When people are looking to go into business for themselves, they tend to turn to the world of real estate. It's fairly easy to get started, it's perceived as "sexy," and everyone seems to know someone in the business. But is it the best industry in which to build your successful business? Here are ten reasons you may want to consider before pursuing your next career in real estate.
Real estate takes a hit during recessions and can be slow to recover. In fact, with the combination of the recession, interest rates on the rise, and minimal inventory, this may be one of the most extended down times for the real estate market since the 80s.
Recessions, like taxes, are inevitable; you can't ignore them, but you can prepare for them. With recessions come anxieties and uncertainties. When the economy tanks, companies downsize, constrain hiring and cut non-essential expenses. Insurance is one of the safest industries during such a crisis. Why? Families consider life insurance a necessary cost to protect their loved ones. That is why insurance professionals continue to succeed, even during a recession.
#2 More Potential Customers
Nearly 48% of all adults don't have any life insurance. So, if you were to ask 50 people at your next social event about their needs for life insurance, 24 people could be potential customers. There are another 27% of underinsured adults. This means there are another 13 people who may also need your services.
Compare that to the real estate market, where only 2% of adults consider buying or selling real estate yearly. Only one person at your party would be a potential client.
Finding the "perfect" home for a client can be challenging in real estate. It doesn't have enough bedrooms; the houses are too close together; it's not in the right neighborhood; it's over budget. The list goes on and on.
With so many options, life insurance always has the perfect product that meets the person's needs and budget. As a bonus, there are other solutions you can sell your client besides life insurance. You can help your clients with long-term financial and retirement solutions such as IRAs.
#4 Faster Sales Cycle
According to Zillow, it takes about five months for someone to find a home, get it under contract, and close. During that time, there are a lot of potential situations where someone will walk away and never buy. More importantly, you are not getting paid until the transaction is completed.
Life insurance only requires one or two meetings to understand the client's needs and goals. Then offer a few options based on those needs and objectives, and fill out the application. In some cases, your client can be approved in just minutes. The policy gets enforced, and then you get paid. The entire sales cycle can be as little as 1-2 weeks long.
With over 3 million active real estate licenses in the US, what are the odds that someone you know also knows another real estate agent? The competition can be cutthroat in real estate, making it even harder to get started in the industry and succeed.
There are roughly 170,000 life insurance agents in the US. There are more real estate agents in California than life insurance agents in the US!
Look at the number of "go fund me" pages there are for financial emergencies due to medical expenses or the death of a loved one. Why is this happening? It's because people aren't having a conversation with a life insurance agent, and that's because there aren't enough life insurance agents around in your community.
#6 Work-Life Balance
You might think that being a real estate agent does offer the work-life balance you deserve, but does it? How often do you get a call from a client, seller, or buyer when you are with your family and have to drop everything to show a property? How many weekends and evenings are lost so you can conduct your business? How much fun is it to be "stuck" at an open house for four hours and have no genuine leads come from it?
As a life insurance associate, you have much more flexibility. Most of your business opportunities happen during your typical work week. The client doesn't control your time anymore. Meetings with clients outside of regular business hours are scheduled well in advance based on your schedule.
#7 Grow a Business
As a real estate agent, you are an independent contractor for your broker. This means you can't grow your business unless you decide to take it to the next level and get your own broker's license.
In the world of life insurance, you can recruit a team and grow your business right from the start. In fact, recruiting is very much encouraged with most agencies you will work with. It is an excellent way to grow your business and make your dreams a reality.
#8 Income Potential
As a real estate agent, you have a linear line of income. This means that as long as you work, you can make money. It also means that there is a glass ceiling on how much money you can make. You personally can only close so many transactions per month and year. So what happens when you want to take a vacation, or you need to take off some time due to a medical emergency? Your income stops!
As a life insurance agent, who has built your business and team, you will have unlimited income potential. This exponential growth is due to your team doing business, and the residual income from their sales has no cap! This also means that while you are away on that two-week vacation to Europe, you are still earning income.
So you might say that you have a job as a real estate agent, but as a life insurance associate, you own a business!
Starting your own business in life insurance is minimal. You no longer have to pay for marketing your clients' property (that may or may not sell), no more paying for gas to take clients all over town for showings, or fees to join national associations.
On average, you are looking at between $300 and $400 to start your life insurance business. Unlike other business ventures, there is very little additional overhead you have to worry about. Even as you grow your business and add team members, you don't need to have an office you work out of. When you drive to a location to conduct business, there is a good chance that you will meet with multiple potential clients; otherwise, many of the conversations you may have can take place on the phone or via a video call.
#10 You Can Do Both
Freedom and flexibility are great things you get from being a real estate agent and a life insurance associate. You don't have to do one or the other; you can do both at the same time. Right now, the real estate market has its challenges. Now is a great time to try your hand in the life insurance industry. You can start part-time and go full-time whenever you are ready. Feel free to keep your real estate agent license active for the occasional sale and truly live your dream!
Now that you see the advantages of becoming a life insurance associate, take the next step and find out how you can get started with ValuTeachers. We are growing fast and would be very interested in having you be part of our team.