Your Retirement Plan Is Not an Annuity Game: Shootin’ It Straight With Stan

Welcome to Shooting it Straight With Stan. I'm your host Stan The Annuity Man, America's annuity agent, licensed in all 50 states. Today's topic is a good one. Listen up, lean in, get comfortable, and grab a coffee because what we will talk about is your retirement plan is not an annuity game. There are a lot of people in the annuity industry who are just looking for nails, and they're the hammer. They're going to sell one product, they're going to sell it to every single person, they're going to get you to a seminar or in their office, and they're going to sell one product. And they're going to sell the highest commission product, in most cases, not all cases, and there are some great people in the annuity industry. We consider ourselves at The Annuity Man, the thought leader in the space, just because I've done so much edutainment, entertainment, and education, thousands of videos, and published seven books on the topic. You can get those books for free at The Annuity Man. I’ve also written many articles, and been on every show on the planet.

‌Bunt Singles

‌With the demographic tidal wave of 11,000, 12,000, whatever the number is, of people turning age 65 every single day, that is a demographic tidal wave. Those are people who are looking for a lifestyle. They've earned it. They want to do chapter two of their life on their terms. Most people are not looking for market growth. Most people have concluded that they can live off the money or live contractually off the money, peel interest off the money, or set up lifetime income streams with annuities in combination with Social Security, with their money. They're not looking to hit home runs. I always tell people that you go from looking to hit stand-up doubles and slide in triples and home runs to bunt singles. Baseball analogy. When you go to chapter two of your life, your retirement plan should be about bunt singles.

‌It should be about going to the cocktail party and understanding that everyone will say, "Well, you missed out on that one. No, you missed on that one." And you're going to be okay with, "Yep, you're right, but everything's contractual. I know where everything is. I can explain it to a 9-year-old. It's simple. It's a simple plan." Your retirement plan is not an annuity game, and I say that because a lot of agents and advisors, whether they call themselves a fiduciary or not, that's a joke. I will tell you right now that some people have a fiduciary plaque on the wall that are a 180 fiduciary. What's a fiduciary, Stan? Good question.

‌Fiduciaries

‌A fiduciary is someone in the financial business who puts the customer's best interest ahead of theirs. Shouldn't that be everybody? Why is there a needed plaque on the wall? I mean, that's insane. That's like putting a plaque on the wall saying, "I'm a good guy." Well, I don't know. Are you? "Well, look, I got a plaque on there. Plaque says I'm a good guy. Right there, it says that I'm a good guy." The plaque beside it says, "I never lie. Hey, I got a plaque there."

‌Fiduciary, I understand the reason we need those things in place for the industry, the financial industry, because there are some issues. There are always issues, such as commissions and things like that, but I always tell my team, "We listen to people with our ears and mouth in proportion." So, we talk less. We listen more. We tell the truth because my grandfather always said, "If you tell the truth, you don't have to remember anything." So, we tell the truth. But this isn't a game. When we're talking to people about chapter two of their lives, this isn't a game. This is their hard-earned money. This is their life's work. This is what they've scrimped and saved and done without. This is the lump sum that they're worried about. This is a big decision. This is not a game.

‌Ask Hard Questions

‌I was recently in my Las Vegas office, which is the main office for The Annuity Man at this point, and I said that. I started and said, "Hey, I hope everyone's doing well. What are we going to talk about? Well, I'm going to remind you, this is not a game." We're very serious about what we do but don't take ourselves too seriously. But this is not a game. And it shouldn't be a game for you. When you are pitched anything, and let's talk annuities as a whole here. Understand that annuity commissions are built in. They're hidden from the client. Good or bad, you can say what you want; they just are. The simpler the product, the lower the commission. The more complex and long-term the product, the higher the commission. Ask what the commission is. Ask hard questions. Moshe Milevsky, which is arguably between him and Wade Pfau and Michael Finke, do a juggling act of who the smartest annuity people are in the room, and I know I'm leaving somebody out like Tom Hegna.

‌All those people have been on my podcast, Fun With Annuities, and I'm so honored that they chose to share their wisdom with everyone. But Moshe Milevsky said, "Ask hard questions. Ask tough questions." If you don't understand the hypothetical or theoretical where you shouldn't even buy the annuity for that anyway, have them explain it until you understand. And if you never get to the point of understanding it, don't buy it. Don't take anyone's word for it; I'm including The Annuity Man . Take the contractual guarantee's word. Look at the specimen policy. Look at the contractual guarantee. When looking at Single Premium Immediate Annuities, Deferred Income Annuities, Qualified Longevity Annuity Contracts, and Multi-Year Guarantee Annuities, those are contractual guarantee products. There's going to be no changes. Period. But there are some products that have moving parts. You have to fully understand that. This is not a game.

‌Swallow the Food, Not the Pitch

‌If a person has sent you a postcard to a steakhouse that you'd never go to, but they're going to pay for it, which should put a few red flags, and I always say, "Swallow the food, not the sales pitch." And they're pitching one type of product with one company; shouldn't alarm bells go off? Shouldn't you look at that person and say, "This is not a game; this is my retirement. This isn't an annuity game to see how many you can sell. And if you sell enough, you can go on a trip to Bora Bora with your girlfriend, boyfriend, spouse, or whatever else applies. This isn't a game." I hate to be harsh, and I hate to be intense like this, but my managing director often tells me stories about how they get through the team when people book a call. They're horrific stories where the selling agent or advisor, I don't know if it's on purpose or whatever, they're looking at this as a game. They're looking at your money as a game.

‌Annuities Are Commodities

‌Also, understand that the annuity industry frowns upon putting in more than 50% of your investible assets. That does not include house, car or guitar, investible assets, and annuities. Now, can we push that just a bit if there's a good case, maybe to 60%? Yeah, but what the National Association of Insurance Commissioners, suggests is not a law or a rule. It's a suggestion, and they talk to the carriers about this; let's not over-fund annuities. So, if someone says, "Well, how much do you have in your 401(k), sir?"

And you say, "Well, I've got 400,000."

"Well, how much is that of your total portfolio?"

"That's pretty much it."

"Well, let's put it all in annuity."

You know what you say to them? This is not a game. They need to know the rules. Obviously, we want you as a client, but I understand if you want to go to the local office or have your brother-in-law or sister sell annuities, I get all that. Or your frat brother who has pictures of you, and you have to go in and be a client. But annuities are contractual. Annuity policies are contracts. You should shop all annuities for the contractual guarantees only. Why? Because when you do that, you completely turn the products into commodities, which means we can shop all carriers for the highest contractual guarantee for your specific situation, and you know that you've got to go in knowing that quotes change like a gallon of milk. Once carriers reach capacity for your specific age or product that they're putting out there, then they're going to lower the guarantee or pull the product.

‌That's the reason you only look at the contractual guarantees of the policy. If a person is pitching you an annuity, they only show you one, saying, "Hey, we've looked at them all, and this is the best one." The answer to that is, "This is not a game. Show me five other carriers with the same product type." If they can't, then they're not your agent. They're not your advisor. They're on an agenda-driven sales path, and I'm not putting down the industry because every industry has bad apples. Still, the majority of the people in the annuity industry are good people, but you are going to run into it.

‌If you're out there shopping around, you're going to run into the hammer looking for the nail, and you have to say, "This is not a game. This is my retirement. This is what my spouse and I have worked all of our lives for. We take this very seriously. We're going into chapter two of our lives, which is about lifestyle, family, and health and ensuring that we live the way we want. This is not a game. This is not an annuity game." Period.

‌Do You Need an Annuity?

‌Just remember, ask two questions every single time when you're considering annuities, what do you want the money to contractually do? And when do you want those contractual guarantees to start? Always use my acronym PILL to see if you even need an annuity, and if you don't need anything in this PILL that I'm getting ready to tell you, then you don't need an annuity. Principal protection, income for life, legacy and long-term care, and confinement care. If you don't need to contractually, underscore that, underline that, contractually solve for those specific items in the PILL, one or more, then you do not need an annuity. This is not a game. The PILL is not a game. The two questions are not a game. These are contractually guaranteed ways to get to the finish line and know exactly what will happen with no surprises. Wouldn't it be great to go into retirement with no surprises financially?

‌Think about it: if you had guaranteed lifetime income products and annuities, you had CDs and AAA, AAA municipal bonds and treasuries and money markets, and things would never go down. Maybe legacy dividends, stocks, stuff like that, and you had contractual guarantees in place. You had your income floor, which includes Social Security, the best inflation annuity on the planet, a pension if you're so fortunate from your employer, and whatever income floor products you put in in addition to that to make sure money's going to hit your account every single month. That's not a game. That's not an annuity game. That's annuity contractual guarantees.

‌Upfront Bonus

‌Another example of a game is when you're pitched the upfront bonus. "Well, buy this and transfer the money for the upfront bonus." What's the answer? You're right. This is not a game. Tell the person, "You're talking to the wrong person if that's your pitch. This is not a game." I've got to make a T-shirt that says that. Walking through the house, my wife's like, "What? What game?" I'm like, "This is not a game." I just keep repeating it, but I'm passionate about this. I mean, listen, I come from rural North Carolina. My wife comes from rural Nebraska. We came from nothing, just like most of you probably came from nothing. We're not inheritance babies. We didn't get a lot. We didn't get a penny. What are you talking about? And that's okay. Our parents did the best they could. They were fantastic. They tried hard. I get it.

‌But I always tell people, "When you're looking for advisors, maybe look for one that's grown up poor because when you grow up poor, you understand the value of a penny. You understand that you don't want to lose any money." And I think that's probably, and my therapist would probably say, "That's the reason you've gone to the contractual guarantees standpoint, Stan, is because you don't like to lose any money." You're right. I don't like to lose my money, and we definitely don't ever lose your money because all we sell are contractual guarantees.

‌I know what you're saying, Stan. "This is not a game is in the back of my head." Good, good. Because every single time when someone's pitching you something, I want you to think to yourself, "This is not a game. Let me ask hard questions. Let me ask tough questions. Let me understand everything before I decide on this hard-earned money, sweat equity I have right here, this lump sum going into retirement."

‌I encourage you to visit my site, book a call with us, and watch all my videos. I've done thousands of them and will continue to do them as long as I can find the baseball hat to put on. I will keep doing these to edutain you, educate you, entertain you, and also remind you with phrases that, hey, take this seriously. Go into these meetings, hopefully it's with us, but you're in control. It's your money. It's not their money. Nod your head. My name is Stan The Annuity Man. That's Shooting It Straight With Stan. I will 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.