036 Annuities vs. The Stock Market: The Brutal Truth About Both

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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 find out the brutal

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facts about annuities

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with no sales pitches or high pressure

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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 to fun with annuities the number

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one annuity podcast

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on the planet i'm your host stan the

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annuity man america's annuity agent

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licensed in all 50 states including the

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beautiful one you're sitting in

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i want to welcome all of the podcast

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listeners

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on all major uh platforms hello out

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there

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and welcome also to the people that are

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watching the

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video replay of this podcast on the fun

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with annuities youtube channel yes i

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have a fun with annuities youtube

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channel i also have a stan the annuity

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man

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youtube channel as well let's jump into

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the topic today because it's a good one

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we're talking about annuities and the

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stock market and the brutal truth about

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both of them now

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um i do have the right

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and the pedigree to talk about both the

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stock market

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and annuities i mean i'm the top an

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independent annuity agent in the country

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i pretty much represent all

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carriers and all product types etc will

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go over that the only one that i do not

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sell

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variable annuities but i'll explain why

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later but the bottom line with that one

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is this i just only sell fixed

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products and guarantee contractually

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guaranteed strategies

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but from the stock market standpoint

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i've been i've been there too in fact i

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started in the financial services

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business with a company called dean

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witter

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you might remember dean witter they were

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owned for a time by

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sears and uh worked for them and then

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morgan stanley who's still around they

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bought dean witter

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and so i worked with morgan stanley for

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a while worked in new york

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for for just a a cup of coffee and ended

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up

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basing myself out of some florida

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offices but then i went to payne weber

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remember payne weber the old jimmy car

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not jimmy carter but uh um what was the

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tennis player's name forget his name but

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anyway

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they would have these big payne weber

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commercials but payne weber was then

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uh purchased by ubs union bank of

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switzerland so i worked for them for a

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while so

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i've been there done that with the stock

2:35
market stuff

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and anyone who's spent a lot of time on

2:38
wall street and doing that

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understands that game uh the way that

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um jimmy connors let me i regress jimmy

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connors was the tennis player for paint

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well remember that okay never mind

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so we're back to talking about the stock

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market

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um to me the stock market is like

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surfing beside a cruise ship um you are

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going to catch a wave here and there

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but you might get sucked under the boat

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as well now when i first got in the

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business in the stock market to

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side um you know there was no do not

3:13
call list there was barely internet

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i mean i remember back in the day

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we all there wasn't computers on every

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desk that's how old i am

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okay um but you know back then you

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called people you built positions in

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specific stocks etc that was way before

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the rap fee that was way before all of

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that that was even

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you know as mutual funds were getting

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popular i was i'm that old i've been

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doing this for a very very long time so

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but back then it really wasn't about

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computer training it was more

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fundamental analysis you kind of looked

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at

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um the pe ratios and what the company

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did and the management team and i guess

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you kind of do that to a point now but

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it's

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you know back then things didn't move

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fast and i always tell people

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when they ask about the stock market

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back in the day when i used to work

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there and for you know morgan stanley

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dean witter payne webber ubs

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you know market moves over a year

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today it happens in a day i mean it's

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that volatile now

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a lot of the reason is what i call um

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computers fighting against computers

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when i left and became the mythic stan

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the annuity man

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um i believe eight you know 70 plus

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percent of all trades were

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algorithmic black box high velocity

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non-human

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trades it was computer driven trades and

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i believe i read a story the other day i

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think it's up to 85 percent so

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i need you to think about that for a

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second 85

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of all trades are done by

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non-humans done by um

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high velocity black box computer

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algorithmic

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automated systems i'm not saying that's

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good or bad i'm just saying that's

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different

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and the fact that you know us peon

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public people are allowed in

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you know from 9 30 to 4 to trade you

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know these institutions and this an

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institutional market

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they're trading 24 7. i mean there's

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i'm not saying you you don't have you

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shouldn't be there in fact i'm going to

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tell you this

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you have to be there and it's the

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opposite for the annuities now i'm

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staying the annuity man i sell annuities

5:18
okay but you don't have to have an

5:20
annuity in my opinion

5:22
you kind of have to be in the markets

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especially if you're young or if you

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have a long life expectancy

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i know that sounds crazy i know the

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annuity gods are looking down upon me

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going stan what are you doing what are

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you doing

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i'm telling the truth it's brutal it's

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the truth

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but let's talk about the markets i mean

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the markets are you're shouldering all

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the risk

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i mean there's no guarantees in the

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stock market but

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with that being said that is the only

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place to get true market returns i

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always tell people if you want market

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returns

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never ever ever buy an annuity of any

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type now

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my my variable annuity friends out there

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that sell variable annuities those are

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mutual funds and the industry calls them

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separate accounts but they're mutual

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funds

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that are inside of kind of an insurance

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wrapper for tax deferred growth

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yes those can get you market growth

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because they're mutual funds

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but you're limited to the choices of the

6:18
specific variable annuity that you're in

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whether it's a

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load variable annuity which has a really

6:23
high fees or a no load variable

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you're limited and in my opinion stand

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the annuity man america's annuity agent

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having been on wall street having

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managed lots lots of money

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and my two very good friends who are my

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partners

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in the business are still managing money

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at a very very high level a lot of that

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money i raised

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for them but they're they're good at

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what they do

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but they're not geniuses so you know

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stock market stuff

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um you kind of need to be there with

6:51
with a part of your portfolio obviously

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as you get older you want to lessen the

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risk you want to transfer risk to

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annuity type products with guarantees

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but you always have to shoulder risk and

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it really doesn't come down to

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to age or demographics or male female it

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comes down to how much risk are you

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willing to shoulder

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and how much risk are you will are you

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wanting to transfer

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everybody's different everybody always

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talks to me hey hey stan the annuity man

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should

7:19
how much money should i put you know in

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annuities and my

7:23
ques my answer that is i'm not sure you

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need an annuity let's let's find out

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first if you need an annuity but for the

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stock market

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you know you have unlimited choices it

7:32
isn't guaranteed and that's fine

7:34
um but you kind of have to be there with

7:37
some of your assets you need

7:38
growth give you an example guy called in

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the other day and he's 60 years old he

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just retired

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we're setting up a lifetime income

7:46
stream for him for his income floor

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but the question he had to me is you

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know i really he was really kind of

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perplexed about should he keep keep his

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money in the market or shouldn't he

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should he or shouldn't he and i said

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look at like this you're 60 years old

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you have at least 25 years of projected

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life expectancy that's a long time

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and it's a long time to be locking your

8:05
money up so

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you kind of need to be in the markets

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now you can do a broad-based

8:10
approach to that you can have someone

8:12
manage your money for a fee

8:13
you know what i would recommend out

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there there's some very good fee

8:16
only planners not not fee based

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fee-based means they can sell product

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and charge a fee they can double dip i'm

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not saying that's bad

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but you know if you're out there i would

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want someone on my side of the table

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managing the money and those

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are fee only planners i know some really

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good ones out there

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if you want me to tell you their names

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and you can interview them etc

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but fee only planners you know just

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charge a fee and they manage the asset

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so you know you can either manage it

8:42
yourself or you can have some once

8:45
someone else manage it but you're you

8:47
have to kind of be there

8:48
i mean period so you know

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what's changed since i was first with

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dean witter you know wearing the short

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sleeve dress shirt and a really bad tie

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and just cold calling people for stocks

9:00
back in the day

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i mean i don't even think that's done

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anymore for goodness sakes

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um but what's changed are the

9:07
institutions

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really you know the hedge funds the

9:10
private equity

9:12
the globalness the 24 7 nature of the

9:15
markets the fact that

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you know things are trading at high

9:18
speed and the computers are now

9:20
involved which is to me is a little

9:23
scary there's been some movies on on

9:24
this

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so you know kind of apocalyptic well

9:27
what happens when the computers just

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drive it down

9:29
we've seen those type of events with um

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you know you know flash you know flash

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crashes where it drops 500

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points like that but

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you know i'm a big fan of the stock

9:41
market i just don't do that anymore i do

9:43
contractual guarantees

9:45
there is a demographic tidal wave which

9:47
i mentioned in previous podcast what

9:50
there's 10

9:50
i believe there's 10 000 baby boomers

9:54
that reach the age of 65 every single

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day

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what that means is they're getting to

9:59
chapter two of their life which means

10:01
that they might not want as much risk

10:03
they might want to

10:04
transfer the risk instead of shouldering

10:05
risk that's not everybody

10:07
it all comes down to the personal

10:08
preference and in your risk tolerance

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but you know the stock market is what it

10:14
is

10:14
and you kind of have to be there in in

10:16
it is unpredictable and it is scary and

10:18
it is volatile

10:20
um but it's one of those things where if

10:22
you have some life expectancy

10:24
um you either have to manage it yourself

10:26
or have someone manage it for you

10:28
so let's kind of transition to annuities

10:30
for a second

10:31
let me go over that and then i'll

10:32
combine the two and talk about them

10:35
in combination um annuities are

10:38
contracts

10:39
they're not investments now i'm one of

10:41
the few people out here that just pounds

10:43
that table

10:43
on that specific sentiment and the

10:46
reason i say that

10:47
is people say why do you say annuities

10:49
or contracts because you're going to get

10:51
a policy in the mail and it's a contract

10:53
so for me stan the annuity made

10:55
america's annuity agent license in all

10:57
50 states

10:59
i tell people that you buy the annuity

11:02
for the contractual guarantee you buy

11:03
for what it will do not

11:05
what it might do now annuities started

11:07
back in the roman

11:08
times and the first type of annuity back

11:11
then was a single premium immediate

11:13
annuity that was

11:14
set up for the dutiful roman soldiers

11:15
and their families as a pension that's

11:17
where

11:17
immediate annuities came from that's

11:19
where the word annuity came from

11:21
which the latin word annual means

11:22
payment i think or a lifetime payment my

11:24
ceo's like you don't know latin d i'm

11:26
like not really uh but i know that's

11:28
where it started

11:29
and and single premium immediate

11:31
annuities have been sold in this country

11:33
for

11:33
hundreds of years now i laugh when

11:35
people say i hate all the nudists

11:38
never buy one you already own one

11:40
everybody with a social security

11:42
number owns the best inflation annuity

11:44
on the planet it's called social

11:45
security

11:46
it's really that simple but the other

11:49
thing that kills me

11:50
when people say i hate all annuities

11:51
there's many different types of

11:53
annuities it's like saying you hate all

11:55
trucks you hate all restaurants you hate

11:56
all socks

11:57
you hate all cars you know you hate all

11:59
houses you can't hate all annuities

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number one you already own one number

12:02
two

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there's many different types now i've

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written seven books on the subject

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published them on amazon but i will give

12:09
them

12:09
away to you for free if you go to my

12:11
site at the annuityman.com you just have

12:13
to fill out where we got to ship it

12:15
and we'll ship you six annuity owner's

12:17
manuals on every type of annuity that

12:19
you need to understand

12:21
the good the bad the limitations and the

12:22
benefits i mean i literally lay it out

12:24
for you

12:25
in a 50 to 60 page owner owner's manual

12:28
per

12:28
product so go to the annuityman.com and

12:30
get my books we also have by the way

12:32
just to digress i'll get back to the

12:34
annuity thing in a moment we have

12:36
annuity calculators proprietary annuity

12:38
calculators you can run your own quotes

12:39
on the site

12:40
without having to talk to anybody or

12:42
interact with anybody um and if you want

12:44
to schedule a call with me stand annuity

12:45
man you can do that in a 30-minute

12:47
one-on-one conversation

12:49
that's not sales it's me and you talking

12:50
like we're talking

12:52
um here whether you're listening to the

12:53
podcast and driving down the road saying

12:55
yeah that guy's kind of a

12:56
straight shooter he's just he's brutally

12:58
factual or you're watching the fun

13:00
fun with annuities podcast on the

13:01
youtube channel you kind of get

13:04
the sense from me that i'm just a good

13:06
old boy from the south

13:07
grew up in north carolina um

13:10
i've been doing this for a long time in

13:12
the financial services business

13:14
and as my grandfather told me a long

13:15
time ago if you tell the truth you don't

13:17
have to remember anything

13:18
so i'm going to tell you if you do not

13:20
need an annuity now

13:21
um there are many different annuity

13:23
types there's multi-year guarantee

13:25
annuities which is a cd

13:27
um the annuity industry's version of a

13:29
cd

13:30
fixed index annuities which is kind of a

13:32
fancy cd

13:33
then you have the income products which

13:35
is single premium immediate annuity

13:37
deferred income annuities

13:38
qualified longevity annuity contracts

13:40
and then another income

13:41
strategy called income riders that you

13:43
can attach to

13:45
products like variable annuities and

13:46
index annuities again i have owners

13:48
manuals all that i'll send you that for

13:50
free

13:50
but understand that annuities are

13:52
transfer of risk contracts you're

13:53
transferring the risk

13:54
to the annuity company to pay you for

13:57
the rest of your life

13:59
regardless of how long you live i always

14:01
say there's no roi till you die

14:04
you should never ever ever buy an

14:06
annuity for market growth and i know the

14:08
indexed annuity people say market upside

14:09
with no downside and

14:11
market participation with with principal

14:13
protection and all that

14:14
garbage listen if that sounds too good

14:17
to be true product existed the fed would

14:20
just buy that

14:20
right i mean let's put our thinking caps

14:22
on um

14:24
there is no too good to be true product

14:25
i index annuities are great

14:28
i use them as cd products that's what

14:29
they are they're principal protection cd

14:31
products

14:31
of which you can attach and attach an

14:33
income rider that's exactly how i use

14:35
them that's exactly how they should be

14:36
used

14:37
and we sell an absolute boatload of them

14:39
but my clients

14:40
know they're not going to get market

14:42
returns on a blended

14:44
you know over time and just historically

14:46
since they were

14:47
index and news were introduced in 1995

14:49
they have not produced

14:52
market returns consistently in the

14:54
biggest raging bull market of all time

14:57
so that's kind of the wake up call

14:59
understand that annuities regardless of

15:01
the annuity type or like

15:02
i call them commodity products you shop

15:05
for annuities like you shop for a plane

15:06
ticket you shop all carriers

15:08
for the highest contractual guarantee

15:10
understanding like that the quotes are

15:12
like a gallon of milk

15:13
and when i say gallon of milk the quotes

15:15
expire every seven to ten days

15:18
so that doesn't mean you have to buy it

15:19
in seven to ten days but we we would

15:21
have to re-quote it

15:22
if you're analyzing the the policy or

15:24
analyzing the

15:26
the situation the numbers and thinking

15:27
about it you know every seven to ten

15:29
days we just have to re-quote it

15:30
now the easy part about annuities and it

15:32
is easy i've made it simple in fact on

15:34
my site you'll see making annuities

15:36
simple that's what i've done

15:38
it really comes down to two questions

15:40
and one acronym the two questions

15:42
that you have to ask and answer if

15:43
you're if you're going to deal with me

15:44
and i hope you do

15:46
is what do you want the money to

15:47
contractually do that's the first

15:48
question and when do you want those

15:50
contractual guarantees to start

15:52
again what do you want the money to

15:53
contractually do and when do you want

15:55
this contractual guarantees to start the

15:57
second thing that i use

15:58
is the acronym pills p stands for

16:00
principal protection i stands for income

16:02
for life

16:03
l stands for legacy and the other l

16:05
stands for long-term care confinement

16:07
care so principal protection income for

16:09
life legacy and long-term care

16:10
confinement care

16:11
answering the two questions and looking

16:13
at the pill if you don't need to

16:14
contractually solve for one or more

16:16
of those items in the pill you do not

16:18
need an annuity notice there's no g

16:20
there for growth

16:21
or m there for market or s there for

16:23
stocks

16:24
it's not there which is the reason that

16:28
annuities in the stock market kind of

16:30
work can work well together

16:32
period um remember i said earlier in the

16:35
in the podcast that

16:37
you kind of need to be in the stock

16:39
market i mean you really do

16:41
you don't have to own an annuity that's

16:43
the difference

16:44
you have to be in the stock market for

16:46
growth unless you're

16:48
i guess you're 90 years old and you

16:49
don't need growth anymore but the

16:50
majority of us out there the people that

16:52
are listening this podcast are watching

16:53
this podcast

16:54
you have to be in the stock market you

16:57
do not have to own an annuity

16:59
and in fact with annuities the annuity

17:01
industry frowns upon you

17:03
putting more than 50 percent of your

17:05
investable assets in an annuity

17:07
i guess we can push it a little bit more

17:09
maybe to 55 60 percent based on your

17:11
situation

17:12
but their broad brush on that is no more

17:15
than 50 percent of your investable

17:16
assets that's not including your house

17:18
your car

17:19
or your guitars okay it's investable

17:22
assets

17:23
iras 401ks 457s 403bs

17:27
you know those type of things cash

17:29
accounts those

17:30
those things investable assets so

17:34
it's important to if you're going to use

17:36
an annuity if mean you have a

17:37
conversation and demon appropriate that

17:39
an annuity strategy transferring that

17:41
risk

17:42
makes sense then we have to make sure

17:44
it's allocated right and in proportion

17:46
okay now we can run quotes for you

17:50
and customize the quotes you can run

17:51
them on our on our site at

17:53
theannuityman.com

17:54
at your leisure but i would encourage

17:56
you once you run them and get the

17:57
the feel for the quotes and what the

17:59
numbers are then you schedule a call

18:00
with me

18:01
then we go in and we do a customized uh

18:03
quote for you and maybe we ladder it

18:05
maybe we

18:06
we could do a lot of things i mean i've

18:08
been doing this a long long time written

18:10
seven books on the subject so there's

18:11
not a situation

18:13
that i have not seen yet so i mean

18:15
that's

18:17
you know the other thing too getting

18:18
back to the kind of the correlation

18:21
or the uh comparing stock market to

18:23
annuities

18:25
within with the stock market you got

18:26
unlimited choices you got stocks and

18:28
bonds and mutual funds and etfs and gold

18:30
and commodity and all this stuff

18:32
you have limited choices with annuities

18:35
you have limited strategy choices which

18:37
is fine remember they're contracts

18:40
now yes say for instance there's

18:42
hundreds and hundreds of my gas

18:43
multi-year guarantee annuity fixed rate

18:45
annuity again that's the nudity industry

18:46
version of the cd

18:48
and there's there's hundreds of

18:50
different fixed indexed annuities

18:52
or variable annuities but at the end of

18:53
the day they're all kind of the same

18:55
from the standpoint of what they

18:57
what they do or some better than others

18:59
that's for

19:00
that's for us to uh analyze but for me

19:04
i only looked at contractual guarantee

19:06
so i'm going to if

19:07
if we come up with a structure for you a

19:09
customized strategy

19:11
i'm only going to look at the

19:12
contractual guarantees

19:14
of the policy period end of story

19:18
worst case scenario armageddon you're

19:19
going to make the decision right there

19:21
not

19:21
not some pie in the sky what if

19:22
potential hypothetical theoretical

19:24
unicorns chasing the butterflies

19:26
no we're not doing that we're not doing

19:29
that because it never comes true

19:31
um one of my favorite people in the

19:33
index annuity industry and she's a

19:34
leader in the industry

19:36
she always says she's never seen a

19:38
proposal come true

19:39
um yes i guess you could use it as a

19:41
guide but to look at back

19:43
tested numbers is a joke in the annuity

19:46
industry in my opinion

19:47
you own an annuity for what it will do

19:49
not what it might do you own it for the

19:50
steak not the sizzle

19:52
you you never buy the dream because

19:54
you're going to own the contractual

19:55
realities have i given you enough

19:57
one-liners to to drive it home so

20:00
how does the stock market and annuities

20:03
kind of work together

20:04
to me the way to do it if you're in the

20:07
stock market is to use the annuities

20:10
for your income floor because annuities

20:12
are the only product on the planet

20:14
period end of story that provide a

20:16
lifetime income stream that will pay you

20:18
for the rest of your life regardless of

20:20
how long you live that's the unique

20:21
benefit proposition

20:23
and monopoly that annuities have that no

20:26
other product has

20:27
now you would think if i was annuities

20:29
are for the day which i should well

20:30
actually the

20:31
the new administration at the time of

20:33
this taping they're transitioning

20:34
you should hire stan the annuity man as

20:37
annuities are because i would talk about

20:39
i'd run the ad remember the god milk ad

20:41
where they had the the guy

20:42
it'd be got guarantees you got

20:43
guarantees because annuities are

20:46
contractual guarantees so in the stock

20:48
mark for the stock market people always

20:50
say listen

20:51
let's use as little amount of money as

20:53
humanly possible

20:54
to contractually solve for the goals you

20:56
want with annuities

20:57
for example if you said i need i'm

21:01
speaking for you

21:02
i need uh three thousand dollars a month

21:04
for me and the wife for the rest of our

21:06
lives period for us to live a good life

21:08
in combination with what we're getting

21:09
from social security and all this other

21:11
stuff

21:12
rental income if you're pa if you if you

21:14
have a pension if you're so fortunate if

21:15
your

21:16
private company offer that or if you

21:17
work for the government whatever

21:19
whatever's coming in on a monthly basis

21:21
that income floor

21:23
is what what makes you sleep well at

21:25
night and i have found and i have

21:28
hundreds and hundreds and hundreds of

21:29
cases and clients that have told me

21:31
you know what i'm a better investor

21:34
because i know that the income floor is

21:35
contractual

21:36
i know that the income floor is in place

21:38
i know that it's going to pay us for the

21:40
rest of our lives

21:41
i know that i have the best inflation

21:42
annuity on the planet which is social

21:44
security

21:45
and i have these other annuities that

21:46
are going to pay me a lifetime income

21:48
stream and we can have the income stream

21:49
start immediately

21:50
and tell you to the penny what it's

21:51
going to be or down the road in the

21:53
future and tell you to the penny what

21:54
it's going to be

21:56
because why annuities aren't investments

21:58
they're contracts

21:59
right nod your head yes they are do they

22:02
work together

22:03
i think they do i think they do and i

22:06
think for the stock market people

22:08
the biggest hurdle that i have with

22:11
investors and i have you know

22:13
having worked on wall street with those

22:14
four large firms i mean obviously i had

22:16
hundreds and thousands thousands of not

22:18
hundreds of thousands but thousands of

22:20
clients

22:21
and i understand the markets i

22:23
understand

22:24
that the appeal and i understand people

22:27
wanting to be there

22:29
but i also understand that you can't

22:31
have all your eggs in one bat

22:32
and one basket that includes the stock

22:34
market and that certainly includes

22:36
annuities

22:38
but i think the combination of

22:40
shouldering risk in the markets and then

22:42
transferring risk with annuities is a

22:44
good thing

22:45
a lot of people don't need lifetime

22:46
income so how do annuities work for

22:49
people that don't need life

22:50
lifetime income but want to stay in the

22:52
market you could buy the cd type

22:54
products that protect the principal no

22:56
annual fees

22:57
and you're going to get cd type returns

22:58
those are multi-year guarantee annuities

23:00
and fixed indexed annuities i know

23:02
that's not what you've heard on indexed

23:04
news but that's the truth

23:05
i mean they should be looked at as cd

23:07
products because that's what they were

23:08
designed to do

23:09
in 1995 is to is to compete with cd

23:12
returns and that's exactly what they do

23:14
and by the way

23:15
as an industry i beg and plea the agents

23:18
to embrace that

23:19
embrace the fact that fixed indexed

23:20
annuities are cd products

23:22
there's nothing wrong with that so if

23:23
you had stock market sub you said you

23:25
know what stan i just need to hit some

23:26
bunt singles baseball analogy i don't

23:28
need to swing for the fences and knit

23:29
doubles and triples and home runs

23:31
i just want to make sure the principal's

23:32
protected and i want to get some

23:34
interest then you go to multi-year

23:36
guarantee annuity fixed rate annuities

23:38
and

23:38
fixed indexed annuities period you can

23:41
get them short right now at the time of

23:42
this taping

23:43
as short as two years the multi-year

23:45
guarantee annuities

23:47
and you can lock in as far out as you

23:49
know 10 or 15 years i wouldn't tell you

23:50
to do that but i mean you can do what

23:52
you want to do

23:53
and it might be part of the customized

23:54
plan um for us to put together

23:57
so the other thing is is let's talk

23:59
about

24:02
kind of how the stock market affects

24:05
annuity pricing i guess that's the next

24:07
thing and the next little hurdle we have

24:08
to

24:09
we have to overcome here and explain

24:12
annuity pricing lifetime income so the

24:15
lifetime income products

24:16
immediate annuities deferred income

24:18
annuities q lakhs qualified longevity

24:20
annuity contracts that's what that

24:21
stands for

24:22
and income riders those are primarily

24:24
priced

24:25
on your life expectancy or life

24:27
expectancies if it's

24:28
joint with a spouse or partner at the

24:31
time you start the payment let me repeat

24:33
it again

24:34
lifetime income is primarily based on

24:35
life is life expectancy

24:37
not interest rates do interest rates

24:39
play a secondary role

24:40
yes they do play a secondary role in all

24:43
lifetime income regardless of type so if

24:45
you're turning on an income stream with

24:47
immediate annuity qualified longevity

24:48
annuity contract

24:50
income right or deferred income annuity

24:52
it's a combination return or principal

24:53
plus

24:54
interest with you understanding that if

24:57
it draws down to zero the annuity

24:58
company's still on the hook to pay

25:00
regardless of how long you live you also

25:02
to point out a lot of people say oh i

25:03
never bought a news thing because when i

25:05
die

25:05
the evil annuity company keeps the money

25:08
by the way for everyone out here who

25:09
hasn't heard that that's my chester

25:10
voice

25:11
and chester's the mythic guy that calls

25:13
me every day and [ __ ] about something

25:15
he doesn't know which is

25:16
about annuities well i'm not going to

25:18
blog because they knew they're going to

25:19
keep some money

25:20
that's only one of about 40 ways to

25:22
structure the

25:23
the lifetime income stream we can

25:26
structure and i would say

25:27
you know we sell more nuisance on the

25:28
planet i'd say 90 plus percent of the

25:30
annuities that we sell for lifetime

25:32
income

25:32
guarantee the lifetime income stream but

25:34
we also structure it

25:36
contractually so that any unused money

25:38
upon your death

25:40
goes to the listed beneficiary in full

25:42
and the evil annuity company doesn't

25:43
keep a penny even though they're on the

25:44
hook to pay

25:46
so poof with that misconception um

25:49
the other thing you have to understand

25:51
about annuities is similar to stocks

25:54
in stocks you can have stocks in roth

25:55
iras and traditional iras and

25:57
non-qualified accounts non-iras

26:00
same with annuities contractual

26:02
guarantees are the same

26:03
the taxation of the money coming out is

26:05
different right you can have annuities

26:06
in traditional iras so if anybody out

26:08
there says

26:09
don't ever put an annuity inside of an

26:11
r.a

26:12
they are not smart people or maybe

26:15
they're smart people they just don't

26:16
know what they're talking about with

26:17
annuities

26:18
but that's the dumbest thing i've ever

26:19
heard when you buy an annuity put it

26:21
inside of an ira you're buying the

26:23
contractual guarantee which is what you

26:24
should be doing anyway regardless of the

26:26
account

26:26
so you can have an annuity of any type

26:29
okay except

26:30
culex are the only ones that can only be

26:32
used in a traditional ra oh by the way

26:34
that's kind of

26:34
that kind of throws a lot that kind of

26:36
solves it right there qualified

26:38
longevity annuity contracts were

26:39
designed to put inside of an ira

26:41
for all you geniuses out there that say

26:43
don't put an annuity inside of an ira

26:45
so you can put them you know in non-ira

26:48
roth ira

26:49
you know traditional ira i mean

26:51
annuities just like stocks

26:52
and just like anything in the markets

26:54
can be put in those types of accounts

26:57
um you know one of the things we talk

26:59
about uh

27:00
in in the sane and the motto or this

27:02
fund with annuities podcast by the way

27:04
in the do not might do studios shooting

27:07
it on the annuity fund cam

27:09
our motto is living the reality not the

27:12
dream everyone says how you doing i'm

27:14
living the dream

27:15
okay whatever living the reality means

27:18
you're buying annuities for the

27:19
contractual guarantees only

27:21
only you're not buying the hypothetical

27:24
theoretical projected back-tested

27:25
unicorns chasing the butterflies

27:27
hopeful agent returns scenario that

27:29
looks so good with the proposed juice

27:31
numbers on those pieces of paper that

27:32
they can't guarantee

27:34
you buy it for the worst case scenario

27:36
every single quote you get from stan the

27:38
annuity man on the annuityman.com

27:41
is a contractually guaranteed number

27:44
period end of story because that's the

27:48
way

27:48
they should be purchased why because the

27:51
growth part of your portfolio

27:52
should be in the stock market it's just

27:56
really that simple

27:57
but getting back to i digressed a little

27:59
bit but i know where i'm at i know where

28:01
i'm at in

28:01
what place i'm at on here i'm i've got a

28:04
good mon i've got a good mind going here

28:05
standing annuity man

28:07
we were talking about how the markets

28:09
affect annuities

28:10
now if the the 10-year treasury is kind

28:13
of the

28:13
bogey for uh annuity companies

28:17
that when they're looking at interest

28:18
rates but but the pricing

28:20
using the interest rate is not as static

28:22
as that

28:24
now currently uh multi-year guarantee

28:26
annuities cd type annuities that the

28:28
annuity industry revert

28:29
annuity industry version of a cd are

28:32
offering

28:33
much higher yields than certificates of

28:35
deposits

28:36
so you know annuity companies are a

28:38
little bit more dynamic than banks

28:40
annuity companies have

28:41
you know they have the fixed rate

28:43
products like multi-year guarantee

28:44
annuities

28:44
but they also have life insurance

28:47
because life insurance

28:48
companies issue annuities so there's

28:50
life insurance portfolio as part of

28:52
of these companies 99 of annuity

28:54
companies okay

28:55
um and there's also that there's also

28:58
lifetime income products so

29:00
you know they're they're paying people

29:01
out uh a lifetime income stream

29:04
based upon life expectancy so they'll

29:06
have you know

29:07
billions of dollars based on a bunch of

29:09
65 year olds right and some are going to

29:11
live longer than projected some are

29:12
going to live shorter than projected

29:14
and some of them are going to die right

29:15
on the money with a projected life

29:17
expectancy

29:18
just remember this the reason that the

29:20
annuity companies have the big buildings

29:22
for reason and sponsor sports stadiums

29:23
and have the big logos on the planes

29:26
is because they know when we're going to

29:27
die life insurance companies know when

29:28
we're going to die

29:30
the reason that there's not big huge

29:32
behemoth buildings for property and

29:34
casualty companies

29:35
is they don't know when the hurricane in

29:36
the tornado and their fire is going to

29:38
hit

29:38
they have no idea life insurance

29:40
companies know when we're going to die

29:42
and they price things accordingly so

29:43
when they're

29:44
offering a little bit higher rate on a

29:45
multi-year guarantee annuity and cds are

29:47
a lot lower

29:49
it's because they're taking their whole

29:50
portfolio of life insurance lifetime

29:52
income and fixed rates

29:54
and pricing it so that they can give the

29:56
client a contractual guarantee and still

29:59
the annuity company makes some money

30:00
don't feel sorry for them they don't

30:02
give anything away they have

30:03
like i said they have the big buildings

30:04
for a reason but the markets do affect

30:07
annuities pricing in some sense because

30:10
that 10-year treasury is is a reflection

30:12
of the overall environment and the

30:13
economic

30:14
economic environment the markets etc and

30:17
obviously if the 10-year treasury was

30:19
way high you know jimmy carter type

30:21
yield

30:22
interest rates you know that would

30:24
affect uh some of the pricing

30:26
with annuities but i will tell you that

30:29
you cannot

30:30
time it you cannot say well i'm going to

30:32
wait to buy

30:34
my immediate annuity to rates go up

30:36
interest rates

30:37
well if you do that chester you have to

30:39
factor in

30:40
the payments that you missed while you

30:42
were waiting to time

30:43
the markets and to time interest rates

30:46
with annuities again they're not

30:48
investments they're contracts if if the

30:50
contractual guarantee fits your

30:51
situation then perfect and remember

30:54
we can run reverse engineers quotes we

30:56
can we you can say to me hey we need 2

30:58
500

30:59
a month let's use as little money as

31:00
humanly possible to create that

31:02
and here's we want when we want the

31:03
income to start

31:05
but you know from the standpoint of um

31:09
obviously if in a raging good economy

31:11
you know all

31:12
you know all boats rise right i don't

31:14
know what that saying is but you know

31:15
what i'm saying

31:17
i mean if it's if the economy is good

31:19
it's good for everybody

31:20
but also to tell people this annuity

31:23
companies aren't smarter than banks or

31:25
or brokerage firms they're just more

31:27
regulated i mean there's a

31:28
there's some heavy rules in place for

31:32
what the annuity companies have to put

31:34
your money in

31:36
when you give them money so i mean

31:38
that's a good thing as well

31:39
but never ever ever ever ever and let me

31:42
kind of close with this

31:43
too um never compare

31:47
the stock market in annuities never

31:49
compare investments to contracts

31:52
one's a shouldering of the risk and one

31:54
is a transferring of the risk

31:56
so when people i hear this all the time

32:00
i had a call today and the guy said well

32:02
i looked at the

32:03
returns of the blah blah blah the

32:06
lifetime income stream and i could

32:07
outperform it

32:08
with my stocks i hope so chester i hope

32:11
so because you're talking about apples

32:13
and oranges

32:14
okay if you can't beat

32:17
you know if you're going to look like

32:19
that then stay in the markets

32:21
but if you're going to look at the

32:22
annuities the way they should be as

32:23
transfer risk products whether

32:25
whether it's for principal protection or

32:27
a lifetime income stream it's the only

32:29
product that can do that

32:30
then you can't compare stock market to

32:33
annuities that's not a sales pitch

32:35
that's a fact that doesn't mean you have

32:36
to buy one but you cannot walk around

32:38
going

32:39
well you know my mutual funds will do

32:40
better than annuity

32:42
apples and oranges it doesn't make sense

32:44
to say that

32:45
so one of the things i want you to walk

32:47
away from this is stock market and

32:49
annuities can work together but they're

32:50
two different animals

32:52
one's a a shouldering of the risk stock

32:54
market and one is a

32:56
transferring of the risk so

32:59
remember this and this is coming from

33:01
stan the annuity man america's annuity

33:03
agent the number one agent on the planet

33:06
licensed in all 50 states you kind of

33:08
have to be in the stock market but

33:10
you don't have to own an annuity that's

33:12
pretty that's pretty harsh words and

33:14
truthful words

33:16
from stan the annuity man so with that i

33:19
appreciate you joining me go to

33:21
theannuityman.com for

33:22
for run quotes get my books ship them to

33:24
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33:25
and to schedule time with me stand the

33:27
annuity man and i hope

33:29
that you will join me on the next fun

33:31
with annuities

33:36
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33:38
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33:47
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33:54
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34:00
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34:03
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34:06
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34:08
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34:10
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34:11
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34:14
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34:15
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