Business Innovators Radio - Michael Moore CLU, Chartered Financial Consultant

Episode Date: May 11, 2023

Michael welcomes 2023 as his 26th year in the life insurance business. Michael started his career with a small brokerage agency in Tustin, CA as an application processing agent. After several years there he moved on to CPS Insurance and managed their underwriting department which was responsible for handling over ten thousand life insurance applications annually. As his experience and knowledge with insurance continued to grow, he accepted a position at First Financial Resources where he worked diligently to rebuild and maintain the company’s elite position in the financial services industry. In 2007 Michael was hired by a subsidiary of AIG (AI Credit) to help build their financed life portfolio.In 2009 that portfolio was acquired by Wintrust under First Insurance Funding. As Vice President of Sales, he was a leader in creating a loan portfolio of over $300M in financed premiums. In the summer of 2015, Michael worked for a short time with a small firm out of Phoenix before establishing his own business operating as CDP Insurance Services, Inc. CDP is a boutique firm specializing in leveraged insurance strategies.Learn more: https://www.cdpinsurance.comInfluential Entrepreneurs with Mike Saundershttps://businessinnovatorsradio.com/influential-entrepreneurs-with-mike-saunders/Source: https://businessinnovatorsradio.com/michael-moore-clu-chartered-financial-consultant

Welcome to influential entrepreneurs, bringing you interviews with elite business leaders and experts, sharing tips and strategies for elevating your business to the next level. Here's your host, Mike Saunders. Hello and welcome to this episode of influential entrepreneurs. This is Mike Saunders, the authority positioning coach. Today we have with us, Michael Moore, who's a chartered financial consultant with CDP insurance services. Michael, welcome to the program. Thanks, Mike, for having me. Hey, you're welcome.

I'm looking forward to learning from you because I know you do some really unique things in the industry, but get us started first with your story. What is your background and how did you get into the financial services industry in the first place? You know, I was a psychology major at college and sales just sales is psychology, if you really think about it. And so I kind of stumbled into this profession, knowing I wanted to do something. I think sales wise, but landing in the financial services realm and then specifically in risk and tax mitigation, it just all seemed to kind of make sense together. You know, you said a mouthful there, psychology. I teach marketing for several universities

and one of the courses is consumer behavior and buyer behavior and the buyer's journey. And it is really all about the psychology of why people make decisions. And, you know, if we understand that about our clients and prospects, no matter what the industry is. But I think that you coming with that background really serves your clients well because you're able to come to them with empathy and educate them and understand they might feel this way about a certain topic or their retirement or their wealth or, you know, reducing taxes, things like that. So that's a really neat foundation to be presenting to your clients.

Absolutely. I agree 100%. So what is the main focus in your company, CDP Insurance Services? What is it that you are typically solving for your clients? What kind of clients are you working with? We focus on high net worth clientele and help them solve a myriad of problems, mostly related to the fact that they do have this tremendous wealth. And a lot of it revolves around taxes and how to mitigate those, leaving a legacy,

you know, avoiding paying large amounts or large sums of taxes to the government. You know, when you describe that, it reminds me of the cliche bucket with holes in it. And I know that that's really popular, but a lot of people would come to, let's say, a business advisor and go, I need to make more money because I'm not, you know, enough isn't staying in my bank accounts. Well, maybe making more money is a wonderful thing. But first, I would think if you could stop up as much of those holes as possible, from expenses and fees and taxes. And we know we can't plug up all the holes because you've got to pay taxes,

but what are some of the low-hanging fruit that you start teaching your clients about with respect to mitigating those taxes? Well, first, that's one of my favorite Hank Williams senior songs about a hole in the bucket. But, you know, we talk about your CPA is technically a person that you come to and they're very reactive. You say, look, I made this much money. How do I offset my taxes? What we try and do is look forward from here and be proactive and say, well, if you do X, Y, and Z planning, we may be able to lower your taxable income.

And then we try and show those clients by using those savings to do further planning that could mitigate taxes in the future as well. You know, and I think that people would hear that and go, oh, yeah, but I don't have, you know, they have certain assumptions. Like, oh, well, I can't do it because. But you work with a lot of small business owners. What are some of the things that small business owners typically might think, oh, that might not work for me. But then when you say, take a look at this and consider that, what are some of those aha moments that you are presenting to your business owner clients? Absolutely. They look at everything as an expense as opposed to being an asset or something that's going to help offset taxes or make them money in the future.

And so, you know, we talk to them about setting up retirement plans that are taxed advantage, you know, retaining key employees and bringing on good help. Those are all very important to the small business owner. And a lot of times they just don't think like we do because they're in the process of running their business on a day-to-day basis. And we're really in the business of looking for those, I wouldn't say tax loopholes, but the way to just to kind of avoid some of the taxes that, you know, perfectly legal and inside the IRS code and totally up to part. Yeah, that's a really big point because from what I remember, and you can correct me on the actual number, but the tax code has 50,000 or 70,000 or some unholy amount of pages in it. So how in the world is the general small business owner supposed to understand that and

know how to apply it to their business. So it's not loopholes like that's, you know, good into gray area. It's just there's opportunities that people just don't know about. And I think that's a huge aha for business owners to realize that if it's there and you take the tax advantage, it's not wrong. It's just there for you. But the IRS isn't going to go, hey, you know what? We're going to be processing your tax return your file. But before we do, we noticed a 14 opportunity. They're not going to do that. So you need someone that can can understand the business and then the tax code and serve up some opportunities for them to take advantage of. Absolutely. And, you know, I am a small business owner and I've explored a lot of these things and used a lot of these tools myself. And so it's very easy to convey that to another business owner. It's just, look, you're in textiles. I do financial services, but we are both small business owners. We are kind of set up either the same way or or a little bit differently. But I mean, there's only a few ways that you can, you know, be set up as a business. Soul proprietor LLC corporations. And so once you kind of understand all of the, you those various entities and how they're taxed, you can really find some strategic plants that will fit whatever your small business is. And I would venture to say that most small business owners, like yourself, myself, we feel like, you know what, I am just burning the candle at both ends.

I can't put in another ounce of energy of hours because I'm just grinding it out. So when you come to them and say, if we can show you how to take advantage of job and mitigate taxes and lower this and that and the other, all of a sudden it's like, wow, that's a breath of fresh air because I'm working the same amount of effort or hours, if not a little bit less. But now I'm having more cash flow and cash to do things with that are now my choices, whether it's planning for my legacy or taking care of my employees. But it's that stress and that load that's off of their shoulders. Is that what you're finding when you're working with some of your clients? Absolutely. I think the old adage in business is, you know, do what you do well and then hire people to do the rest of the

stuff. And a lot of business owners, they don't do that. And that's one of the first things we try and show them is, look, you're the main driver behind the revenue and the business. You're the sales guy. You're the tech. You know, you're the hands-on builder guy. You're not the secretary. You're not fielding calls. You're not returning the emails. You need to offload that. onto somebody else which frees you up to continue to do what you do best, which is drive revenue. And we really try and make that easy for them to understand. Yeah, and you're not going to come in and say, and plus, we're business coaches can help you drive revenue with this package.

You're not doing that, but you can show them how to increase that cash flow by mitigating taxes and expenses. That's great, which we covered. There's another thing that you said that I don't want to gloss over because I think it's a big piece that business owners don't recognize the opportunity. but with specific financial tools and products and packages, we don't need to get in the weeds of how it works or whatever, but talk a little bit about how you can show a business owner how to recruit and retain top talent.

Because when you can bring in and keep top talent, now all of a sudden you're just throwing grease or gas on the fire because now this top talent is bringing in the revenue and they're staying with you longer. And if you can do that with some financial instruments, that's a huge win. Yeah, totally. And it's not only, it gives you maybe an exit strategy for your business by having these people that you've taught and brought up in the business and they've stayed with you all these years. And it really does become, like you said, a revenue driver. And you know, you can do that with various ways by funding, you know, different retirement programs and or throwing golden handcuffs on these people, you know, giving them really the opportunity to, you know, too, to grow and be part of an organization. And, you know, who wouldn't want to do that? Most people, I think today especially, a lot of people feel like they're just serfs or peons,

you know, inside of their business. So when a business owner actually stretches out his arms and says, hey, look, come with me and I'm going to take you on this ride. And if I do better, you're going to do better, we're all going to do better. I think that carries a lot of weight, especially with people today. Yeah, it really does. And, you know, you mentioned another keyword exit strategy. I think a lot of individuals don't think about retirement till the very end or a business owner

think of exiting their business till the very end. But there's some really specific strategies that we don't need to go deep on. But I think planning for an exit and having resources available for a strong exit gives you opportunities and options and some of these financial tools that you're providing them, boy, that sets the stage a series of years ahead of the exit so that they can go, okay, now we've got plenty of opportunities for this strategy or that strategy. So talk a little bit about how that works for a business owner. Yeah, you know, I think most people that are small business owners think that their family is going to take it over at some point. And I forget what the statistic is,

but 50 or 60 percent of those businesses that go to a second generation, a third generation, oftentimes don't make it. And, you know, it's not that the heirs are bad people, but they Yeah, sometimes don't have to drive that mom and dad and grandma and grandpa. They don't have the passion. They grew up in a more affluent lifestyle, didn't have to, you know, work and pound the pavement like their forefathers did. So, you know, you can always plan for, yes, my children are going to take over my business or somebody in the family. But like you said, setting up some of these plans prior to you even start to think about selling your business, makes your business so much strong. and more attractive to somebody that may want to buy it in case, you know, the second,

third generation doesn't want to run it. Yeah, it reminds me of the book. Have you ever read the book built to sell? I have not. Excellent book. And it's one of those fictional written in fictional storybook format, but basically it's this business owner that goes, I'm done. I'm getting out of my graphic design business.

And he gets this business advisor to help him sell the business. And he goes, okay, well, first we need to make sure that it's in the right, you know, looks good for the buyer. And long story short, they put in some great practices and systematize the business. And all of a sudden, it's like, do I really want to sell? But you need to do these things ahead of making these exit decisions. Because if you wanted to do strategy A, B, or C, A and C might not even be possible unless you had done some things ahead of time. So it all really gets back to that pre-planning. And don't wait until your age, whatever, to plan retirement because it's like, oh, the runways only two or three years. We needed, you

know, six, seven, eight, nine years to have doing some of these things. So exit planning is huge. That helps the legacy of the business. And that also ties into that legacy for the owner, the business owner on the personal side. So talk a little bit about what you're able to provide some guidance for your clients, whether their business owners, to help both drive that legacy for the business. Maybe they're going to set up some charitable remainder trust for employees. maybe that then allows them to, you know, step back and provide some legacy cash, you know, distribution for family.

So, you know, talk a little bit about how that helps that two-prong approach. A lot of small business owners and high net worth clientele, I would say, really have a focus on what their legacy is. What are they leaving behind? And there's a lot of different ways that you can make an impact. Like you said, charitable remainder trust, you know, give. to your church or the university that you went to that you felt like gave you the leg up. And you really have to think about that stuff, you know, years before you decide to what that legacy is that you want to leave. But I know that a lot of clients are very concerned with that.

And we take that long approach and that long look. A lot of clients, a lot of small business owners, you and I are probably guilty of this too. We're looking at today. You know, we've got to drive revenue into the day to keep the doors open tomorrow. But really, if you want to plan for a legacy, that's something that, you know, kind of takes years to do and build up and make sure that it's done properly and so that your final wishes are fulfilled. And, you know, I like to ask my clients, listen, you know, do you want a plaque at Harvard or do you want one of the schools named after you? And we have to start planning for that. So, you know, it is a long-term deal. And that's our job for the small business owner that's not in financial services is, you know,

You know, you focus on today and we'll focus on the long term. Yeah, I love it. And, you know, there's another aspect that I think plays into this, which I've said so many times to financial advisors like yourself, veteran financial services, you almost are like a life coach, you know, where it's like, okay, let's talk about exit and legacy and all these kind of monetary things. But in reality, that entrepreneur business owner has such a driven mindset that all these decades in their business and now they've got this strategy and place to exit at

whatever age, whatever age that it is, are they just going to slam the brakes on and now go from 100 miles an hour, nothing? Or what will that look like? What will that exit look like or retirement look like? Are they going to consult two or three days a week? Are they going to play golf seven days a week? And I think that some of those things are so key to keep in mind because they look at that one thing, the exit, the sale, the transfer, whatever option or strategy that is, but then what?

And you literally, and I know there's statistics about there is a high mortality rate when some high driven entrepreneur retires and goes to nothing, they're like, wow, well, what now do I have? So do you work with your clients kind of planning some of those like non-tangible things? Absolutely. You hit the nail in the head. These people are all type A personalities. They drive and they drive hard and you get to the end of the road and all of a sudden you think that you did exactly what you were supposed to do and they're bored out of their minds. They're, you know, they don't want to golf and fish.

And so a lot of them will continue to do something else. you know, we kind of help roll into that second or third phase of whatever career it is that they want. Yeah, because then that ties into like phase two of the legacy. You know, the legacy might be phase one, which is here's what I'm doing with what I have right now. But, you know, what more and more people are taking better care of themselves, you know, eating better, working out, you know, keeping their health up. And the age of, you know, making sure my retirement dollars stretch to X age, that's now expanded. And so that retirement like that horizon now has changed to where it's like, maybe I could launch that second career, that, you know,

maybe that charitable work that I wanted to do while I was busily building my business, but I never had the time. Well, now I do. And so I think that's so huge to be able to go. We might have this layering of legacy where it's like, here's what we're going to do phase one with what you have. And then now with phase two, we now have another opportunity. I think that is a huge service that you're bringing

into your clients that that really outweighs just what to do with your money. That's a great point, Mike. Agreed 100%. Well, I think this is just spectacular, Michael. This is not just like, oh, let me put your money here and get this read of return. Those are all semantics. That's the easy stuff. The big stuff is why do you want to do it?

What's that legacy? What's that exit? What are some of those key strategies you can put in place ahead of time? So if someone is interested in learning more about what you do and reaching out and connecting with you, what's the best way that they can do that? that. Please visit my website at CDP. That's like Charles David Paul Insurance.com. Excellent. And I will make sure that that link is in the show notes. And I really appreciate you coming on. Michael, it's been a real pleasure talking with you. Thanks, Mike. Nice to be here.

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