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Data And Technology: The Keys to Providing Comprehensive Wealth Advice with Paula Nelson

Data and technology are critical when it comes to providing holistic wealth advice. They are two essential resources that can help advisors gain a deeper understanding of their clients’ financial situations, enabling them to offer more tailored recommendations.

In today’s episode, Jack talks with Paula, Managing Director & Head of Growth Strategy at Global Atlantic Financial Group. Prior to joining Global Atlantic Financial Group, Paula served as CEO and President of Transamerica Capital, and Managing Director for Aegon Financial Services Group. In her current role, Paula’s primary focus is on growth that involves bringing insurance strategies and alternative asset options to financial professionals.

Paula talks with Jack about the role technology plays in the insurance industry, how Global Atlantic applies innovative approaches to offer better services to financial professionals, and how data and technology are key to providing holistic wealth advice.

This podcast is intended for Financial professional use only.

The opinions expressed are those of the opinions of the speakers as of May 2022 and may not come to pass. Nothing said should be considered a recommendation to buy, sell or hold any security product.

Annuities issued by Forethought Life Insurance Company, Indianapolis, Indiana.

Global Atlantic Financial Group (Global Atlantic) is the marketing name for The Global Atlantic Financial Group LLC and its subsidiaries, including Forethought Life Insurance Company and Accordia Life and Annuity Company. Each subsidiary is responsible for its own financial and contractual obligations. These subsidiaries are not authorized to do business in New York.

What Paula has to say

“If your organization is not investing in digital data analytics, you should be asking why. Why aren’t we making those investments? Technology and data are key to really providing holistic wealth advice. “

– Paula, Managing Director & Head of Growth Strategy, Global Atlantic Financial Group

Read the full transcript

Jack Sharry: Hello, everyone, and welcome back to WealthTech on Deck. I have the privilege of speaking with industry leaders each week around the issues that inform and advance financial advice, wealth and asset management, retirement, insurance and annuities, and technology. I talk with leaders who are showing the way as we seek to help advisors, clients, participants, and firms enjoy better financial outcomes all around the confluence of digital and human advice. Most of our conversations center around strategy and where industry trends are taking us. A prime topic that continues to gain steam and is becoming increasingly important is the role annuities and guaranteed structures play in creating a household portfolio. Today we will talk with someone who has been an innovator in the annuity space. Paula Nelson joins us today. She is the managing director and head of global growth strategy at Global Atlantic Financial Group. Paula, welcome, and thanks for joining us on WealthTech on Deck.

Paula Nelson: Thank you, Jack.

Jack Sharry: Why don’t you tell our audience about Global Atlantic? It’s this name I kept seeing, like, where did they come from? It’s like the old Butch Cassidy and the Sundance Kids… Who are those folks? I know you’ve worn a number of leadership hats there. Please tell us what your company is about and how you got started, the roles you’ve played, then we’ll talk about what you’re working on now.

Paula Nelson: Yeah, so Global Atlantic is a life and annuity insurance company, US focused and based today. But we are in both the individual markets business, so selling to consumers via some partnerships through broker dealers and independent advisors, and also in the reinsurance space. So the company sort of came to be over the last decade or so, it was a spinoff from Goldman Sachs. And we had a subset of, you know, industry professionals that spent most of their career in the insurance space, married up with a group that came from the asset management, Goldman space, and really entered the fixed annuity side of the business initially. We have certainly adopted other strategies beyond that, both, you know, RILA type products, variable annuity products, and again, we partner predominantly through broker dealer groups. A little over a year ago, we were acquired by KKR, which is a large institutional asset manager also works in the private equity space, works predominantly with very large institutions like pensions, and they manage general account assets and other unique strategies. So we have officially come together and continue to make strides and market our products.

Jack Sharry: Well, I know you are working on some new and exciting projects, please share with our audience, what are you working on now? I know that there have been lots of changes and advances, and you’re doing some pretty cool stuff. So tell us about it.

Paula Nelson: I think if you think back on my career, I’ll just give a two second update just on my history. So I’ve spent almost 37 years in this business, predominantly on the manufacturing side. So the insurance companies space in various roles. My passion is probably most rooted in distribution. And it’s for us wholesale distribution, we don’t have a career agency force, we partner again, with large broker dealer organizations and independent agent groups to offer our products. And so you know, over my history, we’ve watched, you know, a lot of innovation happen predominantly around product. What I’m focused on right now, with, with the organization, my prior role of running the day to day business is really where the industry is headed, especially as it pertains to our company. But most importantly, I think, the wealth advice, wealth management industry in general. And so I get the fun job now of thinking about how do we, you know, stay current and stay with where wealth management’s going? And so a big part of my focus is around wealth tech, and how does you know, financial technology, how does insure tech fit in to the broader ecosystem in a more holistic environment? So we’re not just managing money anymore, we’re thinking about, you know, what do we do with the money that we’ve managed to save and invest? And how do we think about retirement and that journey? And so I spend most of my time thinking about that. I’m somewhat obsessively passionate about trying to modernize, especially the insurance space, I’ve really struggled to get out of the paper business, I don’t know why we cling to our applications and our checks and our fax machines, but we do. So I spend a lot of time thinking about how do we, first of all, pick the right technology, both for our organization and for our partnerships? And then really, how do we think about adoption? How do we get financial professionals particularly those that today used insurance products, how do we get them to move over to a digital electronic experience? And it takes time, takes a lot of energy. We’re certainly not there yet. But I will tell you, Jack, the technology exists, it’s there. Adoption is what we’re needing.

Jack Sharry: So talk a little bit more of that broadly, and then we’ll get into what you’re doing at Global Atlantic specifically. So you know all the players that are doing similar work and my guess is you’re doing a lot of work with them. So our friend David Lau at DPL, the folks at FIDx, the folks at other insurance companies, your counterparts, contemporaries that are working on this. Why don’t you, for our audience, why don’t you describe sort of, in a macro sense, what’s going on there, and I’ll give you my two cents on it. Really what annuities have to offer is tax advantages and risk management, if we were to look at it from a purely asset management kind of perspective. So talk a little bit about that, because I, my sense is, that’s where you’re going. And that’s what’s going on. And really, there’s this convergence between what annuities and insurance products have to offer or capabilities or structures have to offer. So it marries up where you’re managing at the household level, using the appropriate kind of products and structures, to improve outcome, to manage risk, all that kind of stuff. So talk about what’s happening in the industry.

Paula Nelson: Yeah, and I’m going to focus again, around the insurance space, specifically annuities, because that’s the area obviously, that I have the most knowledge on. There’s really two things that digital and you know, electronic means can do for us. Number one, and most importantly, from probably a financial professional’s perspective is, is really helping understand how these products can fit into a portfolio, try to pick from the myriad of products that are available. And then really, to your point, how do I structure it? And what’s the right mix? I think that’s probably the easiest part in my mind, because it’s what they do with everything else in their day to day practice. They really just want to take these risk and tax efficient mitigators and embed them in an overall strategy. And I think that part will be a good experience for them. The bigger thing that it does, from my perspective, selfishly is it helps us to modernize in the insurance space, our business. It gets us where the advisors are, it’s their ecosystem, it’s their platform. And it’s as simplistic as having an industry standardized process for our products. So those are the two things that I think are most important for me,: That’s great. And I know you’re not alone, you have many industry counterparts and contemporaries doing the same thing. So exciting things ahead, in my view of what’s going on in the annuity world. Talk a little bit about what you do, and I… at Global Atlantic, because I know you’re doing some interesting and new things there. And I’m sure our audience would love to hear.

Paula Nelson: Yeah, so again, my focus is predominantly on growth. And where, someone keeps talking to me about Wayne Gretzky, and where the puck is headed. We’re trying to think about that. And so I mentioned earlier that we have a new parent organization, KKR. And as I’ve learned more and more about that organization, and their really desire to, this is their word not mine necessarily, democratize alternative type products and strategies, to do the same thing, bring alternative asset options to financial professionals. There was, surprisingly more similarities in our insurance world and these alternative assets. And I would even lump a third category in, that we’re not in this space today, structured products. These are kind of the things that we see emerging and have some interest from financial professionals. Structured products might be something my client is interested in. I certainly have to think about insurance and risk. So probably annuities, some sort of lifetime income management is needed. And then boy, you know, a 60/40 bond stock portfolio really isn’t making it work anymore. For me, and I’ve heard a lot about alternative strategies. Very wealthy people get access to those, how do we think about, you know, getting those down to, you know, the average mass affluent wealth, you know, professionals to make available to their clients. And so in, by dialogue with them, some of the pain points are, you know, they feel like complex products. So, is there an education component? Annuities have that same feel. They talk about the operational new business submission process. That’s challenging. Can technology help with that? And then how do I manage it within my client’s portfolio? How do we embed everything together? And so in learning about that piece of it and the opportunities that we have to learn from each other, I’ve spent just a lot of time also thinking about how does that industry continue to innovate? And are there insurance strategies that can be married up with alternative strategies, and so, you know, I get the fun job of kind of thinking about that for the future of our business. I know others are as well, I always am a big believer in collaboration in the industry, when there’s a trend when there’s a pain point, the more we solve it together, the better for, again, the advisor and client experience.

Jack Sharry: So harkening back to how asset management operates, where you have to think about risk and tax and cost and so on. What you’re saying, basically, is this the same as using something generated by an insurance company or developed by an insurance company, is that what we’re talking about?

Paula Nelson: Not necessarily. So I think I put it in a very broad umbrella that I think most clients, most advisors understand stocks and bonds. There’s other things they should be thinking about, particularly as you know, they amass more wealth. I think, as they think about alternative asset strategies, and alternative risk mitigating strategies or tax strategies, having access in a streamlined manner to products that they want to learn more about, and potentially use with their individual clients makes a lot of sense. That’s where the similarities generate, from my perspective. The products certainly aren’t the same, by any means.

Jack Sharry: Sure.

Paula Nelson: I don’t pretend to minimize the complexity of them. I think we can make them much simpler in the advisor-client experience in describing what these can do for a client portfolio and how it can improve their outcome vs. how does the product work and how does the sausage factory, you know, generate the sausage. So I think those are the things that I think about when innovation happens, because the number one thing I hear from advisors all the time, you know, “You gotta make this stuff simpler, I don’t have all day to be an expert on every single category. I need education tools, I need case studies on how this can benefit a client. And I need access to data and analytics to help me make a recommendation.” So that’s consistently what I think we all hear from financial professionals who are trying to serve a very broad range of clients, and do so in an efficient manner.

Jack Sharry: So one of the things that pops to mind, but I want to make sure you want to go there is just so your job is to develop new product ideas and make them simpler and easier to incorporate. Do you want to get into the platforms you work with, the broker dealers? I always think in distribution, or do you not want to get into that?

Paula Nelson: You know, the only reason I don’t is I think we almost have to ask permission for me to talk about any named organization, and I probably can’t go deep on any particular product. Because then our compliance people are gonna want to look at this and scrub it and do all the things compliance people do. So I’m trying to keep it more thematic, at a high level…

Jack Sharry: Yeah.

Paula Nelson: To avoid that trap.

Jack Sharry: There’s lots of interesting things happening across the industry, we’ve had a number of guests on our program on the topic of annuity structures that are getting increasingly innovative and attractive for both investors and for advisors. How does this get distributed? How does this play out in the marketplace? You may not be able to talk about specific platforms or what have you, But I know there’s a lot of activity around that sort of thing. So talk, talk a little bit about it. How, how does an advisor get to incorporate and utilize these kind of products?

Paula Nelson: Yeah, I think, you know, we touched on it a little bit earlier, I think to the degree our industry can bring what we have to offer inside an advisor’s desktop, inside where they do business, where they manage their client portfolios. All kinds of innovation can happen at that point, and innovation that actually can be executed upon. So it’s not a product concept. So I’m trying to get away from the concept of packaged products. And think more about portfolio construction, common term used all day long by the professionals that we’re trying to work with. The ability and the, the key that technology will allow is these products to sit alongside of other things that advisors and clients can work with much more seamless than a standalone package product that always has a secondary thought, “Oh, yeah, I’ve got to think about that in terms of my overall pie chart for my client.” And so, you know, I’ve seen there’s multiple technologies and some really amazing things that are exciting that are out on the market today. And as you think about how do we get this into financial professionals’ hands, you know, you hear the terminology a lot about financial marketplace. And so this is where I go to, you know, get access to these different strategies that my client can use within their portfolio and in many cases, you know, strategies that very wealthy people have only had access to in the past and so as you think about an advisor’s ability to incorporate in a very seamless fashion, you know, a front end educational component, embedded with, you know, a business submission feel that looks and sounds a lot like what they do every single day. And then ultimately, an ability to service the client, you know, utilizing those strategies within their platform in real time. So those are the things that we think about from an innovation standpoint. Not a new product, we think about the process. How does our strategy, how does what we bring to the market fit into that process?

Jack Sharry: So I know she’s a friend in common. Heather Kelly, who’s at Allianz, was on our podcast and her comment about what you’re describing, your thoughts, is she says, the future of advice is the desktop. Do you agree?

Paula Nelson: Completely and 100% agree, I do. People get nervous. And I’m not trying to describe some sort of robo replacement for the world of advice. Because I think in terms a lot, my own life. I’m someone’s client, I work with a financial professional, I don’t try to do these things on my own. The self help group will always be out there. But I think a lot of people that look, feel, talk like me, still want to work with an individual on their plans and advice is important, particularly the more complex, and the older we get. And as we think about next generations. And so I think what that desktop and access can provide to financial professionals who really want to expand what they do for clients is critically important to how they become more than just, you know, a money manager.

Jack Sharry: Yep.

Paula Nelson: And I don’t know how they do it without technology, because we’re all individuals. And the reason I work with a financial professional is I want that individualized advice. And the desktop makes that happen.

Jack Sharry: Yeah, and I’m sure we agree on this, but I’d love your comments. But as things get more complex, as there are more accounts, as there are more different product types or structures, it’s inevitable that you’re going to really need technology to keep track of all this stuff, and to coordinate and integrate and set it up so that the investor ultimately gets what they’re looking for, which is achieving their objectives. But along the way, managing risk and, and addressing tax, and all the things that you have to consider as you’re… it’s not what you make, its what you keep. So you want to make sure that that’s all in place. So I’m assuming this is all part of your thinking. In fact, I know it is. But I’d love your thoughts on that.

Paula Nelson: It is and again, I go back to my own personal experience, I’ve seen some of the most recent technology that, you know, I actually wanted to ask my financial professional, do you have access to this? Because in a world where we’ve all learned to even interact with our advisors in a virtual presence, the ability for them to share a screen and walk me through my own situation and show and click on things that give me examples of how something that I really didn’t understand could benefit my portfolio and the ultimate outcome of what I’m trying to achieve. It was very exciting to see some of those things and the advances that have really happened. And so, you know, I guess my passion around this topic is I can’t wait for more financial professionals to be utilizing this, for more firms to, you know, whether they partner with, you know, a particular provider, platform provider, or they embed and build their own, you know, I’m not making a rally cry for either or, but with the digital technology that exists, it all starts to look and feel similar and familiar. And the more and more advisors can, you know, tap into that, I think just the more they have to offer their clients in a way that, you know, gives them comfort too. You know, we’re under a lot of regulatory pressure, I can’t imagine, you know, from a recommendation standpoint, how advisors, you know, go through the myriad of options they have for their clients, and which one is in the client’s best interest. You know, it’s a, it’s the buzzword out there, and boy technology can sure help, you know, solidify a recommendation, and capture, you know, why it happened. So there’s just so many benefits in adopting and enabling, you know, this sort of technology.

Jack Sharry: So you’ve talked a little bit about where the puck is going. I’d like you talk a little bit about what you predict over the next three to five years. I have a hunch, it’s gonna be less friction, there will be product choices or structure options that make sense. But talk a little about that. What does, you wave a magic wand, and what does the future hold over the next three to five years as advisors, as we as an industry make it easier for advisors to do their job.

Paula Nelson: I can’t imagine a scenario where three years from now we are still accepting paper and applications for the majority of the type of business that we’re working with. I think digital solutions are going to be the expectation. They’re going to be mandated. There’s too much risk in that doing those types of things. And so I picture three years from now a very digitally enabled experience. And I picture a world where, you know, from, again, the insurance company perspective, we innovate around what we can do, what our various companies are experts in and we really try to think about the end client and all of that innovation. I also think about new markets. Clearly the regulators and our government officials want people to save for retirement. They’re making all all kinds of new regulatory enhancements that allow people at a very young age to start building that nest egg more and more, as we know, pressure on ourselves to save for retirement. And as they think about, okay, we want to keep people inside of the defined contribution type environment. They’re low cost, they’re transparent, they have fiduciary overlay. There’s all kinds of things that the regulators like about that. The part that, you know, has been a challenge is okay, well, how do I now take that and turn it into an income stream when I do go to retire? And now how do I keep it portable? And, and how do I, you know, get access to things? Well, that same technology that is going to help in an individualized advice environment, will also help in an institutional, you know, defined contribution environment. And I want to continue to talk about new markets and how we serve the broader range of consumers, not just the wealthy, who have the means to get personalized advice. There’s ways to take that technology and bring it down market to people who, you know, still want an element of advice, and technology can help them through that. So those are the things that I would imagine three to five years from now you’re going to see.

Jack Sharry: It’s fascinating to watch what I call convergence of wealth management, asset management, insurance and annuities, technology, defined contribution. So it’s not just the accumulation of assets, but the distribution. And it’s all sort of meets in the middle, and a structure that has its place, and I predict it will expand, is the role of the annuity in all that. Certainly in defined contribution plans, that’s a hot area and also on the wealth management side. It just makes sense, given the attributes of what the offerings can bring to a client. But maybe you want to comment about how that all comes together, because that’s my prediction is it, it does very nicely come together, where the winner is the client and so too the advisor and the firm.

Paula Nelson: Yeah, I completely agree. So in my mind, how it comes together is you know, you have segments of customers and clients that you work with in these large financial institutions. So how things are embedded, how you, you know, work with certain level of clients, and how you work with, you know, an emerging group of clients, younger, you’re trying to get, you know, a relationship built early on, all those same tools can be of benefit, in how you want to experience that both from again, a client and advisor perspective. Everything we do in our day to day world, our lives, as consumers, as financial professionals, we’re doing it today. It just needs to move to our space, to our industry, I believe it will.

Jack Sharry: So, Paula, as we look to stay within our half hour self imposed timeframe, we’re gonna wind down here a little bit, what are three key takeaways that you’d like to share with our audience in terms of what we’ve covered on today’s, today’s show?

Paula Nelson: Yeah well, you know, you’ve heard my rant all day here now.

Jack Sharry: No rant. It’s all good.

Paula Nelson: Yeah. If your organization is not investing in digital data analytics, you should be asking why, you know, why aren’t we making those investments? Technology and data are key to really providing holistic wealth advice. I can’t imagine a scenario where you could effectively do it for any sheer volume of clients. And really driving adoption. It’s the responsibility of all of us, you know, whether you’re a distributor, a manufacturer, an asset manager, we all have to be talking about change management, digital, and how to incorporate wealth advice to our groups.

Jack Sharry: That’s great. So, Paula, this has been great. I’ve enjoyed not only today’s conversation, but our conversations leading up to it. I’ve learned a bunch, appreciate it very much. As we do with our podcasts each week, I’d like to ask what you do outside of work that is interesting or unique, or something you’re particularly passionate about? So what do you do when you’re not talking about annuities?

Paula Nelson: Well, I spend most of my time working in the northeast, but actually live in Minnesota. So, not everybody knows that. If you live in Minnesota, you learn to love one thing, the outdoors.

Jack Sharry: Yes.

Paula Nelson: Otherwise you wouldn’t live here. So even in the winter, I enjoy spending a lot of time outdoors. Friends, family, that’s why I’m here.

Jack Sharry: That’s great. Good for you. So for our audience, if you’ve enjoyed our podcast, please rate, review, subscribe, and/or share what we’re doing here at WealthTech on Deck. We are available wherever you get your podcasts. Thank you again, Paula. It’s been a real pleasure, and I look forward to our next conversation.

Paula Nelson: Wonderful. Thanks, Jack.