Warren Buffett’s 2 Rules For Annuities: 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. This is the place where I get to rant, go off, close the door, and tell you like it is. I always tell you the truth, but these blogs are where I talk about the topics that I am truly passionate about.

Today’s topic is Warren Buffett’s two rules for annuities.

You are probably thinking, “You mean that Warren Buffett? The guy from Nebraska?”

Yes, that guy. The Oracle of Omaha.

Now, to be clear, these are not actually his two rules for annuities. I am applying his famous investing rules to annuities because they fit perfectly. Everyone knows them.

Rule number one: Never lose money.

Rule number two: Never forget rule number one.

That right there describes The Annuity Man and how we run this company. Everything we do, everything we recommend, the entire growth of this company, is based on that philosophy. We only sell products with contractual guarantees. No hypotheticals. No theoreticals. No unicorns chasing butterflies. None of the sales pitches that seem to dominate the annuity industry.

We never have a client call us and say, “You know what? That MYGA or Immediate Annuity or QLAC or Deferred Income Annuity or Income Rider guarantee; that changed.” No, it did not change. It will not change. It cannot change.

We do not sell anything that is not guaranteed.

Why Guarantees Matter

If you look at Warren Buffett’s career, the man is obviously savvy. He eats the same hamburger every day from the same place. He lives in the same house in Omaha. And he only does things he believes are a sure thing, backed by layers of analysts and research. I do not have a hundred analysts behind me, but I do not need them. The sure thing for us is simple: the contractual guarantees of the policy. The sure thing is choosing strong carriers that can back up the claim. With annuities, you transfer the risk to the life insurance company that issues the product.

You are transferring the risk for the primary four things that make up my acronym PILL, which I created and trademarked.

Principal Protection

Income for Life

Legacy

Long-Term Care

Those are the four reasons annuities exist. That is the pill you swallow if you want what annuities are built for.

What We Will Not Do

If you tell me you want “market growth” or “potential upside,” I am going to stop you right there. We are not going to sell you that. Anyone who tells you they have a product that delivers market growth and principal protection is misleading you. They can guarantee the principal protection. The market growth is hypothetical and theoretical, unicorns chasing butterflies.

Do not buy the dream. Buy the contractual reality.

If Warren Buffett Ever Called Me

If Warren Buffett called me, and honestly, he should, and I should be speaking at his annual meeting, but the invitation has not arrived yet. Let's just say he called me and said:

“Stan, what annuities should I buy?” First, I would say, “Warren, you are a multi-billionaire. You do not need annuities.” But if he insisted, “Stan, I want to buy from you because you are Stan The Annuity Man.” Then we are friends at that point. I can call him Warren. I would tell him the same thing I say to every client: “Warren, we are buying the contractual guarantees. We are not buying hopes and dreams. We are not buying hypothetical scenarios. We are buying exactly what the policy says will happen.” You will know exactly what you are going to get, and your lovely wife will know exactly what she will get when you eventually pass away.

Because that is how annuities should be purchased. Not how they are usually sold, but how they should be purchased.

That is one of the reasons we are the gorilla in the room when it comes to national fixed annuity sales and thought leadership.

Avoid the Seminar Nonsense

We do not get caught up in the seminar nonsense and sales garbage being pushed out there. We do not rely on the hype. We do not pitch dreams. We do not oversell potential. We sell contractual guarantees. Period. So, let us repeat Warren’s rules one more time:

Rule number one: Never lose money.

Rule number two: Never forget rule number one.

That is exactly what we do here at The Annuity Man.

Final Thoughts

Kudos to my friend Warren Buffett, and yes, after talking about him this long, I feel like I know him. I have read his stuff for years. The man is consistent. And his rules apply perfectly to the annuity world. Annuities are contractual guarantees. Never forget that.

This has been Shooting It Straight with Stan. I'm Stan The Annuity Man. See you next time.