Brand New (Medicare) Agent Seeking General Career Advice

[sshafran]

I think it's crazy to spend $50k on leads, but to each his own

50k for leads /marketing is a worthwhile investment.

This past March I closed on a rental property. $119k, 20% down. Closing costs, etc, its about 28k.

It's a newer townhome in an easily rented area. After all expenses + putting aside for reserves - it'll profit at lest $3,100/yr conservatively. That's about 11% cash on cash return - not bad at all.

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If I spend the same $28,000 for marketing (or 50k?) - the 1st year return may be $35,000 or so -- give or take. That's 25% "cash on cash."

But... renewals! Next year, for that same box of money, I'll spend $300 in retention (?) and earn - lets say $30,000 *again* (assuming 1st yr had some true-up in it).

It's a massive, massive return on ROI.
----

The #1 regret I have from my first few years in Medicare is marketing on a tight budget. I'm not advocating recklessness. But getting your business to higher revenue faster rather than slower is just good sense. I didn't always think this way (or follow through with this type of thinking) - but I should have.

 

[somarco]

If you do right by your clients referrals will flow like water. Initially a trickle but eventually a steady stream.

With 500+ clients I write 30 - 40 per year from referrals. My only monetary investment is the cost of a 2x monthly electronic newsletter.

A few months ago I hired a firm to manage FB promotion. I pay a fixed $300 per month. It took a few months before I saw anything noticeable in leads and no sales. Over the last 90 days we did some fine tuning on my ads and I have added 14 new clients from that change. My investment so far is $1800 vs $4400 in commission.

At this point sales should grow at a faster clip for my $300 monthly investment.

 

[keese]

I would strongly caution against quitting your job to become a full time Medicare Agent at this time. With everyone fearing for their lives from Covid, it's possible that face to face appointments in the fall will be virtually impossible for new agents, so unless you're an absolute monster on the phones it's likely that it will be an extremely hard year for new agents. Just my 2c.

 

[ZJohnson]

50k for leads /marketing is a worthwhile investment.

This past March I closed on a rental property. $119k, 20% down. Closing costs, etc, its about 28k.

It's a newer townhome in an easily rented area. After all expenses + putting aside for reserves - it'll profit at lest $3,100/yr conservatively. That's about 11% cash on cash return - not bad at all.

--

If I spend the same $28,000 for marketing (or 50k?) - the 1st year return may be $35,000 or so -- give or take. That's 25% "cash on cash."

But... renewals! Next year, for that same box of money, I'll spend $300 in retention (?) and earn - lets say $30,000 *again* (assuming 1st yr had some true-up in it).

It's a massive, massive return on ROI.
----

The #1 regret I have from my first few years in Medicare is marketing on a tight budget. I'm not advocating recklessness. But getting your business to higher revenue faster rather than slower is just good sense. I didn't always think this way (or follow through with this type of thinking) - but I should have.

I appreciate where you are coming from on purchasing leads. I don't think I'd ever plunk down 50k because at some point I gotta believe the referrals would crank up but I feel ya on the ROI.

My question is: Where do you get your purchased leads from? I have dipped my toe in the water because of Covid but I've received nothing but crap so far. I listened to some of their calls they made on my behalf and they sounded slimy to say the least. The way they manipulate the conversation to get the qualified answers they need to send it over to me is very disingenuous.

 

[sshafran]

My question is: Where do you get your purchased leads from?

I do not purchase any leads. I used to - but now I do other forms of marketing. Specifically, I write letters to my local market and they call me asking for help.

I've had more success with this than with anything else - ever - by a long shot. It's not the cheapest way to market - but it's efficient. I can consistently write over 20 new people monthly and not kill myself chasing leads - they call me. When they call you... it's a completely different call then when you are chasing them.

In short - my marketing hits a small, targeted list, multiple times. That small list hears from me - with a local address - over and over again, beginning 8-months prior to t65.

My target is always for the First Year Commission to do just over the marketing costs. Year 2 + is pure profit -- and all referrals are profit.

You can check out what I'm doing at T65inbound.com

 

[KatieV]

I do not purchase any leads. I used to - but now I do other forms of marketing. Specifically, I write letters to my local market and they call me asking for help.

I've had more success with this than with anything else - ever - by a long shot. It's not the cheapest way to market - but it's efficient. I can consistently write over 20 new people monthly and not kill myself chasing leads - they call me. When they call you... it's a completely different call then when you are chasing them.

In short - my marketing hits a small, targeted list, multiple times. That small list hears from me - with a local address - over and over again, beginning 8-months prior to t65.

My target is always for the First Year Commission to do just over the marketing costs. Year 2 + is pure profit -- and all referrals are profit.

You can check out what I'm doing at T65inbound.com

Beautifully said, and one of the most valuable things I've read on this forum so far...

 

[somarco]

In short - my marketing hits a small, targeted list, multiple times. That small list hears from me - with a local address - over and over again, beginning 8-months prior to t65.

My target is always for the First Year Commission to do just over the marketing costs. Year 2 + is pure profit -- and all referrals are profit.

You can check out what I'm doing at T65inbound.com

@sshafran this is a real find.

500 names @ $0.70 each per month is a $350 monthly investment. Very inexpensive compared to other DM programs.

Thanks for sharing.

 

[DecisionMan]

Lots of replies to the original post, all of which are good, but in my opinion for a newbie:

Most of us who've made it successfully in the insurance business--regardless of product line--are successful because we do what all the failures won't do: Stick it out, push through the rejection, make lots of calls, fail forward. Eventually we find our product line that fits our personality and like, get good at it, build a client base, make good money.

The average insurance agent makes $40,000 yearly. The $150,000 one person referred to is where successful agents are. Renewals add up as do referrals and a wider product line based on experience over the years.

Most of us who are still in the business because of what I referred to above, we started captive and learned a few things from the company or agency (looking back, probably not a whole lot), but eventually got dismayed at the body count of failed agents still hanging around, the low commissions, and other issues too numerous to count in a captive shop. Of course, for some, they like a captive arrangement or need a captive arrangement.

But the big money is in going independent, running your own business and working very hard. There's an insurance proverb that says "in insurance you work really hard the first three years to make a little money so that the rest of your life you don't work as hard and make lot of money."

As you've read in the posts above, there are plenty of different ways to get business - from lead drops, phone calls, FB and internet leads, referrals, seminars, etc etc etc - oh, and once marketing firms know you're in the business you'll get tons of calls about the latest lead method where you can become a millionaire.

Assuming you won't get discouraged at the rejection, long hours, low earning, company issues, my advice is to learn everything you can and decide to specialize in one product line and one product until you know it so well you could sell it in your sleep.

I don't care if its term life, med supps, or pet insurance (!). There are markets for all these products, the key is knowing it well and how it helps that target market.

Part of learning for a life/health license should be AHIP. Just pay the fee and take the course. Its a good course and opens up a lot of carriers to you. It gets easier every year, but its great education.

Keep in mind that the life/annuity business doesn't have much of a renewal base, but the initial commissions can be a lot higher. So bank those bucks.

Health commissions, like Medicare, have real nice renewals - and its great to start a year where you can plug in your monthly renewals to Quickbooks and know what you'll have coming in. Medicare sales also start a relationship with clients yearly where you can eventually sell a wider set of products (life, LTC, ancilliary products, annuities).

May I make a few critical comments about your original post without causing offense?
1. A background in marketing and sales would appear to be helpful, but it probably won't be.
2. Being "stuck in Medicare" has been a great living for a lot of us.
3. "Have to keep up with AHIP" - if you don't like that, you won't like every carrier's AML requirements, CE requirements, carrier product training. AHIP is a basic foundation of knowledge.
4. "I could be making just as much money selling different products." Please don't be a jack-of-all-products. You won't make much money.

Can you do a spreadsheet? Spread these numbers:
A) 10 renewal MAPDs monthly, January - December in year 1. What is the monthly and annual commission at $250 per.
B) Year 2 the same as A. Only add in the monthly renewals for each month sold in year 1.
C) Year 3. Same as A, plus monthly renewals from new sales in year 2, plus renewals each month from year 1 (those are now a full 12 months every month)

You'll see the Medicare renewals are huge. Of course there's some bleed off from clients leaving or dying, but spread it out 5 years and you'll see you've easily crossed six figures.

Of course, it assumes you're working and actually selling 10 MAPDs monthly. Now, how do you do that? That, my friend, is the trick and your marketing experience won't necessarily help you there. That's another discussion thread, (and I've become too involved in my reply to bother extending it further!!)

All the best.

 

[ZJohnson]

I do not purchase any leads. I used to - but now I do other forms of marketing. Specifically, I write letters to my local market and they call me asking for help.

I've had more success with this than with anything else - ever - by a long shot. It's not the cheapest way to market - but it's efficient. I can consistently write over 20 new people monthly and not kill myself chasing leads - they call me. When they call you... it's a completely different call then when you are chasing them.

In short - my marketing hits a small, targeted list, multiple times. That small list hears from me - with a local address - over and over again, beginning 8-months prior to t65.

My target is always for the First Year Commission to do just over the marketing costs. Year 2 + is pure profit -- and all referrals are profit.

You can check out what I'm doing at T65inbound.com

Thanks... I have been doing the same recently but only hitting them once with little success. I have just recently moved to your strategy, less people, more hits. I'll let you how that works soon. I know I need to work on my letters that I am sending. Too wordy but working on breaking it down over the course of several letters and earning their trust. I have reply envelopes and permission to contact forms included in each letter.

The site talks about live stamps vs an indicia. Do you have any opinions on that? I currently use an indicia and addressed with an avery label to get the cost down. I've had some in various industries tell me a hand written address and a live stamp makes a difference.

 

[ZJohnson]

If you do right by your clients referrals will flow like water. Initially a trickle but eventually a steady stream.

With 500+ clients I write 30 - 40 per year from referrals. My only monetary investment is the cost of a 2x monthly electronic newsletter.

A few months ago I hired a firm to manage FB promotion. I pay a fixed $300 per month. It took a few months before I saw anything noticeable in leads and no sales. Over the last 90 days we did some fine tuning on my ads and I have added 14 new clients from that change. My investment so far is $1800 vs $4400 in commission.

At this point sales should grow at a faster clip for my $300 monthly investment.

Sounds pretty awesome to me. I am at the beginning stages of figuring this out. Lots of activity, little flow. I am certainly learning all the things NOT to do. Any hints on getting that faucet from drip to gush any sooner?