Today's topic is a heady one, one that will make you scratch your head a little bit and go, "Man, Stan, I didn't know you were that smart. I didn't know you were that well-read. My goodness." Talking like Thurston Howell III on Gilligan's Island. But today's topic is The Scarlet Letter A does not stand for annuity.
Now people are saying, "Wait a minute, Stan, you don't even know what the Scarlet Letter A is. You just heard it. You don't even know anything about it." Yes, I do. Nathaniel Hawthorne is the author of a book called The Scarlet Letter and the story, as we all know, and if you don't know, I'll tell you. It's about a young lady who got pregnant out of wedlock, was not married, had the baby, and back in the day, I think the 1600s, they put her in the town square, attached a Scarlet Letter A to her for adultery, and she lived a tough life. I'm growing weary of A, the Scarlet Letter A, meaning annuity. It doesn't mean annuity. There's no Scarlet Letter A for annuity. I'm proud to sell contractual guaranteed annuities. I'm proud to sell things that don't fluctuate with markets. I'm proud to enhance people's lifestyles, and I'm also proud to point out that every single American with a Social Security number already owns the best inflation annuity on the planet, and it's called Social Security.
If you're master of the universe, wealth architect advisor says, "Oh, I hate all annuities. I'd never put you in an annuity," they are annuity hypocrites. Period. And they should wear the Scarlet Letter A on their forehead for annuity hypocrite. The same goes for those people on TV that say, "I hate all annuities. I'd never bought an annuity. I'd rather be in the frozen gates of hell." That's a conundrum. In other words, do they really hate annuities? These people say, "Well, we do the best for our clients." So what you're saying is you hate all annuities, and what you're saying is that because you hate all annuities, you advise all of your clients not to take a pension, which is an annuity, and not to take their Social Security payments, which is the best inflation annuity on the planet? Is that really what you're saying?
Advisors out there and for the financial journalists and people on TV and CNBC and Fox Business that don't know a darn thing about annuities, stop. You do not want me reviewing Broadway plays or ballets. You don't, and I don't know anything about them. Why would I do that? Then why would you attach the Scarlet Letter A to anyone that owns an annuity?
First, there are many different types of annuities, so I get irritated when people say, "Well, annuities." Annuities, what do you mean annuities? Like restaurants, like trucks, like coats? Annuities, you can't broad-brush it. "I hate all annuities." You hate restaurants. "You should never own an annuity inside of an IRA." Really? Qualified Longevity Annuity Contracts were designed for use in IRAs. Or for the people who go, "Well, I never would want an annuity. I can manage the money. I don't need the income." Hey, spoiler alert Chester, there are annuities that function like CDs. Those are called MYGAs, Multi-Year Guarantee Annuities. For the people out there that hate annuities and attach the Scarlet Letter A to annuities, do you hate CDs? Do you hate treasuries? Because if you hate MYGAs, Multi-Year Guarantee Annuities, the annuity industry version of a CD, then you have to hate CDs and treasuries without being a hypocrite. See where I'm headed with this? There is no Scarlet Letter A for annuity, and shame on the annuity industry for not educating people that the annuity industry has a monopoly on lifetime income. It is the only product category that will pay as long as you breathe. It's the only product category in which you can buy a personal pension. It's the only product category in which there's no ROI until you die; ROI means return on investment until you die because you're transferring the risk to the annuity company to pay you for as long as you breathe. We can structure it so that the evil annuity company never keeps a penny, even though they're contractually on the hook and obligated to pay as long as you're alive.
I love people who say, "Well, I'd never buy an annuity that's got a Scarlet Letter A because when you die, the annuity company keeps some money," and they stick their chest out like, "I know what I'm talking about." No, you don't. You have no clue what you're talking about. What you're really referring to is a life-only annuity, which is one of 40-plus ways to structure lifetime income, one of 40. All these broad brush strokes of Scarlet Letter A annuity, and I love referencing Nathaniel Hawthorne's book, Scarlet Letter A, about the Puritan life back then where the young lady was branded for having a baby out of wedlock. People today are branded because they are now considering annuities. You might be that person. You might have gone into your master of the universe advisor and said, "You know what? I'm considering a lifetime income stream annuity or a Fixed Rate Annuity to protect the principal." Your advisor goes, "Annuity? What are you talking about?" Or worse, they go, "Oh, why would you want to buy that simplistic pro-customer annuity, pro-consumer annuity with no moving parts and no annual fees?" You can explain this to a nine-year-old, "Why wouldn't you buy my upfront bonus whizz bang unicorns chasing the butterfly annuity?"
There is no Scarlet Letter A in the annuity industry. It's gone on far too long for that. Things changed, and I wrote this in my last newsletter, if you still need to get that, go here and subscribe. The information in my newsletters is gold. Things changed last October when the first MYGAs, Multi-Year Guarantee Annuity, the CD version of annuities, went over 5%. Now, if you're reading this 10 years from now, and the rates are either higher or lower, then disregard that. For the people reading it in the next couple of weeks, that's when it all changed.
That's when people said, "Wait a minute. I heard that all annuities were bad. I heard that there was a Scarlet Letter. I heard that I should never consider one. My advisor said no, but I go to theannuityman.com, and they have over 5% guaranteed for anything three years or more on Multi-Year Guarantee Annuity durations. What's wrong with that, Mr. Advisor? What's wrong with that, Mr. Financial journalist? What's wrong with that master of the universe? What's wrong with that CNBC and Fox business? What's wrong with that when you're telling me that I should get 7 to 8% return on market investments and incur and shoulder risk, but yet this guy with the baseball cap who represents all carriers and is licensed in all 50 states and is America's annuity agent is saying, I can get 5, 5.5% and with no risk? What's wrong with that?" Nothing's wrong with that. There's no Scarlet Letter attached to contractual guarantees. There's no Scarlet Letter for transferring risk. There's no Scarlet Letter for taking your money out of the market and putting in contractual guarantees. There's no Scarlet Letter for writing the markets out, as you've always been told, "Be in it for the long haul." Well, you're 72 or 65 or 50-whatever.
Let me tell you something. I'm 58. There is no long haul, okay? I'm living for the day. I'm living for right now, and I want you to as well. I want you to block out all this Scarlet Letter A nonsense that brands the annuity industry as bad, that brands the annuity industry as complicated, that brands the annuity industry as, "All these annuities are expensive." That's such a darn joke. The majority of annuities don't have any annual fees, no moving parts, and no market attachments. Well, then they counter like, "Well, huh, I'm not talking about these. I'm talking about the missed opportunity. Yeah, I'm talking about that. The missed opportunity, the upside, because I'm a professional dart thrower." There's no Scarlet Letter A for getting your butt kicked in the market unless you want to put it on your forehead. But when you hit chapter two of your life, contractual guarantees have to be a part of what you're doing. You already have it in place with Social Security, the best inflation annuity on the planet. If you're fortunate to have another pension, you already have it in place. That's an annuity.
At this point in my life, I am on a mission to dominate the annuity industry by telling the truth. Still, my mission is to factually squash every single person out there, whether they be advisors or consumers, who say, "I hate all annuities. All annuities are bad. Scarlet Letter A, you should wear Scarlet Letter A for even recommending annuities. Annuities, I'd never do an annuity." Now, let's be clear. Annuities might not be for you. Annuities are not for everyone, but annuities are good. Annuities are contractual. Annuities are transfer of risk products, and annuities do not, will not, and will never in my book have a Scarlet Letter A attached to them. They are a good thing, and I will tell you this right now. I am on a mission to flip this upside down to when people retire from here on in, they're going to think annuity. They're going to think lifetime income stream. They're going to think, transfer of risk, they'll put it in their head. It's going to be a natural occurrence to go, "Well, Martha, we're getting close to that retirement age. We probably need to start looking and shopping for annuities with The Annuity Man. Why? Because we need lifetime income." That's what's going to happen, that's getting ready to happen, and that's what I'm going to make happen. Scarlet Letter A, give me a break. It's a joke, and if you're out there pushing that narrative, I will squash you factually. I'm going to debate you factually. I'm going to factually put the facts out there so that people will not listen to that nonsense.
Annuities can be good. Contractual guarantees are great. Are they for everyone? Absolutely not. But think for yourself and do not be influenced by agenda-driven marketing in the financial services industry. Yes, we would love to have you as a client, but I want you to consider annuities whether you use us or not. They are good. They can work. They can enhance your lifestyle, and they can improve your retirement.
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.