection from market losses during challenging times.
Providing a retirement plan for all Business Owners
Our clients generally fall into one of three categories:
Group I: HENRYs or High Earners, Not Yet Rich. These highincome professionals are building wealth and know they need to set aside some of their income for accounts that can help them prepare for retirement. They’re not wealthy enough to retire tomorrow, but they know they need to make smart decisions with their money to prepare for their future.
Group II: Already wealthy, with money in many different accounts, including IRAs. IRA accounts are tax-deferred, which means the values have not yet been taxed. However, future distributions will become taxable at ordinary income rates. We have designed hundreds of plans based on the idea of re-capitalizing the IRA into a tax-free account, much better suited to transfer to the next generation.
Leverage allows our design team to increase the total funding going into the product, thereby producing a more robust retirement cash flow upon the client’s future retiremen
Case Study: The secret of turning $75,000 a year into $13 million of retirement savings
A 37-year-old woman came to one of our agents. Her goal is to save $75,000 a year for ten years toward her retirement. By funding a taxable account, earning an assumed 6.6% average earnings, she would be projected to receive about $1.7 million in retirement distributions. At the same assumed growth rate of 6.6%, our OPTIMUS plan is projected to deliver $13 million in tax-free benefits throughout her retirement, with over $6 million left in her account, for a total of $19 million in benefits over her lifetime.
In this example, the client had 20 to 30 years before retirement, and the OPTIMUS plan delivered over ten times the normal baseline. For older clients, we usually reach 3 to 4 times the baseline — a great improvement.
How OPTIMUS Life Designs® works
Generally, we’ll work with a client’s financial advisor and other tax professionals to fully understand their current situation and then encourage those advisors to look at our recommendations. We design a plan, communicate it, and then administer it along with any leverage that needs to be implemented. If a client wants to continue working with their current advisor but wants a second opinion on their life insurance design, we can help.
We have more than 10 members on our staff, many of whom support the administration of the over seven hundred policies that we’ve put together over the last four years. With OPTIMUS Life Designs® automated proposal generation capabilities across our multiple product solutions, we can deliver custom proposals in one day. By doing so, we can dramatically increase the standard of living that a client is expected to enjoy during their retirement with superior financial results.