All Annuities Are…: Shootin' It Straight With Stan
Welcome to Shooting It Straight With Stan. I am your host, Stan The Annuity Man, America's annuity agent, licensed in all 50 states. Today's topic is a great one, and you probably saw it and went, "I'm going to have to listen to this one because I want to see what he's going to say." And the topic is "All Annuities Are..." I'm going to give credit to this topic to a good friend of mine. His name is John Olsen, and he's a treasure to the annuity industry. He's retired, but he's a thought leader and on the Mount Annuity Rushmore and Mount Annuitymore. Hopefully, I'll be there too. But his face is for sure up there because he is just an honest, smart man that helped the annuity industry, and it's a shame he retired, but I wish him nothing but the best.
All Annuities Are...Bad?
What he's always said to me, and what drives him crazy, is when people say all annuities are. It's like saying all restaurants are bad or all restaurants are expensive. It's dumb; all stocks are bad, and all bonds are bad. You can't do that. But for whatever reason, in the annuity space, it's easy for people to say all annuities, the people on TV, the talking heads that want your money to manage, etc. All annuities are bad. Really? Do you mean Social Security, the best inflation annuity, is bad? Do you mean the pension from the government, the state, the labor union, or the 9% of the companies that offer them are bad, that annuity? Do you mean Multi-Year Guarantee Annuities that are Fixed Rate Annuities that give an interest rate are bad? Do you mean lifetime income annuities that pay for as long as you're breathing are bad?
So, all annuities are bad. Wrong! How about all annuities are expensive? It could be one of the dumber statements of all time because most annuity types have no expenses. Single Premium Immediate Annuities, Deferred Income Annuities, Qualified Longevity Annuity Contracts, Multi-Year Guarantee Annuities, and even Index Annuities when you don't attach Income Riders don't have any fees. They are not expensive. So, when you say all annuities are expensive, dumb, stupid. All annuities are bad, no, dumb, stupid. All annuities should not be purchased with IRA money.
Dumb as a box of hair and a box of hammers combined because the IRS and the Department of the Treasury introduced Qualified Longevity Annuity Contracts for use with IRA assets with IRA money. So that's done. If anyone at the cocktail party or your advisor says, "All annuities are a bad deal." I've heard that one. Bad deal? So, are contractual guarantees a bad deal? Life expectancy products, as long as you're breathing, are a bad deal? Legacy products or transfer risk products for the family are a bad deal? All annuities are a bad deal. How's that possible? It's not possible. My legacy out here, when my Learjet hits a mountain that I've rented from a friend, and I do have a friend with a Learjet, by the way. That's the reason. It's like having a friend with a boat. You don't have a boat. You have a friend with a boat. I have a friend with a Learjet. When my Learjet hits the mountain and he's flying, which means I shouldn't have been flying with him because he is my friend, and he has a Learjet. But when that happens, there are things in place with my family that are contractual, fantastic, and transfer of risk.
All Annuities Are Not for Everyone
All annuities are not for everyone. How about that? All annuities are contractual. Yes, all annuities are and should be shopped with all carriers for the highest contractual guarantee for your specific situation that you're trying to solve for. All annuities are issued by life insurance companies. Yes. Do you see where I'm going? So, you're going to hear the all annuities are mantra on the CNBCs or the Foxs or the money managers that want to just charge a fee, etc. These people are making fools out of themselves. And my mission out here is to point that out and to have them stop. It's like saying all stocks are bad. All blockchains are bad. No, you can't do the all in front of it.
John Olsen's, right. All annuities are... Huh? What are you saying? If it's all annuities and whatever happens after that are is a negative comment, that's garbage. Many types of annuities solve for principal protection, income for life, legacy, and long-term care. They're transfer of risk products. They solve for longevity risk outliving your money.
How about this one? All annuities are good, suitable, and appropriate if we have a full conversation to see if they fit your needs. All annuities are contractual and should be purchased for their contractual guarantees.
I'm not getting mad anymore. I'm just going to start pointing things out. I'm going to keep doing blogs and videos with millions of views. You guys are fantastic, and I appreciate you tuning in because I have fun with this. I am passionate about what I do and want you to have contractual guarantees. But if annuities don't fit with your goals, then you shouldn't buy one, even though you own one, social security, but all annuities are good. All annuities are contracts. All annuities are suitable if we have the conversation determining that it's suitable for your situation.
But all annuities are not 100% owned by everybody. How about that? Even though you already own one. So, this blog was to point out the hypocrisy out there, and you're going to hear, especially this happens to me a lot. People will call me, they'll set an appointment, we'll talk, great conversation. We'll do a contractually guaranteed recommendation, and they'll say, "Well, I'm going to show it to my advisor." Okay, great. 90% of the time, that advisor will do an all annuities are negative after it to shoot it down. They don't want to lose the money. I get that. They don't want the money transferring. I get that. And they want to continue to charge a fee for that management of the money. I get that. I understand that, but I'd rather them tell you, "Hey, I really don't want this money to leave. I'd rather manage it. I think I can do a good job, etc." Instead of lying about the annuity category.
All Annuities Are Contracts
Just remember this. I think if we just do one, all annuities are... That's it. And here's the one, okay. All annuities, regardless of time, all annuities are contracts. All annuities are contractually guaranteed. The question after that is, do you need those contractual guarantees? That's it. All annuities are contracts. You're going to receive a policy in the mail from the issuing life insurance company that issued the annuity. It's a policy. It's a contract. All annuities are contracts. You're going to get a contract. It's a contract between you and the life insurance company that issued the annuity. All annuities are contracts. The question is, do you need contractual guarantees? And that's what we want to talk to you about. You might not, and we're okay telling you that. My name is Stan The Annuity Man. Thanks for joining me. See you next time.
Never forget to live in reality, not the dream, with annuities and contractual guarantees! You can use our calculators, get all six of my books for free, and most importantly book a call with me so we can discuss what works best for your specific situation.