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Pros And Cons Of Annuities: The Bad Chicken Dinner Seminar

Stan Haithcock
July 11, 2024

Hi there, Stan The Annuity Man, America's Annuity Agent, licensed in all 50 states. Today's topic is a good one, very close to my heart, because I hate the Bad Chicken Dinner Seminar sales pitches. So, we will discuss the pros and cons of the Bad Chicken Dinner Seminar sales pitches. You need to know what to look out for, and I hope my mom's reading this because my mom, who's 85 years old and living in St. Augustine, Florida, is a professional plate licker. That's what I call her. She goes to every one of these things. And in Florida, she eats three or four meals a day, or a week, at these bad chicken dinners. Of course, the person doesn't know it's Stan The Annuity Man's mom. They would be like, "Oh." And, of course, she'll call me and tell me about the sales pitch, which is very funny.

The Pros

So, the pros and the benefits of a Bad Chicken Dinner Seminar sales pitch are apparent. Free food. I love free food. My mom lives for free food. I literally think you could give her probably anything. She'll eat the free food. She loves going to these Bad Chicken Dinner Seminars. And the interesting part is that they've turned into going to these top steak houses. Listen, if someone's buying you a free meal at a top steakhouse, like a $50 a plate steakhouse, you got to go, "Wait a minute. How much is that commission? How much are the commissions on this product?" It's a lot.

Pitching One Product

Now, the reason I don't like the Bad Chicken Dinner, Bad Steak Dinner Seminar is that they're typically only pitching one product, and that product is a Fixed Index Annuity. I like Fixed Index Annuities. They're not too good to be true. They're pretty darn good if you understand them for what they do, which is they provide 2 to 4% CD-type returns, and they can deliver efficiently and cost-effectively that Income Rider guarantee for future income needs. But that's not how the sales pitch goes. My mom, St. Augustine, Florida, will call me up, and she goes, "Stan, I was at this seminar, and it sounded good. Why don't you sell me that?"

The Pitch

I was like, "Okay, Mom, tell me what they said." "Well, they said I get a 10% upfront bonus, and I get market returns. Your father and I were never in the stock market because we were too risky, but they said we could get stock market returns, which protects our principal. Also, we could get long-term care for free. We don't even have to get any type of medical tests, Stan. Why haven't you told me about that?"

I'm like, "Mom! Mom! No, it doesn't work like that." Every time she goes to the bad chicken dinner seminar, it's the same call. "A 10 or 12% upfront bonus, and your father and I were never in the market, so..." I'm going insane.

Upfront Bonus

Let's just dissect that pitch by my mom. Mrs. Stan The Annuity Man, no last name. 10% upfront bonus, 12% upfront, whatever the upfront bonus is. She likes that. She likes free money, and of course, everyone's like, "Did you hear that?" And Chester's like, "Did you hear that, Martha? We get 10% free money on that." Come on. Upfront bonuses are candy for the stupid, and don't be stupid. There's no philanthropist at an annuity company giving money away. It's part of the overall contractual guarantee.

Market Upside With No Downside

So, no on that one. Next one: "Your father and I never really did the stock market." I love that one from Mom. Market upside with no downside. Wrong again. Why? Because they're CD, MYGA type products. As my CEO says, "It's a kind of a 2 to 4% return on Index Annuities, which is good." Then, by the way, those gains are locked in on the contract anniversary date, etc. But it's not market upside with no downside. It's not market participation with principal protection. I don't give a rip what someone shows you that, "If you'd done it 10 years ago, you..." Screw that. That's crazy. If you'd have done a hundred sit-ups a day every day for 10 years, you'd have six-pack abs, but you don't. And I don't either.

The point is you can't make your decision on some back-tested number. And in some states, it's illegal to even show that. It should be illegal in all states. And if someone said, "Well if you'd done it then..." get up and walk away. Shut the Zoom call off and put the phone down.

Long-Term Care

The other one is free long-term care. "Stan, it's free your long-term care. Your father and I..." Just stop. It's not long-term care. Long-term care is a health insurance product, and annuities and Fixed Index Annuities are life insurance products. So, long-term care is the best coverage you've ever had, ever. If you have it, keep it. I understand premiums are going up. It's the best coverage you can have. What they're talking about in the Bad Chicken Dinner Seminar is confinement care enhanced benefit type, meaning when you get sicker, you get your money back quicker.

It's not bad; if you can't qualify for traditional long-term care and you're smoking Newports and drinking Jack Daniels every day, it's a guaranteed issue product. But in essence, you're getting your money back quicker when you get sicker. The only true part of the Bad Chicken Dinner Seminar sales pitch is the lifetime income. It's that Income Rider attached to the Index Annuity that can provide a pension income stream for the rest of your life as long as you're breathing. Here's where they mess up, though. They're pitching one product with one company. When looking at Income Riders for lifetime income, you have to shop all carriers. You have to shop all Income Riders for the highest contractual guarantee. Just remember this: if it sounds too good to be true, it is. Every single time, no exceptions, with annuities. I tell my mom all the time, "Go to the Bad Chicken Dinner Seminar, swallow the food, not the sales pitch."

I want you to think about it from another standpoint. Let's just say you go to the Bad Chicken Dinner Seminar or the Really Nice Steak Dinner Seminar. There's a hundred people in the room. That sociopath that's giving the presentation is going to try to sell every single person in that room the same product. That's like going to a medical seminar and the doctor is up front and says, "You know what? I'm going to prescribe the same medicine for everyone in the room." That's insanity. That's also called malpractice. In the annuity industry, it's also called malpractice. It should also be called lose your license. There's no one-size-fits-all for anyone. But unfortunately, that's the Bad Chicken Dinner Seminar circuit. I started saying Bad Chicken Dinner Seminar long ago, and now everyone uses it.

Swallow the Food, Not the Pitch

I'll get a call from the Chesters of the world. "Hey, I just attended a Bad Chicken Dinner Seminar. First of all, it was a really nice steak. I got a filet mignon, a baked potato, and a Caesar salad. I'm going to tell you right now, that filet mignon was delicious." Great, Chester. You swallow the food, swallow the steak, not the sales pitch. I'm not saying don't accept the invite. Accept the invite. Just don't allow them to meet with you afterward. Just get up and walk away. And I guess everyone out there could say, "Well, Stan The Annuity Man's my agent," or "Stan The Annuity Man's my friend," or "Stan The Annuity Man's my son," or Stan The Annuity Man's my cousin." If you just mention the phrase "Stan The Annuity Man" when those people are calling to set the appointment, click. They want no part of it because I will strip away the facts, and I'm the walking middle finger of annuity truth.

This has been a fun topic for me because of this Bad Chicken Dinner Seminar stuff, especially since I live in the Florida area, and oh my gosh, you could eat every single day. Back in the day you could. But if you want to know, the ending to my mom's story is like she's always at the end going, "I really appreciate you explaining it to me. I feel a lot better, and I trust what you say." I'm like, "Okay, Mom, great. I'll see you next Sunday when I come by." She's fine, but she's like a lot of people. She falls for that too good to be true pitch. And my mom inherently trusts everybody. Trust no one. Trust the contract. Annuities are contracts; they're not investments. Don't be bamboozled out there. You're smarter than that.

I hope that this blog prevents somebody out there from falling for that Bad Chicken Dinner sales pitch. And I hope that the agents and advisors who are reading this have that in their lexicon and marketing strategy. Just please stop. I'm going to pound the table until the truth is known about these bad sales practices. Thank you for joining me today. I'll see you next time.

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