credit union fee income through wealth management webinar handouts

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Fee Income Through Wealth Management

C. Michael ThompsonNational Sales Director

Levi B. DayleyMarketing Director

Money Concepts International, Inc.June 9th, 2011

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It’s Getting Tougher to Run a Credit Union

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What Are Your Member’s Needs?

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What Are Your Member’s Fears?

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Psychographic Changes

Young Adult Families With Children

RetiredPre Post

HighNeed

LoansChecking

LoansInsurance

Info/AdviceInvestments

MediumNeed Investments

Info/AdviceChecking

InvestmentsInsurance

LowNeed

Info/AdviceInsurance

LoansChecking

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The Launching of an IndustryThe Sigmoid CurveThe Sigmoid Curve

Source: Financial Advisor Magazine, Thinking In 3‐D, by Monroe D. Diefendorf, Jr. 

1980 2005

2020

Birth Stage

Innovation Stage

Commoditization StageA

B

A

A

B

“The Critical Epoch”

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Advisor adoption of fee-based

pricing

Pursuing more affluent clients

Establishing deeper client relationships

Benefits of recurring revenues

Preferable way to conduct business

Source: Cerulli Associates

Forces Driving Fee-Based Pricing

Credit Unions control about 30% of the member’s wallet, usually through Mortgages & CDs.

Overexposure to CDs hurts Member & Credit Union

The RELATIONSHIP is the most valuable asset of the Credit Union

What’s the Answer for You and Your Members?

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Balance Sheet vs. Off-Balance Sheet Assets

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Holistic Wealth ManagementWhat Is The Answer For Credit Unions?

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As in the case with any professional financial planner, the wealth manager’s focus is the client. His efforts are devoted to helping clients achieve life goals through the proper management of their financial resources.

WEA

LTH

MA

NA

GEM

ENT?

Wha

t Is

Wha

t Is

The practice of the wealth manager is holistic and individually customized.

Wealth Management is a specialty of financial planning.

What is Wealth Management?

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•

Retirement Planning

•

Retirement Income Planning

•

Estate Planning

•

Wealth Transfer

•

Investment Management

•

Asset Protection

•

Senior Care

•

Tax Planning

•

Family Issues

•

Charitable ConcernsW

EALT

H M

AN

AG

EMEN

T?W

hat I

sW

hat I

sWhat is Wealth Management?

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It’s All About Helping People Three WaysIt’s All About Helping People Three Ways

TransferMoney To

Loved Ones

AccumulateMoney More

Efficiently

Produce Greater Income – Reduce Taxes

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Ages 0-20 Ages 71 +Ages 61-70Ages 51-60Ages 41-50Ages 31-40Ages 21-30

Lending Savings Insurance & 

Investments

Life Planning

Traditional Credit Union PlatformIntegrated “Member Centered” Approach

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THE TRADITIONAL INDUSTRY PARADIGM THE TRADITIONAL INDUSTRY PARADIGM Lending & Financial Services

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PARADIGM PARADIGM

THE WEALTH COACHTHE WEALTH COACH“YOUR Credit Union”

Credit Union

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PARADIGM PARADIGM

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Assumptions

1st Year Commission ‐ 6%

Trail ‐ .25%

Annual Fee – 2%

Payout 75%

$1,000 Annual Enterprise Fee

Commissions Vs Fees

What do you have to do to become the wealth

manager?

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Critical Considerations•• ProductsProducts•• Marketing SystemMarketing System•• TechnologyTechnology•• Compliance SupportCompliance Support•• TrainingTraining•• Turnkey SystemTurnkey System•• FlexibilityFlexibility•• Fee IncomeFee Income•• Management SupportManagement Support

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Non-Proprietary Product Portfolio

• Mutual Funds• Stocks • Bonds• Discount

Brokerage Services• Real Estate

Investment Trusts

• Insurance ProductsLifeDisabilityLong Term Care

• Variable Annuities• Asset Management• Hard Assets

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Marketing Support

State-Of-The Art Relationship Oriented Marketing using...

• Marketing Campaigns• Conceptual Presentation• Educational Information• State Of The Art Technology• Wealth Management Approach

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Seminar & Seminar & Workshop TopicsTopics

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Automated Solutions

•Integrated Trading Platform

•Document & Blotter Automation

•Financial Planning Software

•Compliance Tracking

•Investment Research

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Compliance• Interagency Statement on Retail

Sales of Non-deposit Investment Products - February 1994

• Gramm Leach Bliley Act• FINRA Rule 2350• Regulation R• Periodic Compliance Check-Ups• Written member Disclosure• Staff Training

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Complete Curriculum

Seminars

Symposiums

Workshops

In Person & Online

Modular Design

Ongoing Education & Training

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The Gonzalez Family

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CASE 1Gonzalez

Original Amount

Year 1 Year 2 Year 3 Year 4 Year 5 Total

Disability Income Insurance $45 / MO $540 $54 $54 $54 $54 $756

Life Insurance

$100/ MO $648 $108 $108 $108 $108 $1,080

Systematic Investment

$50 / MO $18 $18 $18 $18 $18 $72

Total$1,206 $180 $180 $180 $180 $1,908

The Gonzalez Family

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The Jones Family

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CASE 2Jones

Original Amount

Year 1 Year 2 Year 3 Year 4 Year 5 Total

Lump Sum Investment

$37,000 $592 $639 $691 $746 $805 $3,473

Life Insurance

$1,100 $660 $110 $110 $110 $110 $1,100

Systematic Investment

$300 / MO $144 $144 $144 $144 $144 $720

Total$1,396 $1,443 $945 $1,000 $1,059 $5,293

The Jones Family

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The Wells Family

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CASE 3Wells

Original Amount

Year 1 Year 2 Year 3 Year 4 Year 5 Total

Asset Management

$1,250,000 $10,000 $10,800 $11,646 $12,594 $13,605 $58,666

Life Insurance

$25,000 $16,250 $2,500 $1,250 $1,250 $1,250 $22,500

Long Term Care

$6,000 $3,300 $600 $600 $600 $600 $5,700

Total$29,550 $13,900 $13,514 $14,447 $15,455 $86,866

The Wells Family

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Holistic Wealth Management: 

Earn Fee Income for Your Credit Union  While Serving and Preparing Your 

Members Better For Life.

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Money Concepts International. Inc.

11440 N. Jog Road

Palm Beach Gardens, FL 33418

www.NAFCU.org/MoneyConcepts

Michael ThompsonNational Sales Director

Tel: (561) 472.2000 Ext: 5070

MichaelT@moneyconcepts.com

All Securities through Money Concepts Capital Corp. Member FINRA/SIPC

Money Concepts Advisory Service is a Registered Investment Advisor with the SEC

All Non Securities and Non Advisory Products through Money Concepts International, Inc.

Providers of Financial Services Since 1979

THANK YOUThank You!