Put Some “Skin in the Game”

“To be successful in business and investing, you’ve got to have skin in the game, a stake in the company.”
 ~Warren Buffett

Chances are, your clients are suspicious about whole life insurance. They’ve probably read all kinds of misconceptions online, that “whole life is a bad investment with terrible returns” or that “policy sales are driven by high commissions.”  They may have even heard these myths from family members or seen inaccurate comparisons, even from another financial professional.

We get it. Whole life is woefully misunderstood. We’ve also learned that explaining this doesn’t always ease a prospect’s mind!

When a client or prospect knows that I also own whole life, they realize I’m sharing a personal choice, not simply throwing them a sales pitch. My husband Todd and I own literally dozens of whole life policies. We have them on ourselves, each other, family members and key team members. It is a real-life demonstration that I am a believer in whole life. It is reassuring to them that I have “skin in the game.”

Economist Thomas Sowell wrote, “It is hard to imagine a more… dangerous way of making decisions than by putting those decisions in the hands of people who pay no price for being wrong,” and this certainly applies to our finances!  Invest in whatever you ask your clients to invest in. Lead by example.

When I explain the advantages of having your own life insurance policy and using it to make loans to yourself for emergencies and opportunities, I am talking from experience.  Clients will respond to the genuine success that you have seen with your own savings and investments.

If you sell alternative investments or private equity funds and are not accredited or don’t want to invest the minimum required, ask the fund manager or company rep if you can invest less. For instance, I approached one fund provider with an offer of $10k and they accepted it.

Occasionally a client might ask, “Do you have any money in these things yourself?” At that point, you can take a firm voice on the phone or look them straight in the eye and say in all honesty, “Yes. I am investing right alongside you!” Whatever you recommend, be a “product of the product” and follow your own advice. You’ll be able to see first-hand how the policy or investment works, and it will raise your confidence and your credibility.

As a financial advisor, you should be asking clients to update their will. Again, be sure to practice what you preach. Update your own will. When I was starting out, I went to an office supply store and spent 35 bucks on the forms and got my own will in place. (Now it’s not quite that simple, but yes, I keep my will current!)

I can’t overemphasize the principle of leading by example. Success is all about leadership! If you want your clients to be on time, you have to show up on time. If you recommend a book, you better have read it yourself or gone back to it multiple times. Never ask them to do something you haven’t done yourself.

It’s also important for your clients to have skin in the game. One small but helpful way can be to ask them to buy books. Don’t feel like you have to give them books (although books and ebooks can be an excellent strategy for an opt-in bonus or “lead-in magnet,” and however they get a book, it can really help the process!) But unless it’s an ebook lead magnet, I direct clients to Amazon or the appropriate website so they can purchase the book(s) they need to read before the next appointment. People don’t always value what they get for free. Also, they get to select the format they want, and it lets them take responsibility in educating themselves. (And I don’t think it hurts my positioning to send them to Amazon to buy a book I wrote, either.)

If there is any area in which your clients don’t want to follow you, look and see if you are truly leading by example, or trying to get them to do something you haven’t been willing to do yourself. When you’ve got “skin in the game,” your clients will follow your lead.

~ Kim D. H. Butler


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