Are you an exempt market dealer (EMD) dealing representative
and looking at ways to grow your business? Look no further...
no, I am not a business coach or infomercial, I am a lawyer who
identifies opportunities and risks to help those in the investment
business grow their businesses while protecting their reputation
and money. I use examples, as I will in this article, to tell you
how to grow your business, while mitigating the business risks
associated with seniors, a growing sector of our population.
The story about Mrs. Smith
Mr. Smith celebrated his 70th birthday with a big party
arranged by his wife, Mrs. Smith, 68 years old. All three children
and their spouses along with their 6 grandchildren and 30 of their
closest friends were at their large home for the party. Enjoying
good health, Mr. Smith operated his own business and Mrs. Smith
spent most of her time bringing up the children and helping raise
the six grandchildren. Any free time was spent travelling.
Any and all financial matters were managed by Mr. Smith.
However, just six weeks after his birthday, Mr. Smith suffered from
a massive heart attack and died without having prepared a will
and without any life insurance. He had a business with a loan to
the bank, which Mrs. Smith had signed as co-guarantor, and a
house with a small mortgage. Mrs. Smith met with her husband’s
lawyer who told her the bad news. She was in financial trouble.
Mrs. Smith turned to her best friends, Mr. and Mrs. Jones, for
advice, who she thought had not done very well financially as their
home and car were more modest than hers. However, she learned
that they had saved aggressively for retirement, had investments
with one of the banks and also had a son, Josh, an EMD dealing
representative, who sold interests in private investments. Mrs.
Smith asked Mr. and Mrs. Jones to arrange a meeting with Josh
as soon as possible. She knew Josh since he was a little boy.
Josh met with Mrs. Smith the following day. Mrs. Smith was
crying but asked if she could invest, like his parents, in real estate
rather than in the stock market which she could not understand
or follow, and she needed the income from the rentals that were
associated with the properties. She said that she understood land
and believed that it always increased in value especially with the
research these companies did to identify undervalued land that
could be developed for a profit. This was all explained by Josh’s
parents. Mrs. Smith also understood from Josh’s parents that
these investments had a return that was far better than what she
could obtain elsewhere. She had heard that the stock market was
unpredictable and she needed reliable income immediately. Mrs.
Smith hoped this was the answer to her problems.
Josh felt bad for Mrs. Smith and wanted to help her. He had
confidence that the products he offered through the EMD with
which he was registered, with their intrinsic leverage and value,
could solve her income problem. Josh explained the different
products that he thought would be best for her and explained
that some of the products were leveraged so if she borrowed to
invest against her house, she could make a nice return. While
Mrs. Smith was crying when the meeting started, after she saw
her income potential through a few examples, she wiped away
GROWING YOUR BUSINESS
BY SELLING TO SENIORS
By Ellen Bessner, Partner, Cassels Brock & Blackwell LLP