Welcome to the H VAC Financial freedom podcast, a show where we talk about business ownership and financial freedom by sharing stories and advice of experts who can help you get there. Now your host john victoria. Hello and welcome to the H VAC Financial Freedom podcast, a podcast for business ownership uh sorry for business owners, where we talk about growing your business building wealth and really creating a legacy for yourself. And so I'm really excited because today we have a special guest for you. Mr Nick Crowe, who is a graduate from Salzburg University.
He's graduated with a double major in marketing and management as well as a minor in professional sales. After graduating, he now works with Federated Insurance where he has completed his Master's in commercial business insurance, specifically for contractors and so really excited because he's been working with them for a number of years and um really he's responsible for helping businesses of all sides in the contracting space. You know, one man band all the way to several 100 employees and his goal. And Federated goal is to not just, you know, work with their client, but how do you protect them now and into the future And so really excited to have you nick how you doing, john, I appreciate you being here.
Yeah, I'm gonna try and make insurance is less boring as possible. I'm sure everyone's gonna be super excited to see insurance in the title and they're gonna jump all over. You always know that's the most exciting topic. But no, I appreciate you having me. I mean I'm excited to be here and I'm excited to kind of talk through a couple of the questions you got for me and just chat man, I'm excited, I love that. So you know, maybe before we jump to your store at actually on that point that you mentioned like what, what do you love about insurance?
Like there's, there's so many things out there that you could possibly work on. Why specifically insurance man, That's a that's a good question. So insurance can mean so many different things. You know, most people think, okay, insurance is simply I have to have it, I have to use this to protect my house, my car, my family, my business etcetera. It's used as a spread of risk to protect something. That's the best way to just simplify what insurance is, What I personally like about insurance is changing someone's mindset from it being this is a burden, this is something I have to do every single year.
This is something that I'm required to have to actually being able to change that mindset and truly turning it into being an asset for your business and using your insurance program, using your insurance company, using your insurance agent to help your business. Whether that's for, from a risk management standpoint, whether that's from making sure that you have the best program that best fits you. Um, and then it dives into the side and not just your, your business, but protecting your family, protecting future generations and your your your family, excuse me.
And then protecting future generations of your business. I mean no no business owner starts the business with the intent of this is gonna fail. So that's my job. Every business owner has their C. P. A. Um you know they've got their financial advisor, I think an insurance agent is just as much of an asset to a business as um anyone else that you may hire to help your business grow. So that really excites me to sum that up is just to change the mindset of someone who looks at it as a burden and really shows them and introduces them how it can be an extreme asset to them and their business.
I see because it's like you see that line item on your profit and loss like that's that's money that is not going into my pocket but um so it's kind of like you're saying it's not just a liability but it's like what what are you getting with that and what can that do to set you up because you know life, life life does not go the way that we expect especially as a business. I mean everyone who's listening this, you could probably, you know starting your business, it probably wasn't the way that you thought it would be getting into it and then life happens um and protecting yourself against those moments like you want the you want the dream to continue to go on right.
You don't want to get hit by this unexpected thing and boom, you're out of the game. And so that's why I wanted to have you on here because it's such an important thing when considering your strategic planning for, for your business. And so, um, and before we just dive specifically into insurance, like, um, so me and you, we first met, it was at a aka event. It was fall meetings. This was just a few months ago. Um, and it was, it was a great event. Um, and you, you hosted a session, it was a lunch session.
You're asking different questions for contractors to, to really think about. Um, are they, are they really thinking about their insurance and protecting their business in the right way. Um, and then that got me thinking well, um, how did you even get there? Like out of all we met like, what happened before? Like how did you get to where you are today? I was the one kid in the world that grew up saying I'm gonna work in insurance. No, I'm just kidding. Nobody, nobody grows up wanting wanting to be an insurance.
Um, like you said, I went to Salisbury University, I knew I wanted to get into business. I'd always grown up wanting to be a business owner. Um, my dad served in the military, once he got out of the military, he started his own business. So from a very young age I saw that entrepreneurship mindset and that spirit, I maybe just didn't have the skills that some of your listeners might be having to start an H. VAC business. Um, but what I really liked about Federated and when I jumped on board with Federated because it kind of gives me the opportunity to run my own franchise, run my own business.
I treat my clients, I treat my territory, I treat everything that I do as if it is my own franchise and Federated treats me as if it is my own franchise. They give me the freedom to allow me to do what's best for myself and for my clients. So that's kind of why I got into the insurance world because I didn't necessarily end up going the route of beginning to be my own business owner. But on the other turn I get to help business owners, which in my opinion, especially contractors, which is what I specialize in.
We're talking about it earlier. They are the bread and butter of this country. They are the most selfless best people. Um, and they're fun to work with. Um, so it may not necessarily be the quote unquote insurance. That's super exciting and why I got into it, but allows me to work with my favorite kind of people and still operate, how I want to operate. Amen to that. And well, first off, I want to say, you know, happy veterans Day to your dad, you know salutes, salutes off to him.
Um And yeah just and I think it's such a great entryway as well. It's like you know you want to be a business owner and then you're in this franchise treating his own business and that's that's such an incredible thing because it's this this mindset of ownership right, taking care of your clients and and really helping them succeed at at a higher level. Um And so I guess it's a spin off from that. You know there's so many different places that you could possibly work at specifically for insurance And so you know there's all types of products out there.
So why could you tell us a little bit about Federated but also like why you why you chose to work with them? Absolutely. Franchise. Absolutely. So you mentioned we met at the A. C. C. Event Air conditioning contractors of America. Um Federated partners with hundreds of different associations for our contractors. That's all we really specialize in from an insurance standpoint are about 10 types of different industries. And the bread and butter for Federated. Our our contractors. Um So one of the main reasons that I that I chose Federated over the thousands of different insurance carriers or companies out there is just how unique and how unique of a product that we that we truly do have.
Um no other insurance carrier it's gonna give me the opportunity to walk in and go talk to hundreds of different A. C. C. A. Members or a separate association member ph. D. C. You name, it is going to give me a quote unquote sales rep that opportunity that Federated does um a big part of me for sales because let's be honest, an insurance agent and business owners were all in sales. You have to stand behind your product and there are so many different insurance products out there where I definitely couldn't say I necessarily stand behind.
I'm not bashing anyone by any means but I truly truly truly believe that Federated has the best to offer out there in the market. So it was really easy for me to jump to feed in and head first into being able to partner with federal and say yes I'm gonna represent you. Um Not only that they invest a lot into their employees. So anytime I tell anyone that might be interested in taking a look at a Federated products compared to their current program that they have in place, just know that that agent that you're working with is extremely knowledgeable in the industry.
You you had, you had kind of hinted at it earlier, they send you up every new employee, they send you up to headquarters for about nine months to essentially get your masters and commercial insurance to learn the h back industry to learn the different contracting industries and to learn Federated's product and what exactly is going to be the best solution to a problem. Um Overall they invest it's give or take about a quarter million dollars into each employee throughout those nine months to make sure that we are able to serve our clients the best.
So Federated put a lot into me. So I want to be able to return that and I just didn't see any other route from an insurance world that was going to invest that much. Um Why Federated's little unique to? And I think you were gonna kind of touch on this. And what gives me a huge advantage is we're what's called a direct marketer, which to basically sum it up, it's basically like buying insurance from a retailer verse a wholesaler. So instead of you age fat guys that are going out there and buying products from a retailer, you buy from a wholesaler.
I'm the only one that has access to Federated product, I only represent Federated. I only sell Federated, it's not an agency that's a middleman that brokers it out to different carriers. So that gives our client to be able to have the direct relationship with the carrier with underwriting with the risk management team um with their certificate department, it just allows you to cut out the middle step. So all that just sound perfect and it just seemed like the perfect match for me to get in and be able to serve my clients.
The best was to have Federated support me and be able to do that so long winded answer as to why I chose Federated but that's not why I know and I just want to like highlight a few things that you said. You know, first thing is that you know there's like the saying like well you eat what you cook, you know it's like the thing that you're offering like well you actually utilize it and it's, it's hard to be in integer like in terms of what you're saying and what you feel internally, if you know it's it's hard to, you know, serve some of the highest level if there's a disconnect there.
And so it sounds like for you like there is consistency in that way. And then the second thing which I love common core value that Federated shares with ours is continuous self improvement. The amount of money that is being put into each employee 250 K. That is astronomical. Like and that's that's a beautiful thing because um you know the amount that they're pouring into you that allows you to then pour into the businesses that you work with. And so I think that's incredible right? They have the system, they have these great products and also you are being improved at a very high level.
And then the third thing I just wanted to pull out further was the fact that it's it's like a wholesale right? You're not paying this huge markup by working with a company and they got multiple products and maybe they have a financial incentive to go for this product versus that. And so it sounds like that that really does help. You know when when a business owner is looking at this line item it's not like there's there's not that bloat that's that's on it that might might be coming from from other and when we met at the event they only choose Federated and there's a reason for that and it's because of the product.
So it's it's not necessarily you're listening to a Federated agents sit there and tell you well we've we've got one of the best products around it. No we have these hundreds and hundreds and hundreds of associations and thousands of clients that only recommend Federated and I wanted to be a part of that and I didn't want to be a part of a of a losing team. And quite frankly um it's it's paid off. So that's why I had the opportunity to meet you there and that's why A. C. C. A. I'm extremely grateful and Federated is extremely grateful for everything that they do for us.
And uh it's it's just a match made in heaven. It really is. I love that. And and maybe now we can do is just dive into some of the products or offerings you guys have. You know I know that when we talk to the event there was some interesting things that you're doing with things like tracking the trucks and you know, things like that, could you maybe just like um, what, what are some of the major pieces that would be relevant to an eight track business owner?
Absolutely. So, so first off whether you're with federal currently or whether you're not, I encourage everyone to go out there and reach out to your agent if your agent isn't already reaching out to you about how your market is changing. Um, the best example I can give you is, I'm as you can probably tell by the crab in the background, I'm local to the state of Maryland. So my clients are in the state of Maryland, so you have to be able to overcome and adapt to different challenges that may be occurring for example, um, yesterday or the day before Maryland, just past the process to begin legalizing recreational marijuana.
That's gonna be a big challenge in the workplace, especially for our contractors that have guys driving vehicles all over the place, Maybe don't currently have a drug free program, um, or a drug program in their workplace currently and that opens them up to a lot of liability that needs to be communicated between them and their agent of that about exactly how that's going to be handled. Um, so talk to your agent to kind of hit on what you were talking about, john Federated invest so much into their clients because in turn, if you think about it from an insurance standpoint, you know, we don't necessarily, we're there.
If we have to pay out the claims, that's what you pay insurance for. But it's a win win on both ends when you don't have to. So we pride ourselves and we always tell ourselves our risk management company first and an insurance company second. So we offer hundreds of different products. The one that you're handing on that I talked about with the A. C. C. Event as we give our clients free. It's this program, it's called telematics. It's not anything that's required, but it's something that's very unique and it's essentially a chip that goes in the windshield of the vehicle and it can monitor your drivers and your employees speed, harsh braking, um, harsh turns.
But the biggest thing that it kind of beats everything else in the industry is it allows you to determine if your employees using their phone while operating the vehicle that has your name on the side of the van. That is the scariest thing. Hands down when I'm talking to my clients is this is my company's name on the side of the van. They're probably on the road texting on the phone and they get into a car X and then they hurt kill someone. God forbid that's my name that's out.
So this is just something I always say insurance is to allow our business owners to sleep more peacefully at night. And this is another product that our clients are utilizing to be able to do. So and our clients are doing some fun things with it. Hey, whoever has the best score at the end of two weeks lunch is on me. Whoever has the best score. So it also allows you because a lot of times when I see with my owners and my clients is sometimes they make the mistake of going at their employees.
Only when there's something bad that's happened, how nice would it be to be able to use this to go to your, your employees and say, hey man, great job. You got a 100% score on this past two week rolling period while driving. I really appreciate that. Here's a gift card on me, take you and your significant other kid or so be it out on me. I really appreciate what you're doing. Thank you Again, aside from an insurance standpoint, it's just turning that insurance into an asset for your business and every business owner will tell you what's your biggest asset.
It's, it's your employee hands down. It's your, it's your employee. So I love that. And it's, yeah, I love that idea of gamifying it and not just, you know, like you said, always just find the bad things that are happening, but finding the opportunity to find what they're doing well. You know, things that they can be proud of, things that they can be a role model to some of the other employees on the team and the other leaders. Um And I think that's really cool that that you guys do that and it's not only protecting them but it's protecting the community also that that they're serving right?
You've got someone who's on their phone and you know the hurt or God forbid kill someone like that is that is that would be horrible. And your company's on the name on the truck too. So it's it's like a double whammy. It's 100%. You mentioned earlier. Um that line item on the P. And L. Of your insurance, your insurance cost. Imagine what that number could look like if you didn't have these rich management resources for how much more it could be costing you. You know there's no line item on a financial saying this is how much I had to pay out in a lawsuit because my employee was using a cell phone while operating a vehicle.
So you want to talk about financial growth and financial stability for a business, You can't see how many lives you're saving as an insurance agent or from using risk management resources but guarantee it if you're utilizing them properly, you are saving hundreds if not thousands of lives and then in turn selfishly saving your business money. Yes. And I think that could be something that folks could be interested in. Like um if they were to understand like let's say they want to go to Federated and switch over and um like how would they begin to understand these numbers right?
There is gonna be the numbers that we can see. But then like you said, there's this opportunity, cost of protection of the threat of the things that are happening. So how, how would you typically walk through with someone like, hey, this is kind of what you might be investing, but then this is kind of like really what you're saving, like it's, it's protection for the future. How would you, I guess walk through some of those, those numbers with them. That's a great question. The first thing I always like to do is what's called a loss analysis, looking over maybe their previous claims and exactly how they can be preventable.
Not every single claim is preventable, but there are a lot of claims out there that can be preventable. And then looking at the different things that Federated can do on our end to make it. So those claims either go away or lessen a little bit. The, the biggest thing and the most frustrating thing that I hear from my contractors is often their problem with and confusion unfortunately with workers compensation worker's compensation is huge for contractors and every single contractor is gonna know exactly what I'm talking about here and most usually their skin crawls when they hear it, but it's called an experience modification.
And I'm getting really insurance deep and kind of nerdy right now, but basically to sum it up. It's a multiplier that your state sets the more work comp claims you have, the higher that number is the less work comp claims you have. The lower that number is there are some things that you should talk to your insurance agent, whether that's Federated or your current insurance agent. If your current insurance agent doesn't have an answer for you, I highly encourage you to reach out to either me or your local Federated representative to get answers because they'll be more than happy to help you.
But there's ways that you can take those workers compensation claims and reduce that experience modification simply by just doing a loss analysis eight years what you have right now versus what could happen. And in turn that saves you hundreds of thousands of dollars throughout their to sum it up. Loss analysis is the first thing um The second thing that that that you can do is, and it's, it's very very, very under the surface. It's not surface level at all is how are you treating your current employees?
How's your turnover looking from an employee standpoint? Because we all know the cost to hire and train new employees. It hurts when you lose an employee to a competitor down the street that's offering an extra dollar an hour. And we all know that there's employees out there that do that that hurts because the cost to then turn around and train them. Federated's got plenty of key man policy's key employee policies, Just retention policies and again, not just federal to talk to your current agent if they have anything like that because there are so many different avenues that you can take that I challenge all my business owners to do the extra step to.
Maybe it seems like you're giving the employee more than you necessarily should. But in the long run it ends up saving you way more money and you get way more in return by keeping that employee. So there's so many different avenues that you can take from lost analysis to employ your retention. But it's, it's very important to dive into all those avenues and again, to use your current insurance program insurance agent for more than, oh, I had a car accident, Let me turn this claim in and and get a check back for it of that.
And um, and I guess maybe what are, what are some of the typical things? So you mentioned car insurance, you mentioned about, you know, key employees leaving. Are there some other things that are common claims that have to be made that you know, policies protect someone against that are pretty common in the contracting space you'd say so, especially in the contractor world, at least at least in my area. Um, tools are expensive man tools are crazy expensive right now. And uh, I see a lot of theft with tools that's a big deal.
You want to ask your agent exactly how that's covered but fortunately, I mean we're right around the corner from 2023. A big thing that's happening and impact in the world right now are cyber claims, cyber issues are blowing up right now with stealing your customers information, your client's information and you want to make sure that your insurance program protects you enough for those defense costs for those claims that have to be paid out for the money that you might end up losing because you're dealing with this claim.
And I hear it all the time. Well I use a third party database to keep my clients information. I don't have to worry about it. Do you, do you not have to worry about it? You think you think that client knows that you're using a third party database? You're getting drawn in whether you like it or not and you're gonna have to pay defense costs. So do you want to pay it or do you want to make sure that your program, your insurance program is adequately covering you to make sure that you don't have to worry about it.
So I challenge everyone. Talk to your current agent, make sure it's a program that works specifically for you. Insurance should not be a cookie cutter. One size fits all. It should be specifically tailored to you and your business and building off that too. So we talked earlier about looking at insurance is an asset versus a liability. And I think there's two pieces that also can make it even more of an asset, You know, number one, it's the person that you work with. Um, right. You know, there's of course the direct, you know, working with them on, on their insurance.
And, and then the second thing is, you know, you can use your insurance program potentially to help market yourself as well. So could you speak to those two benefits? Because really I, I think folks can be very one dimensional like this. I'm paying this and I, you know, claims and emergencies, but you're, you're adding someone to your team and you're adding something to your marketing department as well. So I wanna, I wanna die into that as well because it's, it's like these invisible benefits that you, that help you turn something from being a liability to hey, this is really helping us 100%.
So what I see all the time that really separates some of my clients from maybe the other clients is exactly like you said, utilizing that insurance program to market yourself. What I mean by that, we all, we just talked about that employees are the biggest asset for a business. A business owners most important factor to being profitable in their business is having employees and successful employees. And part of that means recruiting, you can use your insurance program to entice individuals to come work for you. What I mean by that, you can put on your website for anyone doing any uh, research on you.
Hey, I'm offering these benefits such as, you know, a life insurance program, a disability program for my employees, um, bonuses for my employees. On top of the traditional, here's your hourly pay. Here's a four oh one K. Here's some health benefits. Not a lot of contractors out there that I see are going that extra step to invest in the extra life disability, but not only that, use your risk management programs to help train your employees. Hey, come work for me. You're, I'm gonna invest more time more money in for you to get better at your craft, to get better at what you're gonna do.
It's ultimately gonna end up making you more money in the long run. If you come to work for me verse, joe Schmo down the street. That does, that makes sense. No. It kind of reminds me of what a friends, another business center talking to me about this myth that no one wants to work and we want to say this directly to people looking people work. But it's like, it's not that no one wants to work is that no one wants to work for you. And so it's, I think the challenge, right?
It's it's like these benefits, their their key, right? You know, people now that, you know, we have flexibility and you travel, you know, living in different places and choosing where we want to work, especially with this new generation of workers man. We got to cover the basics. We have to make the place that they work like they're spending their life there. And these benefits are a great way to attract in addition to like the culture and the opportunities for growth and feeling like their opinion is valued.
But like to your point, it's like you're stacking these, these things that some people just won't offer and they're like, why? Why does no one want to work for me? Well because you, cause you're trying to do with the mayor minimum for them. And that's the hard conversation that you know, we have to have with ourselves. Like really think about, hey, are we doing the best that we can for our employees? And everyone thinks you're the best. It's, it's natural. Everyone thinks that, you know, my business is better than that business.
I have nicer logos on my van than the guy down the street. Um, but I, I challenge every single business owner and in fact I learned this extremely, extremely successful rep in New Jersey. Her name is Leslie concept and I know any contractor that's probably listening to this in New Jersey knows exactly who she is. She did a podcast and I listen to it and it kind of made me realize that hey, I might need to go and challenge my clients a little bit more. She challenges all her clients.
I encourage all of you and I'm gonna challenge you go out there. If you're recruiting and do more than just glass door, you know, get out there, go to colleges, set up a booth, go recruit, put your name out there, be different. Uh, you're only gonna get in, you're only gonna get in return. What you put out if you think just putting out a glass door and saying, hey, this is how much I'm gonna be paying hourly if you come work for me. The person only came to work for you because of the hourly rate.
I guarantee you give it a couple of months, not a year. Someone offers them another dollar. They're gonna go chasing it the same way you wanna go out there. You want to put yourself out there be different and recruit the exact people that, that you want in return, which I know it always sounds so much, it's definitely harder done than said. 100% understand that. So I know all of you are sitting here like, Oh, easy for the insurance agent to say, but I really do. I really do challenge you.
I really do. Yes. And that's, that's it. It's um, it's going that extra step. It's a more competitive market people have choice. This is a, this is a different generation of workers that are emerging demographic shifts. You know, a lot of folks are aging out retiring and you know, the new worker completely different than what was here 50 years ago and everyone wants to work at home and you can't do that as a contractor. So you got to be really, really, really creative and how you attract and retain employees of that.
Um, so I guess in terms of transitioning, you know, we met at an association event and Federated, you work with a lot of different associations. One of the things that I like to to share with folks is the power of the mastermind or the power of surrounding yourself with people who are much further ahead than you who have accomplished things that you want to accomplish. There's just something about being around others who have done that, where it opens up possibilities for you. And so, you know, you having worked with a number of associations as well in a number of them, you know, serving contractors, could you speak to the value of that?
Because I feel like that's, that could be one of the things that could be holding people back, not wanting to go to the event or fly out. You know, I'm already busy in the business. Could you talk to the value of being a member of an association? Yeah, it's easy to make excuses to say, you know, I'm too busy to do this. I'm too busy to do that. Um, something I learned in one of the greatest things that I try and live by is the best things in life on the other side of fear, putting yourself out there.
Um, meeting new people. I wouldn't have had the opportunity to be speaking with you, john right now, if we didn't have the opportunity to network, I always tell people, why not join an association, You're already in so much competition being a contractor. There's so much competition out there. Why not be a part of a group that allows you to feed off of ideas that allows you to have the competitive advantage from the guy down your street. That may not be a part of the association. Everyone inside of association wants each other to grow, wants each other to do better and someone might be doing something that you thought was a really good idea that you had never heard of before, that you would never know if you weren't part of an association.
It's, it's an investment. It's an investment into yourself. It's an investment in your business. I think associations are fantastic and it allows you the opportunity to not have to have the headache of. Well, who do you think is the best for this? Or maybe I should reach out to this person to figure out, you know, who the best supplier is or um, who the best insurance company I'll use as an example for my fit, the association can help you with that. You have hundreds of members that are giving different opinions that you can make a decision off of.
It's only a benefit to you is what I say and it's an investment and it's an investment that's worth it. Yes. And it's just right. People just open up your eyes to things like you said, you never considered that these resources that are out there. Um, and you never know the power of one relationship can, can drastically change someone's life. Um, definitely happens to myself. You meet someone, they're like, wow, I, you know, he's doing that. I could see myself like in him and possibly do that in the future.
It just changes your mindset around around things. Um, Okay. And so before we, because I do want to talk a little bit about mindset and I think we're trending towards that. But before we do anything else with insurance that is important for contractors to consider, um, you know, whether it be challenges opportunities questions to ask their current provider, what are, what are some of the things that we might be missing that we should make sure to share with folks. Uh, I think unfortunately a big aspect to insurance that that's missed a lot that some people may not even know is available through their insurance agent is to start beginning the process of preparing for life after I retire.
You know, what's gonna happen with my business in the future. Do I want employee kids to take over? Do I want to sell my business? Do I do I want to just continue in this business until the day I die. It's extremely important to have a plan and that is also an aspect of insurance business succession, a state planning, making sure that everything is in order. And I encourage you if you haven't already to talk to your current insurance agent to make sure that all that is lined up because unfortunately we all know the statistics.
Second generation businesses 99% of the time fail and the transition from first generation business to second generation business is usually the main reason that those businesses do fail. Nobody started their business again to fail. And a lot of individuals start their business especially to have family in it to want their family to continue to read through awards of what they started. Talk to your insurance agent to be able to make sure that you do have that plan lined up because everyone thinks about the, what am I gonna do with my building burns down or what am I gonna do with my car crashes and I can't get to work or I can't go out to the house and and, and operate.
But nobody seems to think about, okay, what am I gonna do with my business and the next generation, the next step of life. And often times when they do decide to look at it, it's a little too late. So I encourage everyone to get on it sooner rather than later. It's never a fun topic. It's never something that's exciting, but it's something that's extremely, extremely important and I guess just to dig into that. So is I guess in terms of strategizing. So is that like, would you, you mentioned earlier like life insurance policies maybe you, um, I don't know, put it on some of the key key people in the business.
Like what, what are some of the things that someone should be doing as they're planning? Because I know a lot of the business owners I speak with legacy also have family businesses like they have, I'm thinking of one guy right now. Three son and he's looking to hand it down to them. So what are, what are some of the things that they need to put in place? Are they policies, are they like will, like what are its a mixture? It's a mixture of both. So your insurance agent should and the insurance carrier should have a strong partnership with an attorney because we're insurance agents were not attorneys, but for example, Federated, we partner with a state attorneys and business succession attorneys.
That this is all they specialized in all they do in for contractors and you mentioned it perfectly. Every single individuals, situation is unique and different. The contractor that that you bring up. For example that has three kids. Well what if only one kid wants the business and two of those kids don't want the business? How is that fair? I'm gonna give one kid the business, but the two other, what do I give them? There's so many different unique situations and you brought it up. Life insurance can be used as an alley for that.
Um Not to, not to get political by any means whatsoever because we're not gonna do that. But Under the current administration right now, in the future, we could be looking at estate taxes after someone dies north of 40 to 50% after 4-5 million um gap, essentially first 4 to 5 million not being taxed and then anything after that, you're looking at upwards of 40 to 50% state tax. Being able to talk to your insurance agent and their attorney partner to be able to use products such as life insurance to mitigate that tax is huge and it's something that your insurance agent should be talking to you about.
And if they aren't, I really do encourage you to ask them, Wow, I didn't even know that. Wait. So you're saying like there potentially could be this 40-50% estate tax on wealth that you hand down. Um just for right now, right now, the exemption I believe is around three million, I'm sorry. Right now, the exemption is around 4 to 5 million. So the first you don't have to worry about that estate tax, but it's considered and it's projected in the future to be, is to get down to the 2 to 3 million as the only exempt amount and anything after that.
You're looking at 40 to 50% estate taxes. Oh my God, that's ridiculous. You die, right. You know, it's, it's already horrible. Like, all right, let's take another 40 50 off the top. You worked your whole life in this business and now half of it's going to Uncle Sam, wow. That's uh, that's concerning. It's very concerning. That's, that's why I'm not on anything that damn, that's crazy. But like you said, don't own anything. There's avenues that your insurance agent and that their state and business succession attorney can help you do too mitigate that risk.
We'll put it that way. I love that. That's, that's a big value. I definitely folks need a key and on that point because, you know, we, we we start a business for a reason, right? We're here to build a legacy, but also to hand down wealth so that the next generation is set up to be much better. And I know a lot of folks who watch this and a lot of my friends and, you know, we're, we're trying to, we're trying to swing big. So I think a number of folks will be impacted by that.
Yeah, absolutely. It's, uh, do your own research. I mean, it's out there. Don't don't don't don't just listen to me. It's out there. Talk to your insurance agent. Um, but yes, stay up the times your insurance agent should be staying at the times with local to national political aspects from how that may impact your business. And that's a huge one right now with the tax exemption is its projected right now in the future for anything over that 4 to 5 million amount, you're looking at 40 to 50% estate tax, which is insane.
So jeez, thank you, Nick, that's incredible. And, and I guess now transitioning to talking more about mindset, you've worked with a number of contractors and I'm just, I'm just curious like is there anything that you've noticed in terms of mindset for the contractors that seem to, You know, there's like some folks that are stuck at a certain level and it could be a year, it could be five years, it could be 20 years then then you run into these contractors where they're like a rocket ship, right? You know, they just seem to grow and they just think a diff the way I'm curious if you could speak to anything related to mindset and how they look at the world because I think that would be really valuable to, to the people that are listening.
I love this question, I have clients that I walk into and it's the end of the world, every time I walk in and meet with them, everything is going wrong. Every, everything's bad doom and gloom, nobody wants to work for me, I can't get this client, this didn't work out and then I have those clients that no matter how bad it may be, they don't let you know That it's bad and they always have that positive attitude. They always have that mindset that, okay, I may have hit a road bump here, but the next day is gonna be even better.
And those 100% of the time are the clients that are succeeding. I I mentioned this earlier, but my contractors that I work with are the most selfless individuals on in this country. They would rather make sure that their employees and their families have food on their table before they have food on their table. A lot of them forget to take care of themselves and that whether that be because they're trying to grow their business. But in turn, sometimes that that can really defeat an individual and it can defeat a client to the point where they may not want to continue with that industry or with their business.
To answer your question, just have a positive attitude. No matter what's going on, nobody's job is perfect. You know, nobody's gonna have 365 days out of the year, profit or good things happening to them. But don't give up on yourself. Uh, don't be negative around any other individual because that just spreads negativity. Do you want to be around anyone that's negative? No, you want to be around positive people and that's what I try and do with my clients to try and be as positive as possible. Try and make sure that they're as happy as possible.
That and that they're having as, as good of a time as they, as they possibly can. You know, we all have lives outside of work, Nobody lives to work. You work to live, yes. Work to live. I love that. And man, I love that. It's, it's like life's tough enough. It's like why not come at it with, with a positive attitude. Um, you know, you have, especially if you have a team, like you are leading a group of people and you know, things, things will roll down.
So if you feel bad you're passing it down to your team and many times they'll take that, they'll take that home with them and so be a shining light, be shining light with, with positivity of that. So I think we're, we're coming to the close pretty soon. But um, anything else that you want to make sure that you share with contractors, whether it's considering insurance, whether it's considering, um, just like mindset and just making sure they're moving forward, lots of changes, like you said, like in the, in the state of Maryland, right?
You know, the marijuana legalization, there's lots of things that are moving anything else that you want to make sure that folks are aware of? I just want to sum it all up, Just go out there, Whether it's your Federated agent or a different agent go out there and make sure that you're communicating with them. You're on the same page with them about how your industry is changing locally and nationally because I'm telling you if you don't keep up, it'll pass you by and your agent should be an employee for you, just like your accounts should be an employee for you, just like your lawyer should be an employee for you.
Your insurance agent should be doing the same thing that that line item that we mentioned in the beginning that's on a financial that should not be looked at as a liability. It should be looked at as an asset. Your employees are your most important asset, treat your insurance program and your insurance agent like an employee like an asset and make sure that they're keeping up with you on everything that you should be knowledgeable on. Of that. Your insurance. I think just to some like your insurance should be an asset, not a liability or sorry, your insurance should be an asset, not a liability and if it's a liability, it's either, it's a perspective thing or it genuinely is not, it's not, it's not a good match for you.
It may not be a good match for you. Every business is different. Every business is unique and your insurance program should fit your business, Not every insurance company is meant for this for for your industry, not every industry is meant for an insurance company. You gotta find the insurance company that works best for you and the insurance agent that is gonna be the best help for you and your business. Amen to that awesome. Well nick it was so it's such a pleasure having you so much fun.
I love talking mindset, all this stuff and um yeah, so thank you for watching or listening in. Um just as we close, I just want to say that you know the freedom podcast is sponsored by Pollyanna Digital marketing Agency that focuses on H HVAC contractors specifically focusing on SEO and website development. So need any help. Um we got you know free audits are going so feel free to reach out and let us know. But as always thank you for joining us for the podcast. The purpose of this is to help you to build you know the life of your dreams and many times that also comes, comes with that is protecting it.
So this is why I thought that this conversation will be perfect. How do you protect your wealth? How do you protect your business you know in the immediate day but also after you are gone and so we gotta think big gotta think legacy and nick, I appreciate you so much for being here because there's a lot of things that I didn't know and I'm sure a lot of contractors don't know and you're being a big help to that man. So thanks so much appreciate everyone and we will catch you on the next episode.
I take everyone, thank you for joining us for the H Vac Financial Freedom podcast. Follow us on Stream Yard Apple podcast, Spotify, amazon music and check out our main website, www dot h. Vac financial freedom dot com, to find out how you can also achieve financial freedom.