041 Why you need to take a closer look at Income Riders

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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 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

0:44
annuity man america's annuity agent

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licensed in all 50 states

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also the top independent annuity agent

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in the country

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that represents every single carrier out

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there pretty much

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so if you're looking for the highest

0:56
contractual guarantees you can come to

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me and me only for that now let's get to

1:00
today's topic

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uh which is a really hot one and for

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those uh people that are listening to me

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on the

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the podcast platforms spotify itunes etc

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um i'm wearing this red sweatshirt that

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the people on my fun with annuities

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youtube channel is

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watching right now with the red hat

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because this is a hot topic and the

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topic is

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why you should take a closer look at

1:23
income riders you know income riders are

1:26
kind of the hot you know product

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attachment

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that's sold in the annuity industry by

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the way for the people that are watching

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this on the

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fun with annuities youtube channel i

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mean you're watching this on the annuity

1:37
fund cam in the will do not might do

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studio in our saying here at the fund

1:40
with annuities podcast

1:42
is living the reality not the dream

1:44
what's the reality contractual

1:45
guarantees that's the reality

1:47
the dream is the hypothetical

1:48
theoretical back tested hopeful agent

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unicorn chasing the butterflies nonsense

1:54
sales pitches that you hear

1:56
all the time and income riders

1:57
unfortunately are part of that

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kind of crap sales pitch that's flying

2:01
across the country and on

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you know bad bad chicken dinner seminars

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and bad radio ads and bad tv ads etc

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but i'm going to clear all that up

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because i'm staying the annuity man

2:10
america's annuity agent

2:12
so let's get right to the topic of

2:14
income riders first of all

2:15
what in the heck is an income rider

2:19
first of all an income writer is not

2:21
even an annuity

2:22
i see you can't say well stanley knew to

2:25
me i don't want to buy

2:26
anything but an income right i just want

2:27
to buy the income right you can't an

2:29
income writer is an attachment

2:31
to a policy that is a contractual

2:34
guarantee primarily for income

2:36
now that attachment you don't have to

2:38
put on the annuity

2:39
and there's only a couple of types

2:40
currently that the majority of income

2:42
writers are attached either to

2:44
variable annuities or fixed indexed

2:47
annuities now i don't sell variable

2:48
annuities i have nothing against them

2:49
but i don't sell anything that has the

2:50
potential to go down

2:51
because my saying is you own an annuity

2:53
for what it will do not what it might do

2:54
in the world is contractual which means

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we're not going to lose a penny which

2:57
means i only sell fixed annuities

2:59
are we clear not your head now the other

3:02
thing about income riders when you

3:03
attach them to

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um indexed annuities typically and

3:07
historically the guarantees are higher

3:10
the contractual guarantees are higher

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than when you attach those

3:14
same types of income riders um

3:17
to variable annuities now stop for just

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a quick second here

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stan the annuity man america's annuity

3:23
agent has written a book

3:25
easy to understand owner's manual about

3:27
50 to 60 pages long you can read it

3:30
quickly but it's income rider's owner's

3:32
manual if you go to the annuityman.com i

3:34
will send you a copy for free

3:36
no obligation no one's going to call you

3:38
and and

3:39
interrupt your dinner or show up at your

3:40
doorstep trying to sell you an annuity

3:42
i'm just going to educate you on that

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and by the way if you do want a quote

3:46
you can get a quote on income writers at

3:47
the annuityman.com

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but back to the point of what an income

3:51
writer actually is it's an attached

3:53
benefit to a policy

3:55
at that you choose to attach at the time

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of application

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and you typically attach that income

4:00
rider to a variable or

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indexed annuity fixed indexed annuity

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in my world of contractual guarantees

4:08
only

4:10
when we sell indexed annuities we

4:13
primarily

4:14
sell them to deliver the income rider

4:17
we have found that the index annuity is

4:19
a is an efficient

4:21
and cost effective way to deliver the

4:23
income rider guarantee

4:26
we could give a rip about the

4:29
pie in the sky back tested nonsense

4:31
sales pitches of the index options

4:34
just just to go back a little bit and to

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educate you

4:37
so you don't believe the hype as the

4:39
rapper says

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indexed annuities were put on the planet

4:43
in 1995 to compete with cd returns

4:45
that's exactly what they do

4:47
that's good it's a principal protection

4:49
product it's not a security

4:50
it's a life insurance product issued at

4:52
the state level

4:54
but we have found that the best way to

4:56
attach

4:57
income riders is to fixed indexed

4:58
annuities

5:00
so that's the good news now getting kind

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of to the

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to the point of what is an indexed

5:06
annuity remember the two questions i've

5:08
always asked people and if you're

5:10
listening to me for the first time i

5:11
mean this is this is the the shocker of

5:13
all shockers

5:14
and if you're an agent write it down

5:16
question number one

5:18
what do you want the money to

5:19
contractually do

5:21
question number two when do you want

5:22
those contractual guarantees to start

5:25
so under those two question scenario

5:28
and also have a acronym called pill p

5:30
stanford

5:31
stands for principal protection i stands

5:33
for income for life

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l stands for legacy and the other l

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stands for long-term care

5:38
income riders far fall under the eye of

5:40
p-i-l-l which is income for life

5:43
income riders are lifetime income

5:45
products they pay you for the rest of

5:46
life

5:47
rest of your life regardless how long

5:48
you live there's no roi until you die

5:51
if you live 150 they're on the hook to

5:53
pay they meaning the annuity company

5:55
okay but attached to a a policy

5:59
it's a separate calculation so when you

6:01
attach it to say an indexed annuity

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it's a separate calculation now for the

6:05
people that are driving down the road

6:06
and their lamborghinis and trying to

6:08
figure out what an

6:09
income writer is i'm gonna do a visual

6:10
for you draw a line down a blank sheet

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of paper

6:13
for the people watching me on the on the

6:14
phone with annuity annuities youtube i'm

6:16
drawing the line with my hand on a blank

6:18
sheet of paper

6:20
right hand side is the income writer

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side

6:23
okay left hand side is the accumulation

6:25
value side

6:26
for variable annuities the accumulation

6:28
value of the mutual funds or the

6:29
separate accounts they call them

6:31
separate accounts i call them mutual

6:32
funds

6:32
for indexed annuities that's the index

6:34
option strategies that we don't know

6:35
what it's going to be

6:36
but the agent promises market returns

6:38
you're never going to get it it's a cd

6:39
return

6:40
but that right hand side is the income

6:43
writer side

6:44
and it's going to it's a separate

6:45
calculation when you get your statement

6:47
and it's going to grow by a specific

6:49
percentage typically that's how they're

6:51
structured

6:52
until you turn on the income and when

6:54
you turn on the income stream

6:55
you're going to base your income on that

6:57
amount on the right hand side of the

6:59
ledger that income rider side

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now i know the sales pitch out there is

7:03
that well if the left-hand side is

7:05
higher than the right-hand side then you

7:06
can choose one of the

7:08
yeah that that's garbage okay

7:11
annuity companies attach income or want

7:14
when you attach an income rider to to a

7:16
policy the annuity companies like it for

7:17
lack of a better phrase

7:19
because the income rider side is always

7:23
going to be higher than the accumulation

7:24
value size why

7:26
is that important it's important because

7:29
you can't cash out the income rider side

7:33
okay it's it's monopoly money and a

7:35
phantom account that can only be used to

7:37
calculate

7:38
your first lifetime income payment

7:40
period end of story

7:42
now that's kind of where the weird sales

7:44
pitches come in when

7:45
people say well i can get you a seven

7:47
percent return or an eight percent

7:48
return or seven point two percent return

7:51
mr mr johnson uh and that's the agent

7:54
talking in some weird voice

7:56
listen jimmy carter's not in office he's

8:00
building houses in georgia hopefully

8:01
he's still alive at the time of this

8:02
taping

8:03
the point is there's no genius at an

8:05
annuity company that's figured out how

8:07
to

8:07
how to create a seven percent yield out

8:10
of one percent ten-year treasury notes

8:13
hello now is it contractual yes

8:16
but you can't peel off the interest of

8:18
an income rider you can't cash in an

8:20
income rider

8:21
and you can't transfer the total of an

8:22
income rider

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so if you put a hundred thousand dollars

8:25
in and it's growing by seven point two

8:27
percent on the income rider side

8:28
stop it's not real money okay it's

8:32
it's monopoly money fandom account and

8:33
it's growing about seven point two

8:35
percent

8:35
in ten years that hundred thousand turns

8:37
into two hundred thousand contractually

8:40
and you can take the income from that

8:42
and determine from that amount

8:44
that's how an income rider works but you

8:46
can't cash it in

8:48
now income riders also come with fees

8:51
obviously annuity companies have the big

8:52
buildings for a reason as i always say

8:54
and they have the big logos on the plane

8:56
but the fees from the income rider do

8:58
not come from the income rider side of

9:00
the ledger that right hand side

9:02
it comes from that accumulation value

9:04
that so the fee

9:05
is taken out of that accumulation value

9:08
annually and for the life of the policy

9:10
how about that but who cares

9:13
if we're buying the income rider for the

9:14
right reasons for income

9:16
later okay then then who cares because

9:20
that is a net transaction to you that's

9:22
a transfer risk that's a lifetime

9:24
pension

9:24
that's what an income rider is it's a

9:26
lifetime pension that's flexible now

9:28
let's go backwards a little bit back to

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the two questions

9:31
what do you want the money to

9:32
contractually do when do you want those

9:33
contractual guarantees to start

9:36
there are two products that fit into

9:37
what i call income later so your answer

9:39
is i need incomes done

9:41
and i need to income just down the road

9:43
okay great

9:44
two products deferred income annuities

9:46
and income riders

9:47
now when you and i talk go to stan go to

9:50
the annuity man and schedule call

9:51
30 minutes at the top you can just book

9:53
a call with stan you're gonna get me

9:55
and i ask you those two questions and

9:56
you give me that answer which is i need

9:58
income and i need

9:59
income down the road that's an income

10:00
later quote to me

10:02
and the standing annuity man america's

10:04
annuity agent world

10:05
and i'm going to quote both deferred

10:06
income annuities and income riders to

10:08
find the highest contractual guarantee

10:11
for your specific situation the other

10:13
thing too

10:14
income riders can be used in non-ira

10:17
accounts and

10:18
ira accounts so yes for all you advisors

10:21
and agents and masters

10:22
master of the universe never put

10:23
annuities off in our register

10:25
that's corpola okay yes you can put an

10:28
income rider inside of an ira

10:30
or inside of a roth ira and so when the

10:33
when you take the income

10:34
you're going to pay taxes on the income

10:35
at ordinary income levels because

10:37
everything coming out of your

10:38
traditional ira

10:39
is taxable at ordinary income levels if

10:42
it's in a roth ira rate stack free

10:44
okay got it and if it's in a

10:46
non-qualified account

10:47
it's tax to ordinary income levels last

10:50
in first out gains first

10:52
that's all the tax advice you're getting

10:53
from standing annuity man because

10:55
otherwise

10:56
i don't give tax advice i mean you need

10:58
to go see a cpa or tax lawyer but that's

11:00
the basics of an income writer

11:02
now one of the things that people always

11:04
say well

11:05
which ones better stand the annuity man

11:07
is it a deferred income annuity

11:09
or is it a income rider you know what's

11:11
once better

11:12
which one's better is the highest

11:13
contractual guarantee is which one's

11:15
better

11:16
but they are two different products

11:18
deferred income annuities

11:19
and income riders suffer what i call

11:22
income later which is

11:23
income down the road you know standalone

11:25
income in five years or seven years or

11:26
10 years or 12 years whatever i want it

11:28
to start then

11:30
the difference is just how they

11:31
contractually get there they both

11:33
provide contractual guarantees they both

11:35
pay a lifetime income they both

11:37
you can't never outlive the income

11:39
stream they're both transfer risk

11:41
products they're both pensions

11:42
okay they can be set up single life

11:44
joint life whatever however

11:46
you want to customize it um

11:49
but which one's better they're different

11:51
okay deferred income annuities are very

11:53
simplistic

11:54
it's an irrevocable a contract you're

11:56
going to get your money back but you're

11:57
going to get it with payments one of the

11:58
things

11:59
i like about income writers and why you

12:02
need to get my book and run quotes and

12:04
talk to me

12:05
about them is they're flexible and what

12:07
do i mean by that stand the annuity man

12:09
america's annuity agent

12:10
flexible means that you still control

12:13
the asset

12:14
meaning that you can get to the to the

12:17
desired

12:18
end of the line to turn on the income

12:19
stream and say you know what i don't

12:21
want to do that

12:22
let's not do that or you could say i

12:24
want to defer it farther out

12:25
or i want to start the income sooner or

12:28
i want to start

12:28
start and stop the income you can do

12:30
that income riders

12:32
are flexible meaning you know if you

12:34
change your mind or things change in

12:36
your life you don't have to turn on that

12:37
income rider now yes you've been paying

12:39
for that

12:40
that income rider guarantee but i like

12:42
the flexibility because

12:43
obviously and i'm going to tell you

12:44
something you already know we live in a

12:46
pretty volatile world that's have

12:47
that's ever changing nod your head

12:50
absolutely

12:51
so income riders still provide the

12:53
contractual guarantee you still can

12:55
i can tell you to the penny what your

12:58
contractual guarantee will be two years

12:59
four years five years seven years nine

13:01
years whatever

13:02
down the road for planning standpoint

13:05
but you don't have to turn on the income

13:07
stream

13:09
period i mean i think that's i think

13:10
that's a positive that not many people

13:13
realize

13:14
about income riders they're flexible and

13:16
like i said they can be used in both ira

13:18
and non-ira

13:19
um the other thing that that is sold

13:22
improperly let's just start there

13:24
is here's the bad chicken dinner seminar

13:26
pitch uh you get an upfront bonus of 10

13:29
you get market growth with no downside

13:31
and you get lifetime income and you get

13:33
free

13:33
long-term care first of all that's

13:35
garbage that's the bad chicken doing or

13:37
seminar pitch

13:38
yes some index annuities have upfront

13:40
bonuses but you know that's candy for

13:42
the stupid is what i call that that's

13:44
that's just part of the overall

13:45
contractual guarantee that there's not

13:46
philanthropists that annuity come he's

13:48
waking up in the morning going

13:49
you know what i think i'm going to give

13:52
away money today to the people that i

13:54
love and don't know

13:55
no there's no one like that it's just

13:56
part of 100 pennies in the dollar is

13:58
part of the overall contractual

13:59
guarantee

14:00
and when we quote it we're quoting every

14:02
single writer out there with or without

14:03
bonuses

14:04
you know whatever um so that doesn't

14:07
matter and then

14:08
the other part of the pitch is no market

14:10
upside with no downside

14:11
wrong index annuities are cd products um

14:14
and but then here's the best one when

14:15
they say free long-term care

14:19
whatever no you won't know uh that's not

14:22
it

14:22
long-term care is a health insurance

14:24
product um not a life insurance product

14:27
and annuities or life insurance products

14:29
what the agents are talking about when

14:31
they pitch you this

14:32
free long-term care it's not long-term

14:35
care long-term care is a health care

14:36
product if you really want to dig into

14:38
long-term care

14:39
i can refer you to the number one

14:40
long-term care person on the planet he's

14:42
a good friend of mine and he shoots it

14:43
straight just like i do

14:44
but what the what they're talking about

14:46
and what

14:48
some but not all carriers offer is

14:50
what's called confinement care or

14:52
nursing care enhanced benefit um

14:55
coverage if you get sick or can't do two

14:57
of the six

14:58
um daily functions of life it and those

15:00
are you know feed yourself clothe

15:02
yourself bathe yourself you know if you

15:03
can't do those

15:04
life stinks anyway and you're gonna live

15:06
an average of three years and a maximum

15:07
of seven

15:08
period but with some of the income

15:10
riders not all

15:12
i would say right now about 20 to 25

15:14
percent of all income writers

15:15
have what's called a guaranteed

15:18
confinement care enhanced benefit

15:19
coverage so that if you cannot qualify

15:22
for long-term care

15:23
then this is a guaranteed issue product

15:25
so if you're smoking at

15:27
you know 12 cartons of lucky strikes

15:29
without the filter

15:30
and you're and you're chasing that down

15:32
with a bottle of jack daniels neat

15:35
then you qualify because you're not

15:37
going to qualify for regular long-term

15:39
care

15:39
the one thing i do have to say about

15:41
that is if someone ever says to you

15:43
buy this indexed annuity with this

15:45
income rider for for long-term care even

15:47
though

15:48
i just explained it's confinement care

15:50
never ever ever ever

15:51
ever ever cash in your traditional

15:54
long-term care coverage

15:55
for this confinement care type benefit

15:58
in a perfect world that stan the annuity

16:00
man america's annuity agent wants to

16:02
live in and wants you to live in there

16:03
with me

16:04
in a perfect world income riders that

16:06
offer these confinement care

16:08
benefits should you be used as

16:10
supplemental coverage not primary

16:12
coverage

16:13
so yes it's guaranteed but because

16:16
there's no underwriting and there's no

16:18
test and no blood work and no nurse to

16:19
show up

16:20
nurse ratchet showing up at your house

16:22
to take the blood

16:23
um you know it's as i say in the south

16:26
this cu this coverage is when you get

16:28
sicker you get your money back quicker

16:30
that's really what it is that doesn't

16:32
mean it's bad but what happens is

16:34
they'll double that income stream so

16:35
let's just say as an example you're

16:38
getting ten thousand dollars a month

16:40
in income or let's let's be more

16:41
rational let's just say you're getting

16:42
four thousand dollars a month in income

16:44
from

16:44
from the income rider okay and you

16:47
qualify for the confinement carry you've

16:48
proven to the carrier and we've helped

16:50
you prove that

16:51
that you you you qualify for the

16:53
enhanced benefit typically they'll

16:55
double that payment so in other words if

16:56
it's

16:57
four thousand dollars a month it's eight

16:58
thousand dollars a month and it's

17:00
specific

17:01
most carriers are now at the point not

17:03
all most carriers they'll pay that

17:04
doubling um amount for five years why

17:08
what did i just say if you if you

17:09
qualify you live an average of three and

17:11
a maximum of seven

17:12
okay you're not going to beat the

17:14
annuity company you're not going to beat

17:15
the life insurance company

17:17
you're certainly not going to be any

17:18
type of long-term care coverage

17:20
but just remember long-term care that

17:22
that phrase

17:23
is a health insurance product

17:25
confinement care benefits enhanced

17:27
benefits attached to

17:28
income riders that's a life insurance

17:30
product that's guaranteed issue that's

17:32
fine

17:33
it's if you want to you know if you want

17:35
to have that but i

17:36
personally i wouldn't shop for that in

17:38
other words i would go into the

17:40
the income writer quote and say i want

17:42
the highest contractual guaranteed

17:44
income writer quote

17:45
and if just oh by the way there's an

17:48
enhanced benefit confinement care

17:49
benefit attached to that income rider

17:51
hey fantastic but i i'm not sure i would

17:53
lead with it unless

17:55
it's just that important you to check

17:57
off that box but just remember

17:59
it's guaranteed issue meaning

18:02
it's not perfect coverage anytime

18:03
they're giving something away for free

18:05
it's not perfect and it's not great and

18:07
it's certainly not

18:08
as good as traditional long-term care so

18:11
let's talk about the fees again let's go

18:12
over the income rider fees

18:14
most and they're all different of course

18:15
and the annuity companies are all

18:17
different

18:17
um let's just say most income riders

18:19
attach to

18:21
uh indexed annuities around the one

18:23
percent it could be a little bit more a

18:24
little bit less but let's just say it's

18:25
one percent

18:26
and that's taken out of the accumulation

18:28
value so the other thing that people

18:30
never talk about agents never talk about

18:33
um

18:33
most of these writers have a percentage

18:35
that they grow by that's

18:37
that's the bad chicken dinner seminar

18:38
seminar pitch of i can get you seven

18:40
percent or eight percent no

18:42
that's the growth on the income rider

18:43
side that's monopoly money

18:45
but also look at this it's also

18:47
increasing the fee

18:49
by that amount with a lot of these

18:51
income riders not all but a lot of these

18:53
income riders

18:54
um as it grows so in other words if you

18:56
had

18:57
a hundred thousand dollars to put it

18:59
into an income rider and the income

19:01
rider's growing at seven point two

19:02
percent

19:04
and the the fee was one percent on that

19:06
income rider

19:07
that fee is going to grow by seven point

19:09
two percent so if you waited 10 years

19:10
that fee when you lock in and turn on

19:12
the income stream would now be 2

19:14
if that makes sense if it doesn't

19:16
schedule call i'll go over that with you

19:18
bottom line is don't just watch

19:21
that that jimmy carter type interest

19:24
rate grow because it's not

19:25
interest it's monopoly money and and

19:28
it's it's a phantom account

19:30
and so the question i got to call the

19:31
other day you know guy has an income

19:33
right he bought it from someone else i

19:34
have no idea why can you even imagine

19:36
anyone on the planet buying an annuity

19:39
other than from standing annuity men in

19:41
his fantastic team

19:42
i mean literally it's a horror story but

19:44
anyway i was talking to him and he goes

19:45
so when should i turn on the income

19:48
rider

19:49
so my question is do you need income

19:50
yeah i do need income standing nudity

19:52
man america's annuity agent

19:53
well then turn it on turn it on remember

19:57
that with even with income riders

19:59
all lifetime income guaranteed products

20:01
with annuities

20:03
you know you're getting your money back

20:04
with interest when you turn on the life

20:06
lifetime income stream

20:07
the true value proposition of any

20:09
lifetime income

20:10
strategy with annuities whether it's a

20:12
single premium immediate annuity

20:14
a deferred income annuity a qualified

20:16
longevity annuity contract

20:18
or an income writer the true value

20:21
proposition is when the

20:23
account is at zero because when it's at

20:26
zero and you're saying wait a minute

20:27
wait a minute stan what

20:29
when the account's at zero you're in the

20:31
annuity company's pockets

20:33
and they're still on the hook to pay up

20:35
until then you're getting your money

20:37
back with interest

20:37
you're transferring the risk so i'm

20:39
telling people all the time you should

20:41
transfer the risk

20:42
transfer the risk to the annuity company

20:44
to pay you for the rest of your life or

20:45
if you set it up joint

20:46
with a spouse or partner pay that you

20:48
and them for the rest of their lives

20:50
so if you pass away the money continues

20:52
uninterrupted and unchanged for the

20:54
for the uh the spouse or partner i mean

20:57
turn it on it's the same question that

21:00
someone says well should i take social

21:01
security

21:02
at 65 or should i take it at 70 well

21:06
not a good answer obviously the older

21:07
you are the higher the payment with

21:08
social security the older you are the

21:09
higher the payment with an annuity

21:11
uh for lifetime income including an

21:13
income rider

21:14
but you have to factor in those five

21:16
years or 60 months of payments that you

21:18
missed

21:19
while you're waiting for the higher

21:20
payment does it make more sense as i

21:22
tell my clients every single day

21:24
there's no u-hauls behind hearses you

21:26
can't take it with you

21:27
i need you to think about that for a

21:29
second pause

21:32
because you need to spend it you need to

21:34
live your life you've worked hard

21:36
it's all about lifestyle and i've got

21:38
hundreds of clients

21:39
that would give a million dollars to

21:41
feel good for a week

21:43
so i would encourage you to turn it on

21:46
here's the interesting part about income

21:47
riders

21:49
the industry loves it when agents sell

21:51
income writers and don't explain them as

21:53
and

21:54
i explain everything in depth and you

21:56
get the books and you have i have videos

21:57
at the stanley nude man youtube channel

21:59
and i do podcasts on

22:00
like this i'm educating everybody

22:02
because i want you to understand the

22:04
good and the bad the limitations

22:06
and the benefits of every single product

22:08
and in this case

22:09
income writers but most people

22:12
are under the assumption when they're

22:14
sold by somebody else

22:16
that they're getting jimmy carter yield

22:18
and they like watching it grow

22:20
but they're watching monopoly money grow

22:22
they're watching a phantom account grow

22:23
they're watching an account they can't

22:25
access

22:26
a lump sum or peel off the interest the

22:28
only way to access it

22:29
is to turn on the income stream and by

22:30
the way when that guaranteed

22:33
yeah that interest rate is growing

22:34
during the deferral time period once you

22:36
turn on the income stream

22:37
that jimmy carter interest stops being

22:40
done

22:41
done so what i don't want you to do is

22:44
become enamored with that growth

22:46
i want you to turn it on sooner than

22:48
later i want you to tell me

22:50
hey we need income in seven years and we

22:53
i'd rather you say we need income in

22:55
seven years and we need it to be two

22:56
thousand dollars

22:58
per uh for per month for the rest of our

23:01
lives

23:02
period we can reverse engineer that

23:03
quote or you can say hey i've got 225

23:05
thousand dollars we're going to defer it

23:07
for nine years me and the wife how much

23:09
lifetime income can we get from an

23:10
income rider we can do that

23:12
either way you're in control and you can

23:14
customize the quote

23:16
one more one more key thing i want to

23:18
talk about is inflation and income

23:19
riders

23:20
there are a couple of products and a lot

23:22
of rogue agents out there

23:23
good people i'm sure and i'm sure their

23:25
wife makes a really nice peach cobbler

23:27
but they're they're misinforming people

23:29
by saying well

23:30
if you buy my index annuity with my

23:32
income rider

23:33
every time the index goes up the the uh

23:37
the income increases by that amount so

23:39
if the index goes up three percent or

23:41
three point four percent

23:42
then you're going to get 3.4 increase on

23:45
your income

23:46
sounds fantastic that's beautiful that's

23:49
exactly what i'm looking for stanley

23:51
annuity man

23:53
uh annuity companies have the big

23:54
buildings for a reason

23:56
anytime without exception that an agent

23:59
says to you

24:00
well my index annuity with my income

24:03
rider

24:04
and when the index goes up it increases

24:06
the income stream by that amount

24:08
the annuity company is severely

24:11
and drastically lowering that initial

24:13
payment to make up for that

24:15
potential increase i mean to

24:18
typically it's a six to nine year break

24:21
even point if you chose the one with a

24:23
static you know the same income amount

24:26
for the rest of your life as compared to

24:28
one that could possibly

24:30
increase with the unicorns and the

24:31
butterflies chasing themselves and

24:33
eating at a buffet

24:34
that serves milk and honey no

24:37
never by potential you remember living

24:40
the reality not the dream that's the

24:42
that's the fun with annuities motto

24:44
living the contractual reality you own

24:46
an annuity for what it will do not what

24:48
it might do

24:49
and with income riders buy the stake not

24:52
the sizzle

24:53
because you're gonna own the contractual

24:55
realities not the dream that's being

24:57
pitched

24:57
so when you when you're shopping with me

25:00
stand the annuity man

25:01
for the best income writers we're going

25:02
to look at the highest contractual

25:04
guarantees available

25:05
and then i'm going to step in as the as

25:08
the

25:09
top agent on the planet that know that's

25:11
forgotten more than most

25:12
agents will ever know and i've been

25:15
around the block a little bit so i can

25:17
read balance sheets i'm going to tell

25:18
you if that carrier can back up the

25:19
claims

25:20
okay if they can do that and speaking of

25:23
that now

25:23
fixed and fixed index annuities with

25:25
income writers or fixed annuities in

25:27
general

25:27
are all have some some backing at the

25:29
state guarantee

25:30
fund level so each each state has what's

25:33
called a state guarantee fund

25:35
here's what you need to know about

25:36
income riders state guarantee funds

25:39
don't back up

25:40
income riders they back up the

25:41
accumulation value so going back to the

25:43
draw the line down the middle of a page

25:46
you know remember that

25:48
right hand side is the income rider side

25:49
left hand side is that accumulation

25:51
value side

25:52
the accumulation value side is is what's

25:55
covered by the state guarantee fund

25:57
hello now you need to know that which

26:00
which leads to you shouldn't make any

26:01
decision on an annuity based on state

26:03
guarantee funds

26:04
you make the decision on buying an

26:06
annuity or an income rider

26:08
based on the claims paying ability of

26:10
the carrier and i have skin in the game

26:12
with that i'm not going to put you in

26:14
front of

26:15
or recommend a carrier that i do not

26:17
think can back up the claims

26:19
you know i go in there and look at the

26:20
bond holdings and the solvency ratio

26:22
and i can tell when the son-in-law is

26:23
buying the bonds i mean it's pretty

26:25
obvious for someone

26:26
like me who worked at morgan stanley and

26:28
ubs paint weather paint webber and dean

26:30
witter

26:31
been there done that can look at it and

26:32
glance and tell

26:34
in a nanosecond once when they're in

26:36
trouble and they're buying bonds

26:37
improperly

26:38
and wall street's kind of taking

26:39
advantage of them

26:41
so let's kind of synopsize the income

26:43
rider thing first of all remember income

26:45
rider is a

26:46
future pension that you set up but it's

26:49
flexible

26:50
you can have it in your ira your non-ira

26:52
your roth ira okay

26:54
you can you can start and stop the

26:56
income stream if you want

26:57
you know you can do that or you can

26:59
change the start date so let's just go

27:01
you you signed the paperwork the plan

27:03
was to turn it on in 10 years

27:05
and you got to year 7 and you wanted to

27:07
start the income sooner you can do that

27:08
or if you got to year 10 and said yeah

27:10
let's push it two more years we'll start

27:12
in year 12 you can do that remember

27:14
the pricing of life lifetime income is

27:17
primarily based

27:18
on your life expectancy at the time you

27:21
take the payment or life expectancies if

27:23
it's joint

27:24
interest rates play a secondary role let

27:27
me say it again

27:27
interest rates play a secondary role i'm

27:30
going to say it again

27:31
interest rates play a secondary role do

27:34
not come to me

27:35
and say well i'm waiting on interest

27:36
rates to rise because

27:38
listen life expectancy drives the

27:40
pricing train

27:42
and interest rates would have to

27:45
significantly

27:46
move higher for it to move the move the

27:49
pricing needle

27:50
you can't time it and that's not a sales

27:52
pitch it's just not

27:54
you have as much risk of life expectancy

27:56
tables changing against you

27:58
as interest rates in my opinion so i've

28:01
been hearing for the at the time of this

28:02
taping for the last five years i've

28:04
heard the following

28:05
well i'm just waiting on interest rates

28:07
the rise because they have to rise

28:08
they don't have to rise okay we've been

28:11
proven that can they go lower

28:13
damn right they can't excuse my french

28:15
yes they can

28:16
i hope i'm wrong i want to go on record

28:19
that i'm wrong about

28:20
interest rates okay but i'm telling you

28:22
don't

28:23
base your decision on timing interest

28:25
rate you're not master of the universe

28:27
you're not gordon gekko okay you don't

28:29
know when

28:30
interest rates are going to move i don't

28:32
know nobody knows and if they knew you

28:34
wouldn't know because they wouldn't tell

28:35
you

28:36
period so income riders are a great

28:39
future pension product

28:41
period they're flexible uh the fees come

28:44
out of the accumulation value

28:46
you can buy some of them with

28:47
confinement care type benefits that will

28:49
double the payment

28:50
if you get sick or have to go into a

28:51
nursing home etc but all of those are

28:54
different we can walk you through those

28:55
if that's what you want to do

28:56
remember that the income rider

28:59
percentage that's growing by is not

29:01
real yield jimmy carter's not in office

29:03
that's not some genius an annuity

29:05
company figuring out how to give you

29:06
seven percent yield on a one on a one

29:08
percent ten year treasury it does

29:10
but it does grow by that amount only for

29:13
use for

29:14
to calculate your first lifetime income

29:15
payment i think income riders are great

29:18
um you know we probably sell more of

29:20
them than anybody in the country we sell

29:21
them properly

29:23
people understand that as monopoly

29:25
monopoly money and fathom account

29:27
but they're using it for future pension

29:29
they're using that as part as

29:30
part of their income floor in

29:31
combination with the pension if they're

29:33
so fortunate to have one

29:34
and social security and any other type

29:37
of monthly income that's coming

29:38
in every single month as long as you're

29:40
breathing

29:41
so in a pensionless world where you know

29:44
less than 10 percent of private

29:45
companies

29:46
offer pensions and with 10 000 baby

29:48
boomers reaching age 65

29:50
every single day people are looking for

29:53
income rider or guaranteed income growth

29:57
income riders are just the most flexible

30:00
lifetime income strategy available

30:03
in the world of annuities and

30:05
fortunately we represent all carriers so

30:06
we're going to quote all carriers for

30:08
the highest contractual guarantee

30:10
pretty much all carry i think there's

30:11
one or two that that we don't and that's

30:13
our choice

30:14
so um you know with that being said

30:17
i would encourage you to do a couple of

30:19
things go to my site the annuityman.com

30:22
request an income writer quote request

30:24
it we will get it to you in less than 24

30:26
hours

30:26
um request my books fill out your

30:29
shipping address i'll ship it to you no

30:30
obligation and for free

30:32
and schedule a call with me stand the

30:33
annuity man i know i sound crazy on this

30:35
podcast

30:36
i'm happy i think annuities are great i

30:38
think people need to know the truth

30:39
about them i think people need more

30:41
contractual guarantees and i think

30:42
people need to transfer risk

30:44
and that's the reason we call it fun

30:45
with annuities but i also say you know

30:47
we're living the reality not the dream

30:50
and the reality it's crack contractual

30:52
guarantees and with income riders those

30:54
are contractual guarantees that you can

30:56
bank on

30:57
for future income pension needs that you

30:59
can never outlive

31:01
so with that i'm glad you join me this

31:04
is a weekly podcast and so i'll see you

31:06
on next week's fun with annuities

31:08
my name is stan the annuity man

31:16
thanks for listening to fun with

31:18
annuities please hit the subscribe

31:20
button and make sure to go to my site

31:22
at the annuityman.com where you can run

31:25
your own spea dia and culat

31:27
quotes and see a live feed of the best

31:30
micah fix rates

31:31
in the country and even get indexed and

31:33
income writer quotes as well

31:35
you can also sign up for my six annuity

31:38
owner's manual books and i'll ship them

31:40
for free

31:41
and under no obligation i also encourage

31:44
you to schedule a one-on-one call with

31:46
me

31:47
stand the annuity man so we can have a

31:49
full discussion

31:50
of your specific situation it will be

31:52
the best

31:53
brutally factual and truthful advice you

31:56
will ever get and that's one guarantee

31:59
you should definitely take advantage of

32:00
so join me next time for the number one

32:03
annuity podcast

32:04
on the planet fun with annuities

32:21
you