Month: July 2023

Register by July 31st for the ESI Business Development Conference!

July 25, 2023

ESI Business Development Conference
August 27-29, 2023
Register Now
Learn More

Have you or a member of your team registered for the ESI Business Development Conference? In addition to training, sales, and practice management opportunities, you’ll hear from world class speakers including Ryan Haezebrouck.

Ryan Haezebrouck- Vice President, BlackRock’s Retirement Insurance Group
Sponsored by Brighthouse

Ryan Haezebrouck, Vice President, is a member of BlackRock’s Retirement Insurance Group within BlackRock’s Retirement business. Ryan is responsible for maintaining relationships with insurance firms and supporting variable annuity wholesalers and financial professionals across the Mid-Atlantic & Michigan. He is a regular speaker at industry conferences, national sales meetings, retirement income symposiums, and end-client seminars.

Ryan will be presenting “When your clients’ Health and Wealth Collide” at the ESI Business Development Conference. The global pandemic has spotlighted how devastating health can be to wealth, both on economic and personal levels, and how unprepared many clients are to face a serious health issue. Learn best practices for incorporating key longevity planning conversations into your practice to help retain client assets and connect authentically with the next generation.

Questions about the ESI Business Development Conference? Please contact ESIBusinessDevelopment@NationalLife.com.

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Maple Capital Fixed Income Commentary – July 2023

July 25, 2023

Vim and Vigor

Bond yields rose in June as economic data continued to demonstrate more vigor than expected, particularly the 3rd revision of first quarter GDP.  Combined with only sluggish declines in most inflation measures, this data provided the rationale for Fed Chair Powell to reiterate that more rate hikes will likely be needed to bring inflation into line.  Finally, it seems the bond market is listening and now pricing in a greater likelihood of such a development.  All of this led to a bit of a mixed bag: declines on most taxable bond indices — the total return for the Bloomberg U.S. Intermediate Aggregate Index was -0.60% — but a modest gain of 1.00% for the Bloomberg Municipal Index.

Read the full article here.

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Hearsay Social Media: Relative Content Campaigns

July 25, 2023

Hearsay Social not only provides the ability to publish and schedule pre-approved content from your Content library, but also the ability to automate this process.

Admins at Equity Services Inc. have created Relative Content Campaigns that you can subscribe to your social accounts. This will allow content to publish to your profile and pages, automatically and with predetermined dates and times, structured by the marketing team at ESI.

Relative Content Campaigns provide a set amount of evergreen content that can be shared at any time of the year, such as “Tax Impact on Your Retirement Strategy” or “Beneficiary Campaign”.

If you are new to Campaigns or need a refresher, please review these instructions:

To Subscribe:
1. Log into Hearsay and click Campaigns in the left navigation bar.
2. To review the content of the campaign, click See All Posts. This will display content scheduled in the campaign. You can also click See Previous Posts to review all past content scheduled as well.
3. When ready to subscribe, click your social network icons to select which of your accounts will receive content.
4. Click Subscribe to Campaign. Content within the campaign will be scheduled on your behalf.

Below is a screenshot for reference. If you have questions, please reach out to the Hearsay Help Center or contact the ESI Business Development team at ESIBusinessDevelopment@NationalLife.com.

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There’s still time to register for the ESI Business Development Conference!

July 18, 2023

ESI Business Development Conference
August 27-29, 2023

Register Now
Learn More

Have you registered for the ESI Business Development Conference yet? In addition to training, sales, and practice management opportunities, you’ll hear from world class speakers, like Mitch Anthony and Ryan Haezebrouck.

Mitch Anthony
Mitch Anthony is the founder and president of Advisor Insights Inc., The Financial Life Planning Institute, ROL Advisor, and Life-Centered Planners (U.K.), and is recognized around the globe for his pioneering work in life-centered planning.

Mitch is a sought-after expert for the media and a regular columnist for Financial Advisor magazine. His columns have appeared on CBS MarketWatch and in the Journal of Financial Planning. Mitch is also host of the daily radio feature, “The Daily Dose,” heard on over 100 radio stations nationwide.

Mitch is the author of many groundbreaking books for advisors and consumers, including perennial bestseller StorySelling for Financial Advisors, cited by Financial Advisor magazine as the number one “must-read” book for financial professionals. In addition to The New Retirementality (now in its 5th edition) and Your Clients for Life, Mitch is the author of many groundbreaking books for advisors and consumers, including Defining Conversations, The Financial Professional’s StoryBook, Your Client’s Story (now in its 2nd edition), Selling with Emotional Intelligence, The Financial Lit-Kit (The Cash in the Hat, The Bean is not Green, and Where did the Money Go?), and Life-Centered Financial Planning.

Mitch Anthony will be presenting “Becoming a Better Biographer of Your Clients” at the ESI Business Development Conference.

Ryan Haezebrouck
Sponsored by Brighthouse

Ryan Haezebrouck, Vice President, is a member of BlackRock’s Retirement Insurance Group within BlackRock’s Retirement business. Ryan is responsible for maintaining relationships with insurance firms and supporting variable annuity wholesalers and financial professionals across the Mid-Atlantic & Michigan. He is a regular speaker at industry conferences, national sales meetings, retirement income symposiums, and end-client seminars.

Ryan will be presenting “When your clients’ Health and Wealth Collide” at the ESI Business Development Conference. The global pandemic has spotlighted how devastating health can be to wealth, both on economic and personal levels, and how unprepared many clients are to face a serious health issue. Learn best practices for incorporating key longevity planning conversations into your practice to help retain client assets and connect authentically with the next generation.

Questions about the ESI Business Development Conference? Please contact ESIBusinessDevelopment@NationalLife.com .

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Important Information Regarding Envestnet Changes to PMC ActivePassive Portfolio

July 18, 2023

The ActivePassive portfolios have traditionally been appealing because they bring two distinct investment approaches – as well as their potential benefits – together in one portfolio. Since the portfolios’ inception over a decade ago, Envestnet|PMC has studied and researched the results of the ActivePassive investing approach, making adjustments as new information and data trends are gathered. 

Part of that research includes considerations around ensuring that clients receive cost-effective solutions. This conversion both addresses those concerns and is in support of PMC’s long-term research.

The conversion will provide the following benefits:

  • Cost Efficiency for Clients: ETFs generally have lower expense ratios than mutual funds.
  • Liquidity and Flexibility:  Unlike mutual funds, ETFs are purchased or sold during the trading day when the markets are open. ETF shares are priced continuously during normal exchange hours and share prices will vary throughout the day.
  • ETFs are generally more Tax Efficient than mutual funds.

Impact of Conversion

  • This conversion will have an impact on the client, the advisor, and the Firm.  We expect the change will be felt by owners of legacy accounts opened prior to 2/15/21. There will be no pricing changes to accounts subject to the asset-based pricing model, i.e., accounts established after 2/15/21 with the prefix MAN.
  • The average ActivePassive platform fee is increasing from 16 bps to 19 bps. This increase is because the current program utilizes No-Transaction-Fee Funds (“NTF”), and the program was originally priced to reflect that there were no trading costs. The switch to using ETFs going forward will result in transaction fees for all portfolio and client activity.

    The increase to 19 bps for the average platform fee will partially cover the projected costs of transactions going forward. ESI will absorb the remaining portion of transactional costs in order to keep the program pricing competitive and to mitigate the impact to advisors.
  • Capital gains/losses will be incurred and will likely generate tax consequences in taxable accounts. To help offset the impact, ESI is working with Envestnet | PMC to spread the conversion over a two-year period for clients who have concerns about experiencing significant tax consequences in one calendar year.  ESI will provide further communication and details to advisors with impacted clients in the coming weeks.  
  • Under the new pricing structure, the Envestnet | PMC ActivePassive program qualifies as a wrap fee program, as clients will not pay separately for trading costs. Accordingly, clients in this program will receive a copy of the Firm’s Form ADV Part 2A-Appendix 1 (ESI Illuminations) brochure in conjunction with the client announcement.  The brochure will provide clients with a description of the services, fees, and disclosures associated with the Active/Passive program in its new state.  The conversion does not require a new advisory agreement.

Timing of Conversion
ESI is partnering with NFS and Envestnet | PMC regarding the timing of the conversion, which is expected to take place at the end of the 3rd quarter/beginning of the 4th quarter 2023.

The conversion will be affected when Envestnet | PMC sells the mutual fund positions in clients’ portfolios and purchases ETFs appropriate to each client’s chosen model.  As noted above, clients with significant capital gain/loss implications will be given the opportunity to spread this conversion over two tax years.

Resources

Questions?
Please contact:

Mike Chiarella MChiarella@nationallife.com 802-229-3936
Tom Longfellow TLongfellow@nationallife.com 802-229-7424
Dan Randall drandall@nationallife.com 802-229-7166

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Guidance Regarding Artificial Intelligence

July 18, 2023

With great power comes great responsibility. It’s essential to understand the nature of and risks associated with the use of AI and ensure we’re safeguarding the information clients entrust to us.

Client Confidentiality: Never input sensitive client information into an AI tool, including names, addresses, social security numbers, account numbers, and any personally identifiable information (PII).  Sharing this information with AI is the same as sharing it with multiple third parties. Even if you are assured the tool won’t learn from your data, these technologies are evolving quickly.  Invariably, mistakes will be made along the way that could result in a data breach that will require client notification.

Company Information: You and your employees must refrain from sharing confidential information about your business, ESI, or National Life Group with artificial intelligence tools. These tools are designed to assist with general queries and provide information based on publicly available data. Because nothing shared with AI is confidential, sharing proprietary information, trade secrets, or sensitive data in an uncontrolled environment like AI chat tools can lead to unauthorized access, data breaches, and potential harm to the Company. It is crucial for employees to prioritize the protection of company information by not inputting sensitive data into open AI tools, such as ChatGPT.

Limitations: Recognize the limitations of AI tools. They do not replace human judgment nor be used for critical decisions.  Instead, they can enhance your services and improve efficiency. Think about AI as a guide, as opposed to an autopilot.

Training and Supervision: Train all staff members who will use the AI tool.  Training should cover effective use of the tool, maintaining client confidentiality, and compliance with relevant regulations.  Regular supervision ensures these standards are met.

Examples of proper AI use include writing generic marketing copy, mapping out schedules for social media postings, getting ideas for client appreciation events, and creating meeting agendas.

Improper use of open access AI technology includes, but is not limited to: feeding it client information to determine your ideal client, acting blindly on securities suggestions, inputting a client’s financial plan and asking for changes, and scanning a prospect’s statement for analysis.

AI is a rapidly evolving technology.  At this point in the product’s development, every possible use of the technology cannot be foreseen.  For that reason, please remember several different requirements of ESI, including:

  • Section 2.1 of ESI’s Written Supervisory Procedures – requires Registered Representatives to conduct the Firm’s business with high standards, and to always be fair and honest while dealing with customers.
  • Section 2.16 of ESI’s Written Supervisory Procedures – requires Registered Representatives to submit all advertising to the Advertising Guidance Team for approval prior to use.
  • Section 5.2.16 of ESI’s Written Supervisory Procedures – prohibits the distribution of research reports.
  • Section 5.4 (and its various subsections) of ESI’s Written Supervisory Procedures – describes the Firm’s requirements dealing with correspondence, including:
    • Section 5.4.5 – requires review by the Advertising Guidance Team before using sales materials prepared by third parties.
    • Section 5.7 of ESI’s Written Supervisory Procedures – prohibits the use of investment analysis tools which have not been reviewed and approved of by the Firm.
    • Section 5.9.3 of ESI’s Written Supervisory Procedures – prohibits the sharing of nonpublic financial information with unapproved third parties.
  • Sections 11.5 (Suitability) and Section 25 (Regulation Best Interest), and their various subsections, of ESI’s Written Supervisory Procedures – which address suitability standards and Reg BI requirements, respectively.

Under any circumstance, you must adhere to existing Firm guidelines for data security, preapproval for marketing content, and email communication. Even if AI generates the content, you are still responsible for its generation and use.

ESI will continue to monitor the development of AI systems and, depending on how the uses for the tool evolve, additional guidance may be forthcoming.

Questions
If you have any questions about this requirement, please contact the ESI Business Architecture team at 800-344-7437.

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The New App Threads Is Not Currently Approved For Use

July 12, 2023

Threads, the new app built by Instagram for sharing text updates and joining public conversations, is not currently approved for use. We will provide more information as it becomes available.

Approved social media platforms include LinkedIn, Facebook business, Instagram, YouTube, and Twitter. Please note, all profiles must be pre-approved by Ad Review before use. See the Social Media Policy for reference.

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