Here is a quick run-down on what you will find in this bulletin: Merry Christmas…
Update News for June 2022
Here is a quick run-down on what you will find in this bulletin:
Inflation – Price Increases
Inflation – Compulife’s Analysis Software
Inflation – Income Calculator
Inflation – Retirement Calculator
6 Plus 6 For 6
40th Year Celebration Referral Opportunity
How Do You Make The Referral?
This is a SPECTACULAR Deal
Our Current Programming Plans for 2022
These topics will be dealt with in more detail throughout this bulletin.
Price increases will be around the level of inflation published by the government although we all know that the “official” inflation rate is much lower than the “actual” inflation rate. Having been through the Jimmy Carter inflation of the 70’s, and having watched how hard it was to eventually get that round of inflation under control (I don’t think the government will have the same ability to do so this time), a steady annual (but marginal) increase in prices will be better than waiting and making shock price increases.
There is a way to mitigate the impact of prices increases with your subscription. Compulife is currently offering a 40th year celebration discount of 25% if you pay your subscription for 4 years. With a 25% increase it’s the same as buying 3 years and getting the 4th year for free. Not only do you get the 25% discount you also LOCK IN the current price for 4 years. For those doing so, there will be no price increase during that 4 year time period. Once again, no matter how much inflation we have during those 4 years, your subscription cost will be unchanged during the pre-paid period.
We’ll have more news about that in the months to follow, along with specific news about the new year end prices.
Inflation is an insidious economic reality but the really nasty part is trying to understand how it affects peoples’ investments over 20 or 30 years or longer. While we understood the impact, many agents and most consumers really didn’t grasp it. We wanted a calculation system, with a simple year-by-year illustration that demonstrated to people how inflation impacted their economic future.
40 years ago those programs used to sell for $179 each, but are now included FREE with your PC subscription. They have been included free with the PC subscription for a quarter of a century, and the web versions for those with the web quotation option are a one-time setup cost of only $50 (remember – price increases).
We are pretty sure that most of our subscribers do NOT use these programs. They appear as two choices on the Red Menu:
We know these are mostly ignored because very few people call with questions about them.
The Income Calculator is based upon the easy to follow idea that if you die, what your beneficiary(s) loses is the income that you had been earning and providing as a breadwinner. If on the day you die your beneficiary continues to receive the same income as you provided while you were alive, the economic problem of your death has been solved.
There are VERY few consumers who cannot follow that simple logic.
To calculate the amount of insurance requires only 4 variables:
How much income?
How long it will be needed?
What is the inflation rate?
What is the rate of return on investments?
Once you enter those values, the software will calculate the amount of lump sum money needed for the job. MUCH MORE IMPORTANT – it will demonstrate to a consumer, using a year-by-year illustration, why they need a large lump sum of money to replace the income that they were earning and providing to their dependents.
IF you learn to use Income Calculator properly, you will pay for your annual subscription to Compulife every time you use it.
Does it sound like we are over-hyping this? Try it and see what you find out when you use it with your prospect. In fact, start with it by using it to analyze your own insurance need. You might be shocked by the numbers.
POP QUIZ: The “problem number” for most consumers buying life insurance is the big face amount for insurance. If you use the Income Calculator illustration there will only be ONE problem number on the illustration page. It’s the last number which will be a ZERO. Consumers will be shocked to realize that at some point the money runs out.
If you use this tool you will consistently sell LARGER face amounts of life insurance, do so routinely and do so easily. Many agents tell us they can’t make enough money selling term, and what they are really saying is they don’t sell large enough policies. The Income Calculator will fix that.
If your eyes just glazed over, let’s use an actual non-inflationary example.
Our employee is making $50,000 per year. They are age 35 and plan to work 30 years and retire at age 65. They will need to contribute 8% of $50,000 which is $4,000 per year and their employer will have to match that contribution with another $4,000 per year for a total of $8,000 per year. At age 65 the employee will be able to retire and receive 30 X 2% of their $50,000 income, which is $30,000 per year (based upon their life expectancy of an average of 20 years).
I have just used the Retirement Calculator to process that same scenario and produced the following illustration. In this case you will see that the $8,000 per year is actually a bit light. According to the calculator it would take $9,381.41.
NOTE: The $9,381.41 is the number produced by the calculator after inputting the other variables.
Here’s that illustration:
ALSO NOTE: The annual contribution number would shrink if the rate of return was higher. If the rate of return was 4% (still no inflation), the annual contribution would decrease from $9,381.41 to $7,269.51. Of course a lot of pension plans do not vest for 5 or 10 years, and those pensions actually benefit from short term employee turnover, where the money paid into the plan for that employee will not create a retirement income for that employee but will benefit those who worked for the company beyond the vesting period.
Therefore, based upon the Retirement Calculator you can see that the old defined benefit calculation was a solid calculation scheme if there is no inflation and about a 3 to 4 percent return on investment during the lifespan of the pension which includes the accumulation period and the pay out period.
The first lesson to be learned from this is that the idea that you can put away $100 per month and provide for your retirement is a load of crap. To get 60% of your income after 30 years of contributions, you need to invest 16% per year of your annual income.
The common reaction of most people is “but I can earn a lot more than 3% on my money”. OK, you are going to need to do that because of inflation. In fact, if you invest really wisely, you will need a certain amount of your ROI just to overcome the impact of inflation. What do I mean?
In this second illustration we are going to assume 8% inflation and an 11% rate of return. Let’s see how that changes the numbers.
The first number that we want to point out, by comparison to the no inflation illustration, is the first year deposit. This is now $9,926.86. What is surprising is that the $9,926.86 is ONLY marginally different from the $9.381.41 value we had in the no inflation example. Actually the numbers would be MUCH closer together if we were doing the calculation on a monthly and not an annual basis but the whole point of the calculator is to make it simple enough for the consumer to follow those numbers.
The second things to make note of is that because we are now dealing with 8% inflation, that initial deposit will need to be indexed each year to keep the relative value (with inflation; the present value) of the contributions the same. In an inflationary economy wages should be going up, and so you should be able to afford to make bigger and bigger deposits.
In this illustration the 8% inflation means that in the last year before retirement, our prospect needs to make a deposit into the fund of $92.491.26. That is worth, at 8% inflation, the same $9.926.86 that they deposited in the first year.
In the previous illustration (no inflation) our prospect would have at age 65 a total of $459,713.97 from which to draw a $30,000 income. With 8% inflation our prospect would now have $4,712,245 from which to draw an indexed (at 8%) income of $301,879. The present value of that income is still the $30,000 that we saw in the no inflation illustration.
In both illustrations you will see that at the end of the 20 years of taking income, the value left is ZERO. This is the very same principle as with the income calculator. You start, in this case when you retire, with a large lump sum of money and that money is paid out as an annual income for a period of time. At the end of that period all the money is gone.
Actually, your need for income in retirement is exactly the same as your beneficiary’s need for income should you die. You buy life insurance to provide an income if you die before you retire, and you save for retirement so you can stop working when you retire. In both cases a lump sump of money solves the problem of providing an income because you have stopped working.
40th Year Celebration Referral Opportunity
As background, all new prospective subscribers to Compulife start out the same way. If a prospective subscriber contacts us directly, we give them a 30 day free trial for Compulife’s PC software. If that prospective subscriber does a 10 minute tutorial, to show that they have learned to use the software, then they get 4 free months of service.
We BONUS for referrals – both the person who made the referral and the person who they referred.
If an EXISTING subscriber refers that person to Compulife for a free trial, then the prospective subscriber gets 6 free months instead of 4. That’s a nice bonus for the person you referred. For you, the person making the referral, we give you a free term4sale “home” zip code for 2 years plus the balance of the current year that we are in. That’s for you, for making that referral.
For the Next 6 months we are doubling YOUR bonus!
For the next 6 months, as part of our 40th Year Anniversary, we are going to sweeten YOUR compensation for those referrals. IF your referral does the tutorial and signs up for the 6 free month subscription (no obligation to buy at the end of 6 months), then you can get compensated with your choice of:
- 2 FREE local zip codes – for two years plus the balance of 2022
- 6 free months added to your annual subscription to Compulife *
* NOTE: This does not include 6 free months for the Compulife Batch Analyzer or the Compulife Internet Engine or bulk purchase sub-user licenses
For those of you who are active participants to Term4Sale, and always anxious to add more zip codes, this should be a NO BRAINER. 2 local zip codes can be added to your account and even IF you have maxed out on your allowed number of additional zip codes, then we allow those added HOME zip codes over and above that limit. FURTHER, local zip codes give you the option to “bump” subscribers out of your local area. While you cannot use the bump option until the week of November 7th, 2022, you still get to add those two zip codes IMMEDIATELY and choose zip codes on a first come, first served basis (which assumes the zip code does not already have 3 agents listed in it).
You can accumulate these bonuses!
If you refer 6 people, and those 6 all do the tutorial, you get 12 zip codes added to your account, and they will be considered paid to the end of 2024.
REMEMBER: For the Next 6 months we are offering an important alternative bonus.
If you don’t care about zip codes or term4sale, then those same 6 referrals who do the tutorial to get 6 free months will get you 6 X 6 months added to your subscription. Once again, if you did 6 successful referrals that would add 3 free years to your subscription.
There is no limit to the referrals.
If you refer more, and your referrals do the tutorial, you get ANOTHER 6 free months for each referral. The only limit is August 1st. If it is August 1st or later, you will have missed your opportunity.
Remember: There is NO limit.
How you don’t sit down and put in the name of EVERY fellow life insurance agent you know would be a mystery to me. I guarantee you that when this SPECIAL referral opportunity ends on July 31st, you will be kicking yourself for not having taken advantage of it.
Is there a catch?
YES there is always a catch. Your referral has to take the 30 day FREE trial email that we have sent to them, and they must DO THE TUTORIAL. If they don’t do the tutorial, then they don’t get 6 free months. If they don’t do the tutorial, and get the 6 free months, then YOU don’t get 6 free months.
You can help this process by making sure your referral knows that to get the 6 free months they have to do a tutorial. To review, there are two benefits for the prospective subscriber when they do the tutorial:
- 1. They learn how to use our software
- 2. They get the software for 6 free months
I have said many times that if someone doesn’t learn how to use the software, then they won’t use the software. If they don’t use the software, they won’t find out that it will make them money. If it doesn’t make them money, then why would they buy it?
If they do get the 6 free months, there are 4 things that come FREE for those 6 free months:
- 1. A free subscription to the PC program
- 2. A free subscription to Compulife Basic
- 3. Web quotes for their website
- 4. 3 Zip Codes At Term4sale
One more catch. The person referred cannot have had a subscription to Compulife in the last 24 months. (a subscription includes a 4 month free subscription)
And the biggest catch of all – you can’t get any of this if your don’t make a referral.
So for 10 minutes of homework, your referral gets to find out for a period of 6 months if those Compulife subscribers are telling the truth. You’re a subscriber, you already know – they don’t.
And here’s the last catch which may be fatal to the concept. Many subscriber do NOT want fellow agents finding out just how good Compulife is, because if those fellow agents know what you know, they might end up one day competing with you. OK, I get that and if that is your logic then I can see how you would want to keep the big secret all to yourself.
But for those of you who are NOT worried about other agents being better than you, I think this 40th year anniversary special is VERY SPECIAL. We have NEVER offered a deal this good to our subscribers, and if you want to hang around and wait for the 50th anniversary special, to see if there might be an even better deal, then go ahead. But depending on how hard you work at making referrals, you may be able to get to the 50th year special without having to pay for software (20 successful referrals get you there).
- Introduction of New PC Version: CQS.EXE
- Overhaul Of Current Product Data Files
- Introduction of Compulife Basic Plus (with Pick 12)
Anyone with questions about any of these upcoming projects can call Bob Barney to discuss:
Please don’t email me essay questions, just call. If I’m not in, email me your phone number, I’ll call you.
These planned objectives will easily consume our programming time during 2022. The good news is that once the product data files have been converted, and we have introduced the new CQS.EXE, and upgraded our internet engine to use the new data files, Compulife will be turning it’s full attention to our web based, Compulife Basic software. The long term goal is to have a web based product that does everything our PC based software does.