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New Year, New Goals

Breaking a goal into manageable pieces will help you stay focused throughout the year.

By Marvin H. Feldman, CLU, ChFC

Why do we need to set goals? I hate setting goals because they make me work hard, but I guess that is a good thing. Just ask my wife, who says she married me for better or for worse, but not for retirement. So, here is my philosophy on setting goals.

Aim high and break it down
Set a high goal, but not so high that you will become discouraged and quit. Break the goal down into smaller, manageable pieces that will be easier to attain.

For example, you’ve set your first-year commission goal at $100,000 for 2005, but now you’re saying to yourself, “How do I do this?” First, break the goal into monthly, then weekly, then daily goals. Your monthly goal becomes $8,333, your weekly goal is $1,923, and your daily goal becomes $385.

Now you need to review your 2004 production numbers. For our purposes, we’ll assume your average case was $2,000 of premium with $1,000 of commission. Your goal is $100,000 in new commissions, so that means you will need to write 100 cases in 2005. Sounds like too many? If you break it down by month, it’s just a little over eight cases. Still too much? Break it down into weekly cases—now your goal is just two cases per week.

What’s your closing ratio when you ask people to buy? The industry average is one buyer for every three asked. If yours is the same, you will need to ask six people to buy each week in order to reach your goal of two new cases per week. That’s just a little over one closing interview per day, and there’s your goal: One closing interview per day! What are you doing with the rest of your time? Hopefully, prospecting for new clients.

Maybe your case rate is low, and writing 100 new cases doesn’t seem to be attainable. No problem. If you wrote 40 new cases in 2004 and generated $80,000 in commissions, your average commission per case was $2,000. If your new goal is $100,000, your caseload goal becomes 50 cases, or approximately one per week.


Offer more coverage
The alternative to more cases is bigger cases. In the previous situation, the commissions per case would need to increase to $2,500, but how do you generate this increase?

Raise your sights and the sights of your prospect. Don’t just plan for today’s needs. Look down the road five years and plan for tomorrow. Consider inflation, future pay raises, the growth of their company, increases in company lines of credit where the owner signs personally, other key people in the company, retirement planning goals—the list is long and the needs are great.

When you submit an application for new insurance, ask the underwriter how much the company will issue with the medical and financial information submitted. If you requested $250,000 and the requirements are good for up to $500,000, ask the underwriter to issue an additional policy for the extra $250,000. When you deliver the $250,000, tell the client that the company reviewed his financial situation and determined he qualified for an additional amount of coverage based on future needs and projected growth. The client may take all, part or none of the new coverage, but if only an additional $100,000 is placed, that is a 40 percent increase in the case size. You only need a 20 percent increase to attain your goals. If one out of two clients accepts the increase, you are right on target for a 20 percent increase in your production.

Family first
One caution: Don’t let your goals become so all encompassing that you forget about your family. Get them involved. Help them understand what you want to accomplish and why. Explain what the goal means for them: a new car, a vacation, college funds or just peace of mind with the extra money generated and the extra protection for your clients.

So set your goals. Break them down into manageable pieces. Run hard, run smart and remember to plan for family time.

Marvin H. Feldman, CLU, ChFC, served as the 2002 president of MDRT and has been chairman of the Top of the Table. A member of Mahoning Valley AIFA, his address is The Feldman Agency, Fremar Building, P.O. Box 30, East Liverpool, OH 43920.


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