Keep it Simple: Teaching Social Security in Small Groups

Editor’s note: In this edition of What’s Working Now, an AdvisorRADIO feature in which Horsesmouth members tell us about recent success they have had running and growing their businesses, we hear advisor Gary Blom, who regularly offers Social Security presentations to six or seven people at a time in his office.

The following article includes edited excerpts of Gary’s comments, or you can listen to the full interview below.

When I was 40, like many of us, I wanted to do something different. I left the agricultural industry—when I tell people that it really opens their eyes and I have their attention—and became a rookie advisor at Merrill Lynch. That was back in 2000. I didn’t take over anyone’s book or anything like that. I started from scratch and by that I mean cold calls. If people could get me leads, like through a mutual fund wholesaler, I would gladly accept those. But primarily I built my book through relationships I had in town and cold calling.

I probably worked 60 hours a week for the first three to five years. It took that long to get enough traction to begin managing your book while prospecting at the same time. After about 10 years, Bank of America purchased Merrill Lynch and I left, going semi-independent with LPL. Then for the last year I’ve been with SCF Advisors out of Fresno as my broker-dealer.

I was lucky because I could build my business with cold calling, without all the regulatory requirements and Do-Not-Call lists they have now. I kept it real simple and didn’t get controversial. I always found that if people don’t know you and you’re interrupting them, they don’t want to converse. I would make my question short and simple, usually about yield, like a preferred stock or a common bond with a company they would recognize. Very simple, “Would you be interested in more, yes or no” That was pretty much it. I’d get some yeses, and that’s your database that you begin to work with.

The industry is largely built on gathering assets. That’s where the lion’s share of our income revenue comes from, especially at Merrill Lynch. When I went independent it became much easier to have more of a financial planning focus. And I’ve enjoyed that.

‘I have to get on top of Social Security’

About five years ago, we were having a dinner and Social Security/Medicare presentation hosted by a mutual fund company. A guest who was not one of our clients stood up and told a story about collecting Social Security at age 62 not knowing there was an income limit—that they withhold your benefits if you earn too much. Well, he got a letter from the Social Security Administration a year later saying he owed back the entire amount he’d received in benefits over the year. He owed it all back simply because he made more than $100,000 that year, and the earnings threshold was somewhere near $15,000 that year.

I sat there as an advisor and was embarrassed. I said to myself at that moment, “I have to get on top of this Social Security world. This happened to someone and even though he’s not my client, he’s not the only one making mistakes.” From that point on I’ve made it a point to dive in and get to know Social Security and Medicare.

The topic is primarily a door-opener for the business. We don’t derive any revenue from Social Security benefits, but it’s a door-opener and pretty much everyone needs Social Security, so the pool of potential clients is big.

I became aware of Horsesmouth’s Savvy Social Security&v=wmyelh5qux5rp2uxt12uhfsf and always appreciated the service because it speaks directly to the advisor in language that we use. It doesn’t talk above us, but at us. It’s been hugely helpful to a guy like myself. It’s an easy fit and it’s been a huge resource for my learning. Also, it has the materials for growing your business so that we don’t have to reinvent the wheel. It’s very easy to label it with our name and so forth and just pick it up and run with it.

Our direct-mail strategy

I live in Modesto, California, and as a point of reference, our housing costs are about 20% of San Francisco or San José. We have a much lower cost of living, but of course wages are lower too. I’ve lived in this area pretty much all my life. I mapped out the streets and sections of town I want into eight neighborhoods, and mail postcards to four neighborhoods each month on a rotating basis. So 400 postcards total in four neighborhoods one month, then 400 postcards total in the other four neighborhoods the next, and on and on. The only filters I use are age 55–65 and a homeowner. No income requirements.

I like to mail to the same neighborhoods over and over again because it creates familiarity. I want people to see my name as the postcard sits on their bulletin board. I’m going to be associated with Social Security.

We use Vistaprint to design and mail our postcards. The key is to keep it simple and not too cluttered. We tend to want to put too much on it, but you need to resist that. Have some pictures or designs, but keep it to the same color scheme. You want people to see it and be familiar with it cycle after cycle.

Our copy says, “Do you know for sure what your Social Security benefit will be? Do you know the best time to draw your Social Security?” I focus heavily on removing the guesswork from your retirement planning. I say, “We can all retire. But can we all retire well?” That’s an emphasis of mine. I also mention the WEP and GPO on the postcard, just those acronyms and the words: no problem. I want to set myself up as someone who can deal with those scenarios, because a lot of people fall into that category. It’s about removing the proverbial fog and replacing it with the understanding that they can gain knowledge and be a better consumer because of it.

Get them to the website

My other marketing is email. I use Constant Contact and I use every “opt-in” email address that I have, including our clients. That’s been very good. I’ve even been getting clients to my workshops, which is great because you’re educating them about what you produce. And if they know you’re doing it, they benefit from it and give referrals without being asked, automatically. I’m always on the prowl to add to my email list.

In the marketing, we have a phone number to call and register for one of the presentations. There is also an email address for my assistant. But the holy grail is the website, where many of them sign up. If you can get them on your site they begin learning about you. I use Leadpages to direct them to a landing page that collects their email address and name so we can contact them and coach them into the workshop. Everything needs to be very functional and working. It’s a reflection on what you’re doing.

We are always full

I put on two presentations a month: one Wednesday lunch from 12–1 pm and one Saturday brunch from 10–11 am. Each postcard has the two dates for that month and the location of our address. On the website I always have four slots available for sign up: the two this month and the two next month, because they fill up quickly. The slots fill up quickly because I hold the presentations in my conference room, which only seats six or seven.

The idea is to have it always full, because when you tell someone you’re full, that’s a good thing. Then you say, “We have one coming up on such and such a date…. You have that option.” Or we tell them if they want to come in and talk with me directly, I’m happy to take 15 minutes and talk about their situation. If I can get them in the office, I’ll take it that way as well.

We send an email reminder before the events and if they don’t make it for whatever reason, we’re very gracious and remind them that we have events coming up in the future. So everyone who signs up gets a reminder and afterward either a “come in the future” or a “thank you for coming.”

Smaller and simpler

At our midweek lunch we offer sandwiches, chips, sodas, and cookies, keeping it real simple. On Saturdays we do fruit, muffins, and coffee, that sort of thing. I’m not a great public speaker, so the big audience-type seminars don’t work for me. But I do really well when I have a small group and I’m more of an educator versus a speaker. So that works for me.

I have a full house of six or seven attendees pretty much every month, now and then one or two less. Consistency is the key, I’ve learned. You have to keep going through the slow times, the lulls, when your heart is falling out. Battle through that.

Our office is very accessible. People can park right outside our door. We’re not a “mahogany” place where people are going to feel intimidated. It’s very comfortable and welcoming, with warm colors. I like that. I know many people are successful with big restaurant seminars, but that didn’t work for me in terms of expenses. On the other hand, if you can get them into your office, that’s a good thing in my opinion. The location may keep some away, but the ones that come have seen your place and I think that cause barriers to drop and enhances the relationship.

Seeing growth within a few months

I use the Savvy Social Security presentation, then at the end I talk a little about Blom & Howell Financial Planning, what we do and the services we offer. We have some à la carte and some full service, so when people leave, they’re either making an appointment or they know clearly how to respond going forward if they would like one. I invite them to come in for a one-on-one Social Security analysis and 30-minute consultation. I just need their Social Security statements to get accurate numbers.

It’s hard to say exactly how much business this brings me. Jim Collins calls it the “flywheel” in Good to Great. You get things moving and the more activity you have going the more your business grows, and it’s hard to put your finger on one or two things.

Your growth is a result of all the activity and the amount of people you are getting in front of. Not everyone is going to be bringing rollover paperwork after these Social Security presentations. But it’s continuing activity, which then gets other people involved and that’s where growth comes. When you’re doing something like these workshops, it provides a foundation, a platform to help do that.

I would say on average three people from each presentation come to my office for a one-on-one meeting within six months, which makes for about six meetings per month with workshop attendees. Some of that turns into a long-term advisory relationship, and some of it is just the 30-minute consultation. I charge $75 for a more detailed Social Security analysis. If I do a larger, more expanded retirement income cashflow analysis using Income Solver, I charge $300 for that.

And hopefully that may lead to a larger planning opportunity. Many times it does. If people want me to manage assets, then of course the fees are different. They walk out of here very satisfied. And that’s when the referrals come.

I spend a lot of time emphasizing that society has taught us to withdraw Social Security as early as you can get it. It’s an “I’m going to get mine while I can” mentality that lets your deferred assets stay deferred. I challenge that, saying that many times when I do this analysis, the opposite is true. When you can run the calculators and show it 20–30 years out, people are totally in.

I’ve only been doing this for the last three or four months, since we settled from our broker-dealer move, but I’m happy with the activity I’m getting. All told, the Social Security presentations cost me about $600–$800, which is something that I find easy to absorb. It’s not such a stretch that I put my budget in jeopardy.

Right now I don’t know Medicare as well, so I refer clients to a couple of people I trust who sell plans. That is a reciprocal referral relationship. I do touch on Medicare in the presentation and it’s definitely a big area. I’m not ruling it out for the future, but it’s not something I do at the moment. I would encourage other advisors to dive into that.

My advice for small groups: keep it simple

My advice for other advisors is to keep it simple. Have people get food on the way in so it’s not a distraction. And keep it light, don’t get fancy—just chips and sandwiches, that sort of thing.

Remember who you’re talking to. Advisors tend to want to get complex because we know more. But keep it simple.

The PowerPoint script is good, but the big benefits come from the Q&A at the end. Then you need to have a close so that attendees know what you do (some pricing is good) and what they need to do as the next step.

The elephant in the room for any advisor is always, “How do I get people in the room?” That’s where you run into costs putting on presentations and why so many people just drop it. They can’t keep absorbing the cost.

In my experience, when most of us start something we don’t give it a long enough time frame in which to persistently work at it. I don’t care what system you use, whatever works for you is what you should do. It needs to be something you can afford, of course, and what you’re comfortable with. Don’t let the $4 million producers and their strategies impact you if you are working on a much smaller scale. You have your gifts, and it’s important that you grow them.