GAO (Gov’t Accountability Office) States Delay SS, Add Annuities





Over the past couple months I’ve seen positive annuity articles published by the New York Times, FOX Business, SmartMoney and the Wall Street Journal!
Now add to the list the United States Government Accountability Office (GAO)!!!

On July 1st, Bloomberg News released a story based on the most recent GAO study. It states:


“The risk that retirees will outlive their assets is a growing challenge.” Increased life expectancies and health-care costs coupled with declines in financial markets and home equity over the last few years have “intensified” workers’ concerns about how to manage their savings in retirement. Annuities are insurance contracts that can offer a steady stream of income for life. Middle- income households, defined in the study as having a net worth of about $350,000 including their homes, that don’t have traditional pensions should consider using a portion of their savings to purchase an inflation-adjusted annuity.”

The study also points out:

  • Almost half of those near retirement are predicted to run out of money and won’t be able to cover their basic expenses and uninsured health-care costs.
  • A husband and wife who are both 65 years old have about a 47 percent chance that at least one of them will live until 90, the GAO report said.
  • An immediate annuity can protect retirees from the risk of outliving their savings. For example, a contract purchased for $95,500 by a 66-year-old couple in Florida may provide $4,262 a year until the death of the surviving spouse and include increases for inflation. And
  • Only six percent of workers with a 401(k)-type plan have thus-far opted for an annuity at retirement.

If you want yet another great credibility piece to use with clients, CLICK HERE FOR THE FULL COPY.
When I can help with anything else in your practice, contact me. Make it a great month in July!

Worn Out Presentations [3 Items]

The retirement landscape (and marketing into it) is evolving at breakneck speed. One of the top producers I consult always says “If you’re not evolving, you’re dying.” So ask yourself:

  • Am I currently showing clients materials that are timely and relevant today?
  • Or am I using sales materials that are 12-24 months (or even longer…) old?!?
  • Do my handouts, supporting docs and videos feel a little worn out?

Not after today…

My simplistic role in the retirement landscape is to empower. Empower financial advisors to efficient marketing, additional clients and a larger bottom line. Do all that while putting more American retirees in a safe and secure retirement environment. To support that cause, below are 3 incredible client pieces. All 3 were shared by your financial advisor peer group and are already being used successfully in the field.
Steal at your leisure and refresh your support materials ASAP!

Sales Support Item #1
Barron’s “Best Annuity” Article – June, 2011

This 2 page article provides a fair view of annuities & their value proposition. Given how well-respected Barron’s remains for financial news, this should be an article you immediately put in front of clients & prospects.

Sales Support Item #2
PBS NewsHour Video – Is Your Pension Safe? – June, 2011

9:38 video produced by PBS (non-polarizing to most people) about the 50 state pension crunch. This video lays the groundwork to prompt taking action. Don’t rely on the government, your employer or your state to bail you out. Take responsibility for your own retirement security now!

Sales Support Item #3
Insured Retirement Institute’s 2011 Fact Book – June, 2011

190-page fact book with updated details, stats and trends in retirement income planning! You can never say you’re at a loss for information with this in hand. There is more seminar content, presentation ideas and client letter statistics than you could ever use (embarrassment of riches)!!!

Push strong into this summer and I’m a phone call/email/post away to help with anything.

The Annuity Puzzle

Have you read the “Annuity Puzzle” article from the New York Times on Saturday, June 4th?
If not, post a comment below and I’ll get a copy out! You need to read this if you visit with clients about annuities!!!

It’s high-quality credibility from Richard H. Thaler, Professor of Economics and Behavioral Science at the University of Chicago Booth School of Business. But just as important, this 2-pager speaks to the core of what clients believe. It opens conversation about their beliefs and how they’re not alone. Here’s a couple excerpts:

  • Economists call this the “annuity puzzle.” Using standard assumptions, economists have shown that buyers of annuities are assured more annual income for the rest of their lives compared with people who self-manage their portfolios.
  • So, why don’t more people buy annuities with their 401(k) dollars?…Here’s one part of the answer: Some people think that buying an annuity is in some way a bad deal for their heirs. But that need not be true.
  • It’s is the decision to self-manage your retirement wealth that is the risky one.
  • An annuity can also help people with another important decision: when to retire

Read through these two pages and decide how you can leverage this in your practice. And make it a great week; contact me when I can do more.


5 Strategies for Rising Interest Rates

I recently read a Fidelity “Highlights” series article; providing commentary on the financial environment and strategies for planners and their clients (for a copy, just comment below & I can send it over).
It’s great education on bonds, interest rates and what’s likely to happen when rates rise in the near future. The base commentary on bond concepts, duration risk for interest sensitive bonds, why credit spreads matter and ultimately 5 strategies for managing this risk were all very good!

But considering this came from Fidelity, the last strategy (#5) really caught my eye. Here it was:

Try to Find a Guaranteed Income Stream 

If you have the resources to hold on to an investment until maturity, and you are saving for a goal several years down the road, consider a fixed annuity. Like a CD or bond, a fixed annuity can offer a rate of interest for a set period of years in return for a lump-sum investment. Like a bond, if you hold your annuity to maturity, you shouldn’t have to worry that your principal will be lost as rising rates cause prices to fall. Annuities can also offer the added benefit of tax deferral. So your effective after-tax yield may be higher than interest received from some CDs or bonds—if you plan to utilize the assets in retirement when your tax rate may be lower. This type of security doesn’t come free, of course. Once you sign up, you generally can’t liquidate without a penalty. So, if you may need to turn the investment into cash, or want to reinvest with a different strategy, you should be cautious. Also, since annuities are essentially contracts with an insurance provider, the guarantees are based on the ability of the company to meet its financial obligations, so customers should do their research and choose products from solid companies. You may want to consider converting a portion of your assets into a steady stream of income for life with a fixed income annuity. By staggering your annuity purchases over time, you can ensure you are not subject to one point in the interest rate cycle.

Fidelity isn’t particularly known for their annuity sales. But we can all agree there a lot of bright people there. Even Fidelity can see that as interest rates rise, the caps/rates/value proposition of fixed annuities will also increase. Retired and soon to be retired clients desperately need the two contractual guarantees fixed annuities provide – safety and income. And since you’re reading this blog and in that marketplace, have confidence that your “safe money” products are about to become even stronger!

Strengthen your education on rising interest rates now and reap the benefits soon! (Again, just comment below if you’d like the article).

Make it a successful May. Retirees need your guidance and products now more than ever.

Annuity – Business Tracking Sheet

Annuity – Business Tracking Sheet

How do you track the business you write?

Some producers I consult have very intricate systems to track safe money/annuity premium, life insurance, assets under management, private placements – everything! Their staffs have systematic processes of when to call, who to call and how to take notes every step of the way. It’s a well oiled machine.
And then (believe it or not) other producers I consult have literally nothing to track their pending and issued business! They’ll put pen to paper, send in an application and then call out to check on it only if it’s been an extraordinarily long time or if there’s a problem. And that system…is a problem.

So how do you track pending business?

So today I’m offering everyone access to a business tracking sheet forwarded onto me from a very successful financial advisor. It’s what he currently uses to track each case step-by-step thru the pipeline and then a second tab to total his production (by carrier) for the entire calendar year. If you want access, all you need to do is ask. No strings attached…

The more systematic you become in your business, the better (and more) you can help American retirees in their finances.

Implement and thrive.

Annuity Sales Rise in 2010

Sales of indexed annuities are on the rise…
According to recent poll results, sales of indexed annuities increased 19% from the 4th Quarter, 2009 to 4th Quarter, 2010! $8.3 billion in FIAs sold 4th Quarter, 2010.

Indexed annuities now account for 40% of the fixed annuities that are sold – proving your prospects and clients need safe solutions more than ever before!!

For the complete article from AnnuitySpecs, CLICK HERE.

Make it a successful month in March! Thanks for all you do.


Annuities Cost-Benefit Analysis

Critics complain that annuities have higher costs. Right, higher costs for higher benefits. Mercedes Benz cars have higher costs because they have higher benefits–better chance of surviving a crash. Yet Mercedes perform the same basic function as the least expensive cars–they get you from one point to another. Annuities have higher costs for the same reason–better chance of surviving a crash.

To read the entire “Annuities: A Better Answer Than Social Security” article from AdvisorOneClick Here.

Implement and thrive!!!