034 Annuity Laddering Strategies: How They Actually Work

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welcome to

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fun with annuities with your host me

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stan

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the annuity man america's annuity agent

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can annuities be fun

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can contractual guarantees be fun

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absolutely they can

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find out the brutal facts about

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annuities with no sales pitches or high

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pressure nonsense

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just the brutal and factual annuity

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truth which is all you need to hear

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let's have some fun with annuities and

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let's have that fun

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start right now

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[Music]

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welcome everybody to fun with annuities

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the number one annuity podcast

0:43
in the country your host stan the

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annuity man america's annuity agent

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licensed in all 50 states

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and the number one independent agent in

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the country as well

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um looking forward to today's topic so

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let's just jump right

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into that topic it's about annuity

0:59
laddering strategies and and how they

1:01
actually

1:02
work so let's just kind of dive into

1:05
that

1:06
and talk about because i get a lot of

1:07
calls about laddering

1:09
and the first thing is why would anyone

1:12
ladder so

1:13
if you're familiar with laddering bonds

1:14
or laddering cds

1:17
um those those are your laddering

1:20
maturities you know you have a

1:22
a two-year cd and a three-year cd and a

1:24
four-year cd or if you have bonds you

1:26
can do them the same way

1:28
but the reason people do that is to have

1:30
have things coming

1:32
due at different dates no one can time

1:34
interest rates as we all know

1:37
so there's no reason to even try and

1:38
anyone that says they can time interest

1:40
rates

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um either they're very new in the

1:42
business or they just they're

1:44
they're just lying or they just think

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that uh you know their master of the

1:48
universe nobody

1:49
really knows people ask me all the time

1:51
where interest rates are going boy if i

1:53
knew that you know i wouldn't

1:54
i wouldn't be doing a podcast right

1:57
nobody knows but

1:58
laddering is a great way to utilize

2:02
annuities because there's no perfect

2:05
answers just really bad sales pitches as

2:07
i always say so it really comes down to

2:09
there's two types of laddering

2:11
strategies

2:12
there's laddering for principal

2:14
protection

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okay and then there's laddering for

2:17
lifetime income

2:19
so those are the two primary types that

2:21
we're going to talk about today

2:22
and i do encourage you to go to my site

2:24
at the annuityman.com and schedule a

2:26
call with me because

2:27
all laddering strategies are

2:29
customizable

2:30
okay they're customizable to your

2:33
specific situation

2:34
and i've been to those rodeos now i've

2:36
been doing this for decades so i have

2:38
heard it all seen it all

2:39
and can put together a customized plan

2:41
for you so let's talk about

2:44
um the way that you do principal

2:46
protection laddering for

2:47
for annuities now the two primary types

2:50
of annuities used for this type of

2:52
laddering strategy number one is a

2:54
multi-year guarantee annuity

2:56
nyga multi-year guarantee annuity

2:59
in essence it's the annuity industry's

3:01
version of a cd

3:03
a certificate of deposit don't make it

3:05
any more difficult than that

3:07
that i think the primary difference is

3:09
in a non-ira account

3:11
multi-year guarantee annuity interest

3:13
grows tax deferred whereas with

3:17
a cd and a non-ira account you have to

3:19
pay taxes on the interest if the myga

3:21
or the cd is inside of the ira it

3:23
doesn't matter it's already tax deferred

3:25
you're just getting the guaranteed

3:26
interest rate that's why you're buying

3:27
it

3:28
but the way to to latter multi-year

3:30
guarantee annuities

3:32
is to let's for example someone says

3:34
called the other day and say

3:35
stan i want a ladder my guess i have 300

3:37
000

3:39
non-qualified non-ira what do you

3:41
recommend well

3:42
just looking at yield curve analysis

3:44
which is you know where's the valuation

3:46
uh you know where does it stop and right

3:48
now at the time of this taping

3:51
of five years is kind of the bogey like

3:53
where you need to stop so what we did

3:55
is we bought a hundred thousand dollars

3:56
in a three-year miga

3:58
we bought a hundred thousand dollars and

4:00
a four year my ga

4:01
and then we bought a hundred thousand

4:03
dollars in a five year miga

4:04
so you took the three hundred thousand

4:06
you split it evenly three four and five

4:07
years so

4:08
starting in year three after year three

4:10
you're gonna have money coming due

4:13
and then you know with multi-year

4:15
guarantee annuities you're in full

4:17
control over the asset

4:18
at the end of that term you can either

4:20
take all the money cash it in and go do

4:22
something else with it or

4:23
we can roll it to another multi-year

4:26
guarantee annuity shopping for the

4:27
highest rates at that specific time

4:29
and by the way if you go to my site at

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theannuityman.com

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we have a live list of the best

4:37
miga rates for your specific state and

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the reason i say for your

4:40
specific state is that multi-year

4:43
guarantee annuities

4:44
fixed annuities regardless of the type

4:46
of fixed annuities it's regulated at the

4:48
state

4:49
level all right so each state has

4:52
different approval

4:53
uh processes for these mygas you know

4:55
some states don't have the same mic as

4:57
available as other states so

4:59
you know when you go to my site you pull

5:01
up the the miga feed punch in

5:03
your state then punch in the duration

5:05
you know three or four or five years

5:07
there's actually even a two year right

5:08
now in some states um

5:10
so someone said hey i have four hundred

5:12
thousand dollars what's what's your myga

5:14
ladder probably would be a two

5:15
three four and a five split evenly a

5:17
hundred thousand dollars

5:18
in each so to me that's a really good

5:22
way to

5:23
lock in rates and i know right now at

5:26
the time of this taping

5:27
um it's not jimmy carter interest rates

5:29
that we all want but it's

5:30
it's reality it is what it is um

5:34
so that's the reason i want to keep the

5:35
maturity short with my client base

5:37
hopefully you'll become a client or you

5:38
already are one

5:39
we want to keep those maturities short

5:41
so it's five years in the end right now

5:42
is really my preference

5:44
so there's another way to do principal

5:46
protection my

5:48
fixed rate ladders annuity ladders so

5:50
the first one is multi-year guarantee

5:52
annuities

5:52
these are the annuity industry version

5:54
of a cd that's it's very easy to

5:56
understand

5:57
but i've also come come up with

5:58
something called the mixed fix

6:00
ladder the other product that you can

6:02
use with

6:03
principal protection laddering with

6:04
annuities is an indexed annuity

6:06
now when we do this with index annuities

6:09
we really don't

6:10
use the income writers that attach

6:13
benefit for future income

6:14
when we do mix fix laddering we'll do

6:17
you know one

6:18
migo one index annuity one my go one

6:20
index annuity so

6:21
let me give you an example let's just

6:23
say you had you know four hundred

6:24
thousand dollars

6:26
and you said you know i want to look

6:28
maybe a little bit more than

6:30
than the migas can can offer and i'm

6:32
willing

6:33
to uh to see what the index annuities

6:35
can do knowing that

6:36
index annuities are cd products but you

6:39
know

6:39
when when done right and when the

6:41
returns are kind of in line with

6:43
reality you're going to get just a

6:45
little bit better than cd returns in

6:46
most cases so

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let's look at the same four hundred

6:48
thousand dollar example with a mixed

6:50
fixed

6:50
ladder that would be let's just say you

6:53
did a hundred thousand in a three year

6:55
miga

6:56
fixed rate annuity a hundred thousand

6:57
dollars in a four year myga fixed rate

6:59
annuity

7:00
and then you do a hundred thousand

7:01
dollars in a five-year indexed annuity

7:04
fixed index annuity and then maybe go

7:06
out just a little bit more and do a

7:07
hundred thousand dollars

7:08
in a seven year fixed index annuity

7:11
that's

7:12
that's a i mean that's that's a way to

7:14
do it that i mean you could split them

7:15
you could do

7:16
a lot different than that you can split

7:18
them all up but what i'm trying to show

7:19
you is that

7:20
with both principal protection ladders

7:23
whether you're just using

7:24
mygas alone or you're using a

7:26
combination of multi-year guarantee

7:28
annuities and

7:29
indexed annuities without the writers

7:32
you're going to protect the principal

7:33
and there are no fees by the way

7:35
and people don't know this because index

7:36
annuities are kind of sold

7:38
inappropriately in a lot of cases

7:40
which is unfortunate they're cd products

7:42
and i have nothing against them they

7:43
just need to be

7:44
explained and you have to understand the

7:45
realities not the dream because you're

7:47
going to own the realities

7:48
but i don't recommend just going all

7:52
indexed annuities on the ladder if

7:54
you're going to ladder for principal

7:55
protection

7:56
i would always if you said stan should

7:58
we do like an all

7:59
indexed annuity ladder for principal

8:00
protection or mix fix i'm always going

8:02
to say mix fix because

8:04
the mixture of the myga the multi-year

8:06
guarantee annuity in the index annuity

8:08
works because

8:08
the multi-year guarantee annuity has a

8:11
contractually guaranteed interest rate

8:14
attached to it whereas with the indexed

8:16
annuity

8:17
um we don't know what those returns are

8:19
going to be and it could be zero

8:20
if markets go down you're not gonna lose

8:21
any money with an indexed annuity

8:23
so that's a does those are the principal

8:27
protection

8:28
laddering strategies now let's be honest

8:31
um at the at the time of this tape in

8:33
current interest rates and

8:35
interest rate environment miga ladders

8:38
or mix fixed ladders with index

8:40
annuities and migas i mean

8:42
these are bunt single type strategies

8:44
baseball

8:45
analogy we're not swinging for the

8:47
fences here we're not hitting doubles or

8:49
triples or home runs this

8:51
is pay no annual fees because by the way

8:54
indexed annuities when you don't attach

8:55
the income rider no annual fees

8:57
okay so pay no annual fees protect the

9:01
principal

9:02
you know we would split it amongst

9:03
different companies just to

9:05
just to transfer the risk and split up

9:07
the risk so in a perfect world if you

9:09
said that going back to that four

9:10
hundred thousand dollar

9:11
uh miga ladder and splitting up hundred

9:14
hundred hundred

9:15
hundred four one hundreds it would be

9:17
with four different

9:18
companies obviously we quote all

9:20
companies for the highest contractual

9:21
guarantee because that's what i do you

9:23
own an annuity

9:24
for what it will do not what it might do

9:28
so before we go to the second type of

9:31
of laddering strategy which is um for

9:34
income

9:35
laddering for income let me tell you a

9:37
little bit about

9:38
the site so you can maximize it if you

9:41
go to the annuityman.com

9:42
i would encourage you to sign up to get

9:44
all of my books

9:46
i've written seven of them i'll send

9:47
them to you i've written six owner's

9:49
manuals all

9:50
on these products i'm talking about

9:51
multi-year guarantee annuities indexed

9:52
annuities

9:53
all of the stuff i'll send it to you for

9:55
free i also have

9:57
a youtube channel called stand the

9:58
annuity men that

10:01
300 plus videos very informative easy to

10:04
understand

10:04
short educational videos on all things

10:06
annuity and i would encourage you to if

10:08
you're looking to ladder

10:10
go to the site on the top left hand

10:12
corner i think

10:13
is a place to schedule call you're going

10:15
to get me and you get me for 30 minutes

10:17
and we're going to have a very good

10:18
conversation

10:19
uh one-on-one to put together a

10:21
customized strategy and i'll even tell

10:23
you

10:24
if you do not need an annuity i mean i

10:26
will i'm i'm brutal about that

10:28
um you're going to like my approach

10:29
because it's not salesy it's not pitchy

10:31
it's

10:32
it's okay here's what they do here's the

10:34
benefits and limitations etc

10:35
so you know with that being said let's

10:39
go to the second

10:40
type of laddering strategy that's that

10:43
i think is important and it's laddering

10:45
for income

10:47
now let's go back a little bit and i've

10:49
said this before and if it's repetitive

10:50
i apologize but annuities were put on

10:52
the planet

10:53
in the roman times for a lifetime income

10:54
stream that's the word that the

10:56
the word annuity comes from the word

10:58
latin word annua a

10:59
nua which means annual payment lifetime

11:02
payment

11:03
and what what the romans did back in the

11:05
day

11:06
and it started back in the roman times

11:08
is they created a lifetime

11:09
pension payment for the dutiful roman

11:12
soldiers and their families and to this

11:14
day after hundreds of years of

11:16
you know these type of lifetime income

11:18
products being sold in america the

11:20
single premium immediate annuity

11:21
primarily is the granddaddy of them all

11:24
um you know they still work the same

11:26
it's a transfer risk based on your life

11:28
expectancy or life expectancies of joint

11:30
at the time you take the payment

11:32
interest rates play a secondary role

11:34
now let's let's stop here for a second

11:37
we just talked about

11:38
multi-year guarantee annuity ladders

11:40
principal protection ladders

11:42
mixed fixed ladders principal protection

11:45
ladders

11:45
that's primarily interest rate based

11:48
okay it's not life expectancy-based

11:50
because

11:50
you're not taking a lifetime income but

11:52
when we go to the other laddering type

11:54
which is

11:54
lifetime income laddering all right it's

11:57
life expectancy

11:59
you know it's a transfer of risk i

12:00
always tell people there's no roi

12:02
until you die because you don't know

12:04
what the return on investment is because

12:06
you're transferring the risk to the

12:07
annuity company

12:08
to pay you for the rest of your life so

12:11
let's talk about how just the basics of

12:15
lifetime

12:16
income laddering you can do it a couple

12:18
ways you can ladder

12:20
the start date so in other words let's

12:22
just let's take the three hundred

12:23
thousand dollar

12:24
example and you say okay let's do a

12:27
a lifetime income ladder you could do an

12:30
immediate annuity by

12:31
a hundred thousand dollars an immediate

12:32
annuity starting right now 30 days from

12:34
now

12:35
then you could buy another immediate

12:36
annuity starting in one year and then

12:38
you can buy a deferred income annuity

12:39
which is an immediate annuity

12:41
starting in two years so you have income

12:43
starting now one year and then two year

12:45
but you buy them all at the same time

12:47
and typically we would probably split

12:49
those three

12:50
those three um companies but with

12:53
different companies

12:54
so that's the first way so you're

12:55
laddering the start date

12:57
the other way to do it and i do this a

12:59
lot too because people are always wary

13:01
about is this the right time

13:03
to buy an annuity is this the right time

13:05
to lock in an annuity

13:06
there's no good answers answers just bad

13:08
sales pitches as you

13:10
know so sometimes we'll say okay

13:13
let's let's take the 300 000 example

13:16
and the guy calls up and he's 55 56

13:18
years old or 57 years old and i'll say

13:20
okay

13:20
let's do this let's buy an immediate

13:22
annuity this year

13:23
and the same time next year let's buy

13:25
another immediate annuity and the same

13:26
time next year the

13:28
next year we'll buy another immediate

13:29
annuity now remember just like social

13:31
security which is the best

13:32
annuity on the planet for for inflation

13:35
it's an annuity by the way everyone owns

13:37
an annuity in this country is social

13:38
security

13:40
the older you are the higher the payment

13:41
everyone talks about should i take the

13:43
income at 66 or should i take it at 70

13:45
because at 70

13:46
it's going to be higher why is it higher

13:47
because you're older your life

13:49
expectancy is less which means that the

13:51
payments are fewer which means that the

13:53
payments are higher

13:55
same exact thing with annuity and

13:57
lifetime income stream annuities and by

13:59
the way

14:00
annuities are the only product on the

14:03
planet

14:03
that can provide a lifetime income

14:06
stream period

14:07
it's a monopoly that only the annuity

14:09
industry has and for whatever reason the

14:11
annuity industry doesn't

14:12
doesn't promote that so we've so let's

14:14
go backwards a little bit okay you can

14:16
do

14:16
a ladder laddering for the start date of

14:18
the income stream

14:20
or you can do a ladder uh a purchase

14:22
ladder which is let's

14:23
purchase it over time or you could

14:26
combine both

14:27
you could say okay we're going to buy

14:31
you know the 300 000 example we're gonna

14:33
buy a hundred thousand dollars this year

14:35
a hundred thousand dollars next year and

14:37
a hundred thousand dollars the following

14:38
year

14:38
and then have different start dates you

14:40
could actually push it i had a call the

14:42
other day

14:42
where we bought three like that and we

14:44
had we deferred one for three years one

14:46
for five years one for seven years

14:49
you know with each tranche that we

14:51
bought again it's customizable

14:53
you know i'm gonna ask you the two

14:55
questions which is what do you want the

14:56
money to contractually do and when do

14:58
you want those contractual guarantees to

14:59
start

15:00
i'm also going to in a lifetime income

15:02
ladder

15:03
situation i'm going to ask you about the

15:05
other forms of life of income that

15:07
you're getting whether it's social

15:09
security

15:10
a pension if you're so fortunate from

15:12
your employer

15:13
dividend stocks real estate investments

15:16
you know those type of things that are

15:19
kicking off income that's hitting your

15:21
bank account

15:22
every month or every quarter or every

15:24
year whatever

15:25
and we're going to look at that income

15:26
floor and then

15:28
we're going to make our decision and on

15:31
on how to ladder

15:32
now a lot of times on the laddering it's

15:35
not just like a hundred thousand a

15:36
hundred thousand hundred thousand it

15:38
could be

15:39
hey stan let's reverse engineer the

15:42
quote to solve for a specific

15:44
monthly income amount so let's just say

15:46
you said stan i want 2 500

15:49
to start a month per month i want that

15:51
to start immediately and then i want 2

15:53
500

15:54
a month to start in five years and then

15:56
i want 2 500

15:57
a month to start in seven years but i

15:59
want to buy them all right now

16:01
i want to buy all three of those

16:02
annuities right now we can do that we

16:04
can reverse engineer the quote to find

16:06
the best quote to use as

16:08
little amount of money as humanly

16:09
possible okay

16:11
to solve for that twenty five hundred

16:13
dollars we're going to shop all carriers

16:15
i represent all carriers we're going to

16:16
look at the claims span ability

16:18
you know all the a plus pluses and all

16:20
the ones you love and all the ones you

16:21
know and

16:22
they're all the ones you don't know

16:23
we're going to look at them all and i'm

16:25
going to weigh in on the claims paying

16:26
ability

16:27
of the carriers now i do that with both

16:30
with all annuity purchases run through

16:32
us i mean i take that

16:33
very serious okay very serious i used to

16:37
uh

16:37
work with morgan stanley and ubs and

16:40
payne webber and dean webber witter

16:42
dean witter i said that wrong dean

16:43
witter remember them

16:46
that's how old i am so i've worked for

16:48
those firms before i understand i

16:50
understand bonds i understand

16:52
you know looking at balance sheets and

16:53
things like that so i'm always looking

16:55
at the bond holdings

16:56
the solvency ratios of the of the

16:58
companies as i joked to with a guy the

17:00
other day he called

17:01
he goes well how you know how can you

17:03
spot it and i said well just think of it

17:04
like this

17:05
there are times that i can look at a

17:07
bond uh

17:08
portfolio from an annuity company and i

17:10
can tell when the son-in-law

17:12
is buying the bonds in other words that

17:14
you know grand poobah

17:15
dad owns the firm or is the chairman and

17:18
he hires the son-in-law

17:19
i know that's a joke but i can tell when

17:21
the person's not buying the bonds

17:22
correctly if it's

17:23
if their durations are too far out if

17:25
it's not spread out right

17:26
i can kind of spot that and and i'll

17:28
tell you when you do not need to put

17:30
your money with a carrier

17:32
okay i will tell you that that's my job

17:35
so with all of these ladders you know

17:37
we're going to look at them

17:38
you know first of all you're going to

17:39
answer the question what do you want the

17:41
money to contractually do and when you

17:42
want those contractual guarantees to

17:43
happen

17:44
and if you say hey i need income and i

17:46
need it now or i need income and i need

17:48
it

17:48
you know some next year and some the

17:50
following year whatever

17:52
i'm going to ask you even more

17:53
specifically to drill down okay

17:55
do you want to just quote a lump sum or

17:57
do you really have an idea of the

17:59
amount of money the monthly amount

18:01
amount of money that you want to

18:03
create now the other thing with with

18:06
lifetime

18:07
income laddering strategies understand

18:10
that you can use any type of account

18:12
same thing with the principal protection

18:14
strategy you can use

18:16
non-qualified non-ira accounts

18:17
traditional ira accounts

18:19
roth ira accounts doesn't matter about

18:22
that you can put the annuities inside of

18:24
that it's it's the taxation of the

18:26
income or the interest

18:28
coming out based upon that you know that

18:31
type of qualified or non-qualified or

18:33
roth type account so

18:35
annuities can be placed think of think

18:37
of um

18:39
the roth ira and non-qualified as the

18:41
house think of it as the house

18:43
and inside of that house is the

18:45
furniture and the furniture would be the

18:46
annuity types

18:47
so you can put annuity types inside that

18:50
contractual structure

18:52
it just when you when you finally take

18:53
money out

18:55
if it's a roth ira obviously it's

18:57
tax-free and then a

18:59
traditional ira it's all taxable at

19:01
ordinary income levels etc

19:03
you know obviously i'm not a cpa or a

19:05
tax lawyer but i can help you

19:07
kind of you know navigate where it would

19:10
make

19:10
the most sense should i use ira assets

19:12
for the latter

19:13
or non-ira assets for the latter or roth

19:16
ira assets for the latter that's one of

19:18
the

19:19
the reasons that i encourage you not

19:20
from a salesy standpoint i mean please

19:23
you by this time you should know that

19:24
i'm just really a straight

19:26
shooter brutally factual person out here

19:29
yes i do sell annuities that's how i

19:30
make my living

19:32
but i'm just not that guy i'm not that

19:35
high pressure guy in fact if you ever

19:36
want to speak with me you got to set

19:38
appointment because i respect your time

19:40
i'm just not going to call you out of

19:41
the blue and

19:42
try to pitch you something so that's

19:44
what i would i would recommend you doing

19:45
the other thing i was going to talk to

19:47
you about was with lifetime income

19:49
laddering when we're talking about

19:51
setting that up yes you can set it up on

19:53
just your life or you can set it up with

19:54
you and your spouse

19:56
you can or you and your partner whatever

19:59
we can set that up but understand that

20:01
once you attach a second person to

20:04
that lifetime income stream there is

20:07
going to be a lower payment

20:08
because the insurance company is going

20:10
to have to back up two life expectancies

20:12
not just

20:13
one now for all of the the the husband

20:16
wives wife's husband whatever

20:18
partners out there i would encourage you

20:20
to really consider

20:22
setting up that joint life payment

20:24
meaning that

20:25
you know like for me my example my wife

20:27
i've been married for 32 years

20:30
everything we have is a joint life you

20:32
know in the future with future income

20:33
stream because

20:34
when i die and i guarantee i'll die

20:36
before my wife and you probably will too

20:38
if you're male listen out there that's

20:39
just the evil conspiracy right

20:42
um it's very it's a very good feeling to

20:45
know

20:46
um right now for me that when i pass

20:49
that income stream is going to continue

20:51
uninterrupted and unchanged for my

20:54
wife's life in other words i always

20:55
kid people when she drives past you know

20:57
past the funeral

20:59
from the funeral home past the bank

21:01
she'll just say she'll look at the banks

21:02
yeah i'm going to get the same income

21:04
stream right so i mean

21:06
i think that's important from a

21:07
continuation standpoint yes you're going

21:09
to get a lower amount

21:11
because it's joint life but i just think

21:13
it's i think

21:14
from a married standpoint it's the right

21:16
thing to do unless

21:18
you know you're age 70 you married

21:20
someone age 40

21:22
even then i'm going to ask you do you

21:23
want to do that but remember it's about

21:25
life expectancy at the time you take the

21:28
payment

21:29
so you know that's another thing you

21:31
just kind of keep in your mind let's

21:32
also talk about with lifetime income

21:35
let's talk about inflation now

21:39
there are agents and advisors that will

21:41
tell you that they have the annuity that

21:42
will adjust

21:43
with inflation i'm just telling you

21:45
nothing against them

21:46
i know they're hoping and dreaming that

21:48
it's true but it's not true

21:50
when annuity companies attach when you

21:52
can attach a cost of living increase

21:55
to the policy or some indexed annuities

21:57
increase

21:58
the income riders uh payments

22:01
they annuity companies have the big

22:03
buildings for a reason they sponsor the

22:05
sports stadiums for a reason they have

22:06
the big logos on the planes for a reason

22:08
they don't give anything away

22:09
so just visually for the people

22:10
listening on the on the podcast what i'm

22:12
doing is i'm holding

22:14
one hand higher than the other hand and

22:16
in essence i'm saying

22:17
the higher the higher of the two hands

22:19
is the annuity

22:21
lifetime income stream annuity that does

22:23
not have a cost of living adjustment

22:24
increase

22:25
and the hand that's lower than that

22:27
significantly is the one that does have

22:29
the increase

22:30
bottom line is is the annuity companies

22:32
don't give that away

22:34
you already own the best inflation

22:36
annuity on the planet

22:37
which is social security and i saw a

22:40
grid

22:41
today from a friend of mine dennis

22:42
miller who writes is a very good

22:44
uh writer about retirement and he was

22:46
just showing the the

22:47
the minor increases and sometimes no

22:50
increases over the last 10 years

22:52
it's not that great of an inflation

22:53
annuity but it's the best one out there

22:55
because

22:56
payments aren't lowered payments

22:59
increase

23:00
based upon the whims of of congress and

23:03
then voting

23:03
for the increase and helping out the

23:06
voters so um

23:09
you know would i like to have the

23:11
perfect annuity that increased with

23:13
inflation yeah but let's talk a little

23:14
bit more about inflation and the

23:16
laddering with

23:17
the lifetime income products and when

23:20
we're talking about lifetime income

23:21
products we're talking about

23:23
the the annuitized products like single

23:25
premium immediate annuities deferred

23:27
income annuities

23:28
qualified longevity annuity contracts

23:31
income riders

23:32
all four of those i've written owner's

23:33
manuals on all four of those i've done

23:35
zillions of videos on and you know those

23:38
are the the type of when we have the

23:39
conversation 101

23:41
i'm going to determine which one fits

23:43
and we're going to quote all carriers to

23:45
see what

23:45
which one provides the highest

23:46
contractual guarantee but getting back

23:48
to

23:49
the thought about inflation

23:53
i think the best way to address

23:54
inflation there's two ways with

23:56
annuities is the laddering of the start

23:58
of the income start date

24:00
so having income started a future date

24:02
like for instance a qualified longevity

24:04
annuity contract

24:05
can be used with ira assets and you can

24:07
start income say at 75 or 80 or 85

24:11
and that's a good way to address

24:13
inflation but the other way

24:15
which is the really the most efficient

24:16
without guessing

24:18
is people say well what happens if

24:20
inflation if

24:22
you know we buy this static annuity and

24:23
it's going to be the payment's going to

24:25
be the same

24:26
every single time and we're choosing the

24:28
highest contractual guarantee

24:29
what happens is hyper hyperinflation

24:32
hits

24:32
what happens there um in my perfect

24:35
world

24:36
then we go by an immediate annuity at

24:39
that specific time

24:40
solving for the specific increase of

24:43
your income floor that you need give you

24:46
an example let's just say

24:48
we set up an income floor and all in

24:50
your social security pension your

24:51
dividend stocks

24:52
you're getting like five thousand

24:53
dollars a month let's just say that and

24:55
let's say

24:56
hyperinflation hits and it's now

24:59
fifty five hundred dollars a month for

25:01
that that you need to live the lifestyle

25:03
that you've earned and worked hard for

25:04
okay then i think at that time we go in

25:08
and we

25:09
buy the immediate annuity reverse

25:11
engineering solving for the five hundred

25:12
dollars

25:14
that's the best way to do it okay when

25:16
it comes to

25:18
um setting up you know addressing

25:21
inflation because inflation's the

25:23
gorilla in the room and nobody knows

25:25
when it's going to happen

25:26
you know there's arguments i've read

25:28
something the other day where there's an

25:30
argument for deflation

25:31
who knows the point is with an immediate

25:34
annuity at the time we need the income

25:36
to address inflation

25:37
we can buy it right then at that

25:39
specific time remembering that

25:41
life expectancy drives the train okay um

25:45
at the time you take the payment if it's

25:47
life expectancy is a dual life

25:48
interest rates play a secondary roll yes

25:51
if the 10-year treasury was at three or

25:53
four percent

25:53
you know it would bump the income a

25:55
little bit but i don't think we're going

25:56
to see that for a long long time

25:58
now one more thing about the lifetime

26:00
income and by the way

26:01
going backwards a little bit the fixed

26:04
rate

26:05
ladders the principal protection ladders

26:06
with multi-year guarantee annuities

26:09
by themselves or multi-year guarantee

26:10
annuities with with indexed annuities

26:13
those are really easy to put together

26:15
because it's really basic is guaranteed

26:17
interest rates as principal protection

26:19
you know we shop all carriers those are

26:21
easy bunt singles that

26:22
that we can do okay but when it comes to

26:25
lifetime income

26:26
there's so many ways to structure the

26:29
policy one of the

26:30
biggest misconceptions about lifetime

26:31
income with annuities i get these calls

26:33
all the time people say well i'd never

26:35
buy an annuity stand because when the

26:37
when i die the annuity company keeps the

26:38
money uh i'd never buy a lifetime income

26:41
stream because of that well that's one

26:43
of about 40 ways to structure it

26:46
most of the time unless you tell me

26:48
otherwise that you don't want to leave

26:49
any money to anybody you have no one to

26:51
leave it to

26:52
we're going to structure so that the

26:53
lifetime income transfer risk is in

26:55
place

26:56
but when you die when your leader jet

26:58
hits the mountain when your ferrari hits

27:00
the tree when the second spouse dies

27:02
whatever money is in that account will

27:04
go to the list of beneficiaries of the

27:06
policy because why because you worked

27:07
hard for it

27:08
i mean you've laid it on the line you've

27:11
saved you scrimped you've checked the

27:12
boxes you've planned

27:14
and you still want the lifetime income

27:16
you still want them to be the annuity

27:18
come to be on the hook to pay for the

27:19
rest of your life

27:20
but we will structure it so that uh 100

27:23
of any unused money will go to the

27:25
beneficiaries even though the annuity

27:26
companies on the hook to pay

27:28
one more thing i'm going to throw at you

27:29
and i'm throwing a lot at you and this

27:31
should drive you

27:32
to setting the time to speak with me

27:34
one-on-one because it's

27:35
it can get a little complex but i am a

27:38
simplifier i will simplify it for you

27:40
but remember too immediate annuities or

27:43
deferred income annuities

27:45
those can be structured also to pay for

27:46
a specific period of time

27:48
not just for life so for instance you

27:51
could say i want an immediate annuity

27:52
that just pays for 20 years

27:54
or i want an immediate annuity that just

27:56
pays for 15 years or i want to buy a

27:58
deferred income annuity

27:59
and income start three years from now

28:01
and only pay for 20 years

28:03
you can do that and we can quote that so

28:06
you have to be saying wait a minute so

28:07
when would i do that there are specific

28:09
situations and when we discuss

28:11
your specific situation it might make

28:13
sense to do

28:14
a period certain annuity instead of a

28:17
lifetime income stream annuity because

28:18
you might have

28:20
a gap of time that needs to be filled

28:22
like you might say stan

28:24
if i can just fill this gap for 11 years

28:26
then i have something kicking in

28:28
in 11 years that i won't need that

28:30
income stream because it will be

28:31
replaced

28:33
make i see that all the time so what i'm

28:35
telling you is

28:36
the lifetime income let's just kind of

28:38
do a wrap up

28:39
multi uh there's two types of ladders

28:41
with annuities primarily in my world

28:44
principal protection ladders using

28:45
multi-year guarantee annuities remember

28:47
those are cd type annuities

28:49
and then we can also do a combination of

28:50
multi-year guarantee

28:52
guarantee annuities and indexed

28:53
annuities which is what i call a mix

28:55
fixed ladder that's for principal

28:57
protection lifetime income

28:59
you can ladder the start date meaning

29:01
you can buy three annuities at the same

29:03
time

29:03
and then lat and and then have different

29:05
income start dates like

29:07
defer for three defer for five defer for

29:09
seven years

29:10
or you could ladder the purchase date in

29:13
other words you could say stan i want a

29:14
lifetime income stream but let's just

29:15
buy

29:16
three immediate annuities over the next

29:18
three years so one this year one next

29:19
year one the following year

29:21
or you can combine the two you can

29:24
combine the you know

29:25
the purchase date um and the start date

29:28
i mean there's just unlimited

29:31
uh strategies that we can put together

29:33
for you but i hope i haven't confused

29:35
things

29:36
um you know you are listening to the

29:38
number one annuity podcast on the planet

29:40
in you know on the annuity fund cam and

29:42
the uh

29:43
will do not might do studios um you know

29:46
we do have a lot of fun with this but at

29:48
the end of the day

29:49
you know we do have to put a customized

29:51
plan together for you and i look forward

29:53
to that conversation

29:54
i do encourage you to go to the

29:56
annuityman.com which is my site

29:59
no one's ever going to call you randomly

30:01
you know we it's an informational site

30:03
you can listen to these podcast replays

30:04
watch the videos read my blogs

30:07
you know read on i'm in a lot of media

30:09
that we put that up there when people

30:11
interview me and things like that

30:12
and then you can use our calculators you

30:14
don't even have to talk to me if you

30:15
want to kick the tires

30:16
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30:17
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30:19
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30:21
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30:22
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30:24
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30:25
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30:28
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30:30
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30:30
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30:32
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30:34
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30:35
ladder and then call me up and say i've

30:37
done it stan this is what i want

30:39
you know and then we'll take care of the

30:40
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30:42
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30:44
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30:47
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30:49
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30:50
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30:52
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30:54
environment i'll leave you with this you

30:56
know we're very proud of what we do here

30:58
and i'm very serious about you know kind

31:01
of changing the game

31:02
in the annuity industry to be all about

31:05
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31:07
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31:08
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31:10
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31:12
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31:13
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31:16
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31:17
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31:19
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31:21
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31:22
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31:24
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31:26
enough to contact

31:27
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31:29
call with me

31:30
stan the annuity man thanks again for

31:32
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31:34
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31:35
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31:38
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31:43
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31:52
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31:52
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31:56
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31:57
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31:59
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32:00
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32:02
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32:03
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32:05
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32:08
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32:11
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32:14
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32:16
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32:17
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32:19
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32:20
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