Are you prospering in this recession?
By Lew Nason
Insurance Pro Shop
Contrary to what our elected officials in Washington, D.C. wanted us to believe at the end of 2010, the U.S. economy is still not improving for most middle income families. Many economists are even predicting this recession will become a depression. However, there is still a great opportunity for you to prosper in this recession (or depression), if you decide to take action right now.
Consider, today unemployment is just as bad as it was on Jan. 1, 2010. The amount of long-term unemployment has become so bad over the past year that the government developed new ways to track it. Businesses still aren’t hiring, and if they do, it’s often just a temporary position.
U.S. housing prices have now fallen further during this economic downturn than they did during the Great Depression of the 1930s. According to Zillow, U.S. housing prices have declined a whopping 26 percent since their peak in June 2006. Amazingly, this is even farther than house prices fell during the Great Depression, when U.S. housing prices fell 25.9 percent. We are now in unprecedented territory, and most analysts believe that U.S. house prices will continue to decline in 2011.
Mortgage interest rates have been moving up and mortgage delinquencies are on the rise again. U.S. mortgage lenders have tightened lending standards and "foreclosuregate" continues to plague the entire mortgage industry. Since Jan. 1, 2010, at least one million homes have been foreclosed on.
Meanwhile, in 2010, energy and food costs rose all year long.
Gasoline was $2.65 a gallon in January 2010; now it's $3.10. The Energy Information Administration (EIA) expects regular-grade motor gasoline retail prices to average $3.15 per gallon in 2011, 37 cents per gallon higher than the 2010 average, and $3.30 per gallon in 2012, with prices forecast to average about 5 cents per gallon higher in each year during the peak driving season (April–September).
Food prices are expected to rise as much as 4 percent in 2011, according to the U.S. Department of Agriculture. Meat prices will show some of the biggest gains. The USDA's monthly forecast has a 1 percent increase over the January 2011 outlook. That would cost a family of four an extra $40 on their monthly food bill. That's a substantial jump, but still below what happened in 2008, when food prices increased 5.5 percent.
We’re supposed to get some stimulus out of the payroll tax cut, but my bet is that whatever boost we get from that (and it's only for a year, anyway) will be absorbed by higher food and gas prices. People have to use more of their disposable income for the basics, thus less demand for those things which are likely to really drive us out of recession — new homes, new appliances, new autos. I know that the “experts” are lauding the recent holiday shopping season, but please note that it was clothing which led the way, while appliances and electronics were flat or down — and it took huge discounting to get people to shop, at all.
While all of this is bad news for most people, it is actually good news for those few true financial advisers who are focused on helping people to solve their financial problems, instead of just trying to make a sale.
As Tony Filippone, RFC, put it, "Let your readers know that there are agents like me who are loving this bad economy and are prospering. Don't get me wrong, I hate what it is doing to the good people that are being hurt by it. But, I love that it is giving people a wake up call and forcing them to look outside the box for safer alternatives that I can help them with. What a great time to be a good financial adviser. With all of the problems people are facing, we have the opportunity to really help people weather this storm and we can literally pick and choose who we want to serve. What a business!"
If you want to be successful today and stay successful, then decide not to participate in the recession. Stop listening to the nay sayers. Become the trusted financial adviser people want to see. Starting today, learn everything you can about marketing, sales, and personal finances for middle income families.
You have a great opportunity to prosper during this recession if you'll focus on helping middle income families to spend, save, invest, insure and plan wisely for the future, to achieve financial independence without asking them to spend any additional money or change their current lifestyle.
It starts with learning how you can attract the right prospects to you by focusing your marketing message on an immediate problem that you can solve right now, for your primary market.
Then it's conducting a thorough fact-find during the initial meeting. If you want to close the majority of your sales calls and increase the size of each case during this recession, then gathering the facts alone is not enough. You also need to ask the emotionally-based questions to uncover the prospect's attitudes, opinions and unspoken feelings. You need to uncover their emotions and motivations to get your prospects to set their personal priorities and take action today.
By helping families to survive this financial crisis, you'll soon become the most recognized, trusted, respected and sought-after financial professional in your local community.