089 Mr. FIA-X: The Empty Promises Behind Fixed Index Annuities

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welcome to fun with annuities with your

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host me stan the annuity man america's

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annuity agent can annuities be fun can

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contractual guarantees be fun

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absolutely they can find out the brutal

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facts about annuities with no sales

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pitches or high pressure nonsense just

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the brutal and factual annuity truth

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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 start right now

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[Music]

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welcome to fun with annuities i'm your

0:41
host stan the annuity man america's

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annuity agent and yes as you know

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license in all 50 states i encourage you

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to go to the annuityman.com and get my

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books run quotes schedule call with me

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and all that stuff

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i want to uh welcome everyone on all

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major podcast platforms that's listening

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to

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this as you're driving and or if you're

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on a treadmill i don't like you because

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you're making me look bad

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but and we also have a youtube channel

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called fun with annuities if you want to

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see my face you can't see our guest face

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because he's wearing a mask yes backed

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by popular demand

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and one of the most hated people other

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than me in the annuity industry mr f i a

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x welcome mr fiax how are you i'm good

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bye good morning an afternoon for

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everybody

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don't give away you don't give away

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where you're sitting you know that that

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people are trying to figure out who mr

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f-i-a-x is

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have they been donating to the uh pot

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um you know there should be an ongoing

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like

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a pot for if someone actually guesses

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your name which of course i will never

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admit to

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but um you know it is what it is once

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again we are talking about fixed indexed

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annuities indexed annuities from

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formerly called equity index annuities

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designed in 1995 to compete with cd

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returns and gold guess what that's what

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they do but one of the most over hyped

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oversold over promised sociopath

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products on the planet if bernie madoff

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was alive and out of jail he would have

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chosen

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indexed annuities to to push because

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it's a sociopath's dream you can promise

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anything you can promise absolutely

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anything

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and no one's ever going to get mad

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because it's a fixed annuity you're not

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gonna lose money it literally is

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you know the ted bundy annuity package

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and but but with that being said

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i sell more index annuities than most

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people on the planet i like them as a

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delivery system for income rider

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guarantees and

2:37
cd type or a little bit more than cd

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type returns with that mr fiax what do

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you what's happening out there since the

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last time we talked i know that you're

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you know you're in the inner circle

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you're at the meetings that nobody else

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can get into what's going on in the

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indexed annuity world

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let's talk about the end of the year

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because this is when everyone has to

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qualify for their trip and their perks

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and their bonus and the extra cash and

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the soft dollars and the under the table

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and the where do you want me to start

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well and i always tell people if

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someone's showing you one indexed

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annuity and they say this one's the best

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one for you that means they're going on

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a trip to spain with their girlfriend

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and or boyfriend and or spouse whichever

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one they choose

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or if they write enough they'll send all

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together so there you go

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it all depends i mean it is the end of

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the year and and that's something you

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know

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a lot of these companies operate off of

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a calendar a true calendar year january

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to

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to december right

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and then they have this limited time of

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to make qualifications for certain

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things surface certain bonuses a lot of

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the companies give them uh marketing

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dollars reimbursements um

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and they have to hit a number

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to get there

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so

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this might not be in your best interest

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but it's certainly in their best

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interest

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and i can say this unequivocally stan

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doesn't go on trips

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20 years ago i don't i don't and if and

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if i qualify for them and my family sees

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the destination and they go you know

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what

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um dad can we go i typically send my

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family which really makes the ceo mad

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because they're looking for stan the

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annuity man and they meet my daughter

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yeah

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they don't i mean

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the the reality is this is what's

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happening at the end of the year i know

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you know so they've got to make their

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quota they have to make their stuff

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they've trauma stuff to companies they

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then they have to deliver for the

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company to deliver back to them their

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bonuses their rewards and all these

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things are coming and and there's a lot

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of money getting ready to exchange hands

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in the next 10 days

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yeah it's pretty scary i'm getting a lot

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of calls from people that are getting

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pitched the indexed annuity pitch the

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sales pitch which is

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just as i'm getting ready to say this

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everyone listening what i'm getting

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reset ready to say is not true okay or

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there's a hole in it you're going to get

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an upfront bonus mr jones you're going

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to get market upside with no downside

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you're going to get free long-term care

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and you're going to get a lifetime

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income stream with this income rider

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only one of those things are true the

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lifetime income stream with the income

5:12
rider but if that is your goal then we

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have to shop

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all carriers for the best lifetime

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income benefit writer on the planet and

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oh by the way the only person who has a

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calculator for for income writers uh

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that is available to the public quoting

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all carriers is yours truly the annuity

5:30
man you go go to the the annuityman.com

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and you can use all of our calculators

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biadia qlik income writer

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etc um you can see a live magazine but

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the reason we don't have a live indexed

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annuity feed is that the rules of the

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index option strategies can be changed

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at the discretion of the carrier so to

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put something up there is misleading

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um yeah what's good today won't be good

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in 30 days from now and and so let's

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let's focus on that because this isn't

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here comes the next sales pitch yeah

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ready for this one yes

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stan touched on this briefly so some

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carriers may not have put all their

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money in play

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some carriers may not have hit the

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numbers that they want so you're going

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to see

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a fire sale a bonus uh something it's so

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extreme right that nobody in their right

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mind would go

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well why would the company give away 20

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30 free money

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they're not

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so i know stan you always use that if

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you can't figure out who the sucker is

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in the room it's probably you

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well and i also say

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upfront bonuses is candy for the stupid

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it's like it's like going to the car

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dealership and buying a car for the

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stereo system you cannot be that stupid

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and i actually told someone that he goes

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well i got a 25 percent upfront bonus i

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said please tell me you're not that dumb

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please tell me you didn't make the

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decision and he's like yeah actually we

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did i'm like oh my gosh

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that's horrific mr fiax i'm excited for

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you to be on here obviously because

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you're so dynamic and good looking

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behind that mask the other reason is i

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want to dig into the gogo product right

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now and i mean index annuities have been

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around since 1995 since 2008 they've

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been like this

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sociopath one size fits all if you ever

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wanted to know where the the

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time share salesman went that got fired

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no offense to the timeshare salesman but

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the ones who got fired are now selling

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indexed annuities i'm not saying all

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people are bad in the industry but

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it does gravitate toward that person

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i'm hearing a lot mr fiax about buffer

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annuities and shield annuities and what

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i call co-pay annuities

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can we talk about that have you i'm sure

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that in your spare time you've looked

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into these monsters and and to me having

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been in the business a long long time

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this is what happens when interest rates

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are low and companies have to invent

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structured products out of midair to be

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profitable am i right about that

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instinctually well let's let's take this

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backwards a little bit because i think

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you're you're hitting something here

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let's go back to

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2006

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ish right around there but just before

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the crash right

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you know income riders are starting to

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come out

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and people were selling them and nobody

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ever looked at the income writer and

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understood really explained it they just

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said you get a seven percent guarantee

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and blah blah blah and you and i both

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know you don't get a seven percent

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guarantee you get a fictitious number

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that rolls up that dictates your income

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and it's just what it works yeah that's

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not interest i always tell people that's

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not interest jimmy carter is building

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houses in georgia hopefully at age 95 at

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the time of this taping

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there is no such thing as that even

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though people call me every single day

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and say i bought a seven percent annuity

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i bought an eight percent annuity and

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that doesn't make it bad no it just

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makes it that the you either

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misunderstood

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or the agent misunderstood and didn't

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explain it correctly i'm going with the

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latter more often than not exactly then

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they definitely didn't know they did it

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and what was funny is because there's

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fees associated with those riders and

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then they would come out and what would

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happen is i'll never forget sitting with

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a group of people and they were all

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taking phone calls and and it was

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amazing that the clients were saying

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well my statement were negative and you

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told me that i can't lose any money in

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my annuity well you didn't lose any

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money they just took the fee out

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right which is still losing money in my

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book because how it all yeah

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it's it's it's

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it's less money and and by the way for

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people that just uh as a reminder

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mr fiax we cannot reveal his name

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because he's truly an indexed annuity

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insider he's been there from the

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beginning

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he's seen these products designed he's

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been at those tables and we certainly

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cannot

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tell people who he is and his voice is

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filtered and and it is it's messed with

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so you don't really know who he is and

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he is wearing a mask for the people

9:52
listening on the podcast and for the

9:54
people watching the youtube channel with

9:56
annuities he has a mask on but it's

9:58
because he needs to be protected because

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these are

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um

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these products the industry it's

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profitable for the industry this is what

10:07
agents sell primarily

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um and and we're just happy to have him

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on so let's go back into the the buffers

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and the shields and all these things i'm

10:15
going to walk right into that because

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cuz so the annuities when when the

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market crashed

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the the note was low the option cost was

10:23
very high and made the tracks incredibly

10:25
unattractive right

10:27
who wants to go get a three percent

10:28
count

10:29
and when you buy it you're going to be

10:30
stuck there forever because it's never

10:32
going up correct

10:34
you're stuck so they came out with that

10:36
income riders feel and went here you go

10:38
and they built this huge story behind it

10:40
right

10:41
now i'm going to say this and and stand

10:44
you know i know you sell income riders

10:46
and we're for it i do not every single

10:48
person in the world needs an income

10:50
rider no doubt no doubt about it but

10:53
probably 95 of these products are sold

10:56
with

10:56
income riders right but they don't need

10:59
them so they created this story and now

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guess what we've kind of been in japan

11:04
haven't we the 10-year note really

11:06
hasn't moved the rates have stayed

11:08
relatively low markets doing okay but

11:10
the rates have stayed relatively low so

11:12
they've got to come up with a new

11:14
story right we haven't had a new story

11:16
for 13 years

11:18
so here's the new story the new story is

11:20
now your your your ryla your copay

11:23
annuity what you're talking about and i

11:25
did do a little digging so basically

11:27
what they're saying is if you're willing

11:28
to absorb some of the loss

11:30
we'll let you play for a little bit more

11:33
sounds fair so let's let's put that in

11:35
english a little bit and even even

11:38
dumber english which is the english that

11:39
i live in

11:40
so what you're saying is you get a

11:42
little bit more upside on the index

11:44
option but you're going to share in the

11:46
downside if it passes a certain

11:48
percentage

11:50
up to

11:51
whatever your threshold is it could be

11:52
you know 5 10 15 25 wherever you think

11:56
your risk tolerance is 25 on the

11:58
downside 10 on the downside 5 on the

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downside and then they adjust the

12:02
annuity companies have the big buildings

12:03
for reason they adjust the upside based

12:05
upon how much risk you're willing to

12:07
shoulder

12:08
and in a bull market mr f i a x

12:12
this is a no-brainer dart throw as from

12:14
a sales pitch standpoint right oh it

12:17
sounds amazing because oh look we're

12:20
going we're going to score you can keep

12:21
going up and people forget i always call

12:24
it investor amnesia because that's what

12:26
they have they all forget about we've

12:27
all forgotten about 0.708

12:30
everybody's forgot about that but here's

12:32
the purpose of annuities you buy them

12:34
why for contractual guarantees

12:36
so i don't risk my money you buy then

12:38
why so i have guaranteed payments that i

12:40
can never outlive yes if you're gonna

12:43
take the risk

12:45
well then

12:46
go take the risk and get all of it and

12:47
here's why i say that and i'm not giving

12:49
investment advice i'm not saying that

12:51
but i was looking through some

12:53
literature of one of the top companies

12:54
that sell this

12:56
and

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if you chose one of their

13:00
choices of the risk tolerance or their

13:02
most crazy deepest risk you can take

13:05
right swing for the fence right right 99

13:08
over 99 of the time it never happens

13:12
so you're hedging for less than one

13:14
percent

13:15
the story that they're catching

13:18
that's in their literature that was in

13:19
their literature yeah so you're

13:22
somewhere you're somewhere between

13:25
looking at all of it it happens between

13:26
about 94 and 99 percent of the time a

13:29
little over 99 of time

13:31
what they're telling you to worry about

13:33
never happens

13:36
and they can change the rules yeah so i

13:38
don't understand why that sounds so

13:41
attractive to me this isn't going to

13:42
happen 99 of the time

13:44
what do i need you for

13:47
well and this falls under

13:49
the ryla's you hear the registered index

13:52
products that are out there

13:54
um and i just call them copay annuities

13:56
because

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you know i've been in the business a

13:59
long time i was with ubs morgan stanley

14:01
payne weber and ubs i know dean witter

14:04
um they're all the same so the names

14:05
don't mean anything but but there's such

14:08
a thing called margin call and there's

14:10
not many people in the world

14:13
that really really understand margin and

14:16
when i was a broker an investment

14:18
advisor a master of the universe mr fiax

14:22
i i had to do an iq check on people that

14:25
i would allow to use margin

14:28
now

14:29
the copay annuities that we're talking

14:31
about are not you're not getting a

14:32
margin call

14:34
but it's pretty darn close i never

14:37
thought there would be an annuity with a

14:39
margin call

14:40
but if the let's just say your buffer on

14:42
the downside you chose is 10 percent

14:45
and the market goes down 22

14:48
hmm

14:49
they're going to take it out of

14:50
somewhere you don't have to come up with

14:51
the money but they're going to take it

14:52
out of your account am i right so why

14:55
wouldn't you just do this let's just say

14:57
i put my money in the market and when

14:59
the market went down 10 i just sold my

15:01
position and waited

15:04
i agree i i just i don't

15:06
i mean this this could be and i know i'm

15:08
gonna eat hate mail bring it on let me

15:10
just tell

15:14
well you don't get it because no one

15:14
doesn't know where to send it but here's

15:16
the thing

15:17
um

15:18
this is a consumer

15:20
podcast this is not for advisors and

15:22
agents but those guys and gals

15:25
all listen

15:26
bring it on

15:28
bring it on and i will factually fillet

15:30
you like a flounder because you you know

15:33
instinctually advisors that what what mr

15:36
fiax and i are saying

15:39
is true

15:40
it's absolutely true so the question i

15:43
have from a fiduciary standpoint

15:46
mr fiax is

15:48
how is this in the best interest of the

15:50
client

15:51
well i don't know how a lot of things

15:52
would get done in our industry with a

15:54
fiduciary standard in the best interest

15:56
of our client but i'm going to tell you

15:57
something real funny about this

15:59
when agents are selling if i'm a

16:02
registered rep

16:03
okay so i have a 65 i have a fiduciary

16:06
obligation to the client what that means

16:07
is

16:08
you

16:09
you and your needs are above all

16:11
and that should be by the way let's stop

16:13
for a second

16:14
that should be a given if you're in the

16:16
financial advice business

16:18
you should be a fiduciary because you're

16:21
in the financial advice business i did

16:23
not know that we needed to have a rule

16:25
passed by congress to tell us that we

16:27
should look out for your best interest

16:29
unbelievable handling your money

16:30
unbelievable but i digress so let's go

16:33
backwards

16:34
when your fiduciary

16:36
is operating in

16:38
in an insurance capacity

16:42
he no longer has to wear the fiduciary

16:44
hat

16:46
he's not selling he's selling a fixed

16:48
product so what that what i really makes

16:50
me upset where i get a little angry is

16:52
when these people sit there and say oh

16:53
i'm a fiduciary buy this indexed annuity

16:55
because i'm a fiduciary

16:57
huh what they need to tell you is i'm no

16:59
longer operating in that fiduciary

17:00
capacity

17:02
well and the other thing and we have

17:04
talked about this before but let's let's

17:05
bring it up now because these products

17:08
that are out there now

17:09
they can pay a built-in commission and

17:11
just heads up on all commercial annuity

17:14
products like this

17:15
you know there's a built-in commission

17:16
that's paid from the reserves of the

17:18
annuity company and you see a net

17:19
transaction but but trust me that agent

17:21
is getting paid so don't let him get

17:23
away from it with word games and

17:24
semantic sales play and there's nothing

17:27
wrong with that nothing

17:29
nothing wrong but here's my point here's

17:31
my point i don't want hate mail because

17:33
we're talking about commissions we

17:35
everyone needs to get paid everyone

17:37
needs to get paid fairly they need to

17:38
service the contract for for the term of

17:41
the contract the life of the contract

17:43
i'm i'm

17:45
but they should never ever ever ever

17:48
ever ever

17:50
charge a rap fee or a management fee on

17:52
any of these buffer shield ryla

17:55
index annuity products when i see that

17:58
what are they managing i cannot imagine

18:01
how that gets past their compliance

18:03
within the firm because they're not

18:05
managing anything

18:07
they're buying an index option that

18:08
resets on a contractual anniversary

18:10
basis if it's a one-year option if it's

18:12
a two-year option that's resets on the

18:14
two-year

18:15
et cetera

18:16
they're not managing jack

18:19
so if someone is saying i want you to

18:21
buy this and no offense to any of these

18:23
companies love these companies love them

18:25
hug them

18:26
the products is what we have the product

18:29
strategy is what we're having a problem

18:30
with you you should never ever be

18:32
allowed to wrap that now

18:34
in charge an annual fee for managing the

18:37
asset that's garbage that's like i think

18:39
you brought it one time mr fix somebody

18:42
managing a municipal bond portfolio that

18:44
was kind of a set it and forget it bond

18:45
portfolio you talk

18:47
indexed annuities

18:49
these buffer annuities copay annuities

18:51
are set it and forget it okay there is

18:55
no annual oversea of the proc and if

18:58
someone tries to do that and get it walk

19:00
out just get up and walk out here's that

19:02
there's going to be an argument here's

19:04
going to be the argument to that i'm

19:05
going to play the agent all right we're

19:07
going to do hate mail live on tv right

19:10
here we go they're gonna say well once a

19:12
year on your annual review we have to go

19:13
over your stuff and we might need to

19:15
reallocate stuff and put it in a

19:17
different strategy so actually

19:18
technically i'm i'm managing this and

19:20
paying attention to it on an annual

19:22
basis for you

19:24
right and you were compensated for that

19:27
all up front

19:28
right

19:30
so that argument doesn't hold water for

19:31
all the agents listening and i know you

19:33
are they're gonna say well i review my

19:34
clients every year and blah blah blah

19:36
you got paid up front for it and if they

19:39
don't they take a trail which means they

19:41
get paid every year on it so you're

19:43
getting paid every year absolutely so

19:45
the agents need to quit their whining

19:47
and

19:49
for the folks listening the the

19:50
consumers will call them yes you have no

19:53
idea how many agents listen to this

19:56
right we have a lot of people in our

19:58
industry listening to what we're saying

20:01
absolutely and and the last time we kind

20:03
of briefly covered this i'm glad we're

20:04
drilling down on it now because i'm

20:05
starting to see those ads all over the

20:08
place

20:09
oh just wait until next year because i'm

20:11
going to i want to get into next year

20:12
because we're still finishing this year

20:15
we're trying to tell you what you're

20:16
going to see january 1st but yeah unless

20:19
right now let's finish this up real

20:20
quick i know for a fact there will be

20:22
two

20:23
head of the annuity divisions from

20:25
specific brokers that are going to

20:27
contact me because they did the last

20:29
time that we covered this because it

20:30
blew up a lot of their sales because

20:32
they're still arguing with me that yes

20:34
there is a valid reason for us to charge

20:37
an annual rap fee for that there is no

20:39
value the only valid reason is the fact

20:42
is and i told them this and these are

20:44
these are grand poobahs of these places

20:46
but they know i'm not playing i said

20:47
listen the only reason that you're

20:48
wrapping it so you can so you can look

20:50
at future revenue revenue that you can

20:53
project future revenue anything else in

20:54
that you're lying and you convince

20:57
yourself it's like george costanza said

20:59
on seinfeld if you believe it's the

21:00
truth then it's not a lie a lot of these

21:02
people that are just convincing

21:04
themselves that it makes sense for them

21:06
to wrap these these the bottom line

21:08
let's let's kind of type the bow on the

21:10
buffers and all these other copay

21:12
annuities and all this other stuff that

21:14
seems so wonderful but yet you're

21:16
sharing in some of the downside

21:18
i'm gonna let me let me tie it up and

21:21
i'll let you tie it up

21:23
if it sounds too good to be true it is

21:24
every single time and they can change

21:27
the rules

21:28
at their discretion at the they mean the

21:31
annuity company can change the rules at

21:33
their discretion

21:34
okay and these are cd products

21:37
they're not market i don't care what

21:39
anyone says

21:40
if you want market returns don't buy an

21:42
annuity and yes for your variable

21:44
annuity people out there i understand

21:46
you got mutual funds and this bull

21:47
market is doing great but you're still

21:49
limited with your choices and in my

21:52
opinion if you're limited with your

21:53
choices whether it's an indexed annuity

21:55
or a variable annuity that's not a

21:56
market product market products have

21:58
unlimited upside unlimited choices well

22:01
let's let's talk about that real quick

22:03
talk about the variable annuity when you

22:04
start putting riders on it whether it be

22:06
death benefit income or any type of

22:09
thing

22:10
picture picture of the universe and then

22:12
every other writer you add that just

22:13
keeps squeezing your universe smaller

22:14
and smaller and smaller and smaller and

22:16
so that you are limited in choices you

22:18
can't argue that let's go variable

22:20
people will argue that with you all day

22:21
long you get limited choices when you

22:23
pick certain things they keep narrowing

22:25
the scope down they're not going to

22:27
shelter your downside and let you swing

22:28
for the fence on the upside

22:30
by the way they're going to charge you a

22:32
real hefty fee for all of it on top of

22:33
that well and i have nothing against

22:35
variable annuities there are some that

22:37
when they're originally designed and

22:38
introduced in 1955 i think that was the

22:41
date um it was by tiaa by the way used

22:44
to be called tia crew it was for

22:47
tax tax deferred market growth using

22:49
mutual funds they call them separate

22:51
accounts okay but the but the load

22:53
mutual funds the ones with m e mortality

22:55
and expense fees and mutual fund fees

22:58
the average annual fee for the life of

23:01
the policy is is average is around three

23:03
percent yes it could be lower yes it

23:05
could be higher but that means you're

23:06
starting each year out at minus three

23:09
on the accumulation value and you have a

23:11
limited choice of mutual funds in

23:14
addition to that

23:15
the income writers that are attached to

23:17
variable annuities historically do not

23:19
outperform contractually the same type

23:21
of income riders attached to fixed

23:23
annuities and i you know full disclosure

23:25
i do not sell variable annuities because

23:27
i don't sell anything that has the

23:28
potential to go down in value and

23:30
because i'm

23:31
strictly focused on contractual

23:32
guarantees i have to go with the income

23:34
riders that provide the highest

23:36
contractual guarantee and those are

23:38
fixed so

23:40
you know shooting that down once more

23:42
get let's go to january let's go to 2022

23:45
so we've already warned people that

23:46
people are going to try to hit their end

23:48
of the year numbers and there's buyer

23:49
sales and bonuses and all that stuff in

23:51
the year let's go into 2022 which i

23:53
think

23:54
is going to be an interesting year for

23:55
indexed annuities historic sales because

23:58
now the bank channels and the brokerage

24:00
channels are now selling them to

24:02
everybody

24:05
well which leads to the question is if

24:06
you're going to have an advisor to

24:08
manage your money why are you having to

24:09
buy you a package product

24:15
i mean having been a master of the

24:17
university of these big firms before the

24:19
packaged products were there you're

24:20
literally managing the asset and if you

24:23
really want that person fee only

24:25
hopefully to manage that asset then

24:28
they're all in they're looking at

24:29
they're not packaging things up and

24:31
selling it to you

24:33
well that's a whole other topic there

24:35
where the guys a lot of these guys don't

24:37
manage their own money they just sweep

24:38
it up in like a big room and they send

24:40
it off to somebody and someone else

24:41
manages it and they they get a fee and

24:43
they get a fee and they and you pay it

24:45
off so

24:46
here's here's 20 22 you're right 2022

24:49
this is my karnak clairvoyant vision

24:51
moment let's do it you're gonna see

24:53
you'll see a lot of the carriers open up

24:55
with a fire sale some sort of huge crazy

24:58
bonus because they want to get the pipe

25:00
full and start moving and getting

25:02
everything going so for 30 days 30 days

25:05
only come get it you'll get an extra 20

25:07
25 30 bonus on your stuff look at your

25:10
income accountable from 100 to 130 000

25:13
day one immediately

25:15
back to what we talked about towards the

25:17
end of the year blah blah blah it's all

25:19
noise and if you get distracted by the

25:21
noise

25:22
then you are what pt barnum called the

25:24
sucker that's you

25:26
and i think the pr the the proliferation

25:29
of the bad chicken expensive steak

25:31
dinner seminar

25:33
invites are going to go wild in the

25:35
first quarter be careful you're going to

25:36
gain a lot of weight because i always

25:38
tell people swallow the food not the

25:40
sales pitch yeah you're going to eat

25:42
well um yeah i think you know depending

25:44
we'll see how the rest of this winter

25:45
goes with this coven and what yeah

25:48
that's what i saw i saw california's

25:50
lockdown again a lot of the states are

25:51
doing mandates and doing all this stuff

25:53
again mass mandates etc um

25:56
you know so we'll we'll see um i think

25:59
the american people have had enough of

26:00
it and they're gonna go live their lives

26:02
and do what they do yeah but if it's

26:04
mandated that restaurants are the only

26:06
positive thing i said this a long time

26:08
ago that cove had brought to the table

26:10
was it shut down the bad chicken dinner

26:13
steak dinner seminar that was that was

26:15
an absolute positive you know i talked

26:16
to dc about it the coming out and say

26:18
hey a positive is it and they were like

26:20
no i don't think that's possible i'm

26:22
like yes it is a positive um but but the

26:25
indexed annuity

26:27
industry is still mr fix they're still

26:30
struggling with this low interest rate

26:32
environment from a pricing standpoint

26:33
right yeah it's hard because i mean the

26:35
products are backed by the notes and if

26:37
the if the interest rates are low and

26:39
and i'll give everybody a real all you

26:41
have to do is watch if the stock market

26:43
the s p because that's the benchmark

26:45
right if the s p is volatile i mean it's

26:47
going up and down a lot

26:48
option costs increase right correct okay

26:51
that's one component of how they price

26:53
this they have to go by options they

26:55
either have to go to an investment bank

26:56
or some companies have their own option

26:59
uh account their own they are their own

27:00
bank basically for options so they do it

27:02
themselves the second component is

27:06
the interest rate

27:08
okay what is that 10-year note doing

27:11
because that's what they tie it to

27:12
because they buy the 10-year note to

27:13
help guarantee the product and

27:15
whatever's left over they can go buy an

27:16
option costly so the lower the note is

27:19
the more money they have to sink into

27:20
the note less they have for an option

27:22
cost pretty simple so that's why your

27:24
caps come down that's why your fees go

27:26
up that's why all these

27:28
moving parts i mean they're just levers

27:30
and they told the levers to fix the

27:32
third component and this is the biggest

27:34
one and the clients don't know about

27:36
this at all is how much money does the

27:38
insurance company want to make what is a

27:40
my roi for investing in the annuity

27:43
right

27:44
okay so basically what they do is they

27:46
don't care what this is or what that is

27:48
they go what's my roi and then they work

27:50
backwards

27:51
we need to make x pre-tax

27:54
so you build me whatever you want as

27:56
long as it hits that target number

27:59
you know

28:00
pre-tax

28:01
and that's the reason some companies

28:03
offshore that's why you see some of

28:04
these companies in holding companies

28:05
offshore this and that so that that by

28:08
having that savings

28:10
because they don't have to they have

28:13
they're in a tax-free environment

28:14
that makes a big difference so

28:16
you see a lot of shelving with that and

28:19
a lot of movement and and that's the

28:21
three components how much am i going to

28:22
make is the insurance company pre-tax

28:25
what's the note doing what's the option

28:27
cost it's pretty simple for you and the

28:29
option costs to go back over that for

28:30
the listener is they either do that

28:32
in-house and that's that's a very

28:34
count them on your hand group and the

28:36
rest of them are hiring the goldmans and

28:37
the and

28:39
yeah they go to the investment bank and

28:40
we've talked about this a little bit

28:42
before and a lot of agents don't even

28:44
know this right they don't even have a

28:45
clue

28:46
they don't understand that when i buy an

28:48
option say i buy an option with a five

28:49
percent cap

28:51
right well they don't buy the options

28:53
unlimited it doesn't have a cap right

28:54
say my product does have a cap at five

28:56
percent well

28:58
anything above five percent

29:00
is useless so what do they do they sell

29:03
that upside back to the investment bank

29:06
and the investment bank will take that

29:08
wholeheartedly

29:09
and make some cash so the annuity

29:11
company is not not making that

29:13
additional upside they've already solved

29:14
they've already sold that off at a

29:16
premium correct that's gone yeah that's

29:17
gone from the very beginning i think

29:20
it's important for people to know how

29:22
the how the engine works because you

29:23
know agents typically don't know what

29:25
they're talking about when they talk

29:27
about index annuities they all think

29:28
it's a market product it's not just to

29:30
let people know it's not a security it's

29:32
a life insurance product issued and

29:34
regulated at the state level your state

29:36
level

29:37
um don't make them bad products but

29:39
they're cd products if you hear

29:42
the sales pitch say you will get market

29:45
like returns

29:47
take your money and run he doesn't know

29:49
what he's talking about yeah

29:51
he or she is just pushing the product

29:53
they are just

29:55
they're telling you a story because it

29:56
sounds good right okay right um

30:00
and it's important okay like one of the

30:03
great stories is oh we have this income

30:04
doubler and if you get sick and go to

30:06
the nursing home this is going to pay

30:07
out double your money to you when you're

30:10
in the nursing home

30:11
i know that sounds great you just spent

30:13
your money twice as fast you know what i

30:15
say when you get sicker you get your

30:17
money back quicker quicker because

30:19
everything everything in the south is a

30:20
rhyme you know i was doing rap a long

30:22
time ago mr mr fiax before rap was you

30:25
know very i should do annuity wraps

30:28
to explain all of this i think that

30:30
would

30:31
i think i think that would be good and

30:33
explain again once again to the to the

30:34
listener why most um

30:38
indexed annuities are on a on a long

30:40
term chassis a seven or nine or ten year

30:43
uh surrender charge time period is it

30:45
it's because of those index options

30:47
correct

30:48
there's a there's a few pieces to this

30:50
and i'll tell you a funny story that we

30:51
just worked on the other day we had a

30:53
client that says i want a seven-year

30:55
time frame

30:56
and the agent who you know be very savvy

31:00
great a great agent really gets the

31:02
business he showed him the difference

31:05
between seven and ten years and what

31:07
those extra three years for tying your

31:09
money up for the extra three years what

31:11
it meant for you

31:13
financially

31:15
long-term investments return more than

31:18
short term

31:19
so for this guy to hang on for the extra

31:21
three years would have been he could

31:23
have even

31:24
just

31:25
surrendered it he could turn in his

31:27
tenure around the same time frame

31:30
and have had more money

31:32
after paying the penalty he had more

31:34
money by buying the 10 why because you

31:36
get better pricing so you have less

31:39
friction in your product i get more

31:41
upside i get higher caps or higher

31:43
participation rates lower fees so don't

31:46
always let the time frame

31:49
gage you

31:50
look at it in in with an open mind some

31:52
people are just set and they go i want

31:54
seven or i want five right i want three

31:57
right you know what get the instead of

31:59
three go five quid in three and you're

32:01
ahead of the game

32:03
yeah

32:04
you have to analyze it and i and i tell

32:05
people if you're at five years then

32:07
amiga is going to win every single time

32:09
but if you're past that then then index

32:11
knew he's working by the way just uh

32:13
you know the the choices that i

32:15
make and pro and we use at the

32:18
annuityman.com for indexed annuity

32:20
accumulation those choices is someone

32:22
says stan i just want accumulation you

32:24
know i'm writing it by mr fiax because

32:27
he's got his finger on the pulse and he

32:28
has developed proprietary that he could

32:31
never share

32:32
spreadsheets that track all products

32:34
from all carriers and how they work

32:36
renewal rates etc if you want to say

32:38
who's my inside guy

32:40
it's it's him i want to transition from

32:42
that statement to

32:44
there are

32:45
there are one year and two-year and

32:47
three-year and four-year index options

32:50
when indexed annuities first started

32:51
back in the day with um

32:53
with uh

32:54
i said keystone but it's keyport i laugh

32:56
about that still keyport life those were

32:59
five year index call options and they

33:01
did very well at five seven and ten yeah

33:04
mr fix can you explain why

33:08
the three the two or three or four year

33:09
or five year i don't even think there's

33:11
any five-year index call options out

33:13
there on index and news but i know there

33:14
are some really good three-year ones why

33:16
those work better historically than the

33:19
one-year call option well it's cost i

33:21
i'll just break it down think of it um

33:25
pretty simple and basic is that if i'm

33:28
willing to commit for a longer term

33:31
you'll give me a break on the price

33:32
right

33:33
right that's i mean typically how things

33:35
go it's like i think of a membership if

33:37
you wanted to sign up online for a

33:39
membership the one month is more

33:41
expensive than the six months which is

33:43
more expensive than the one year which

33:44
but if i go three years i'll really give

33:46
you a discount right that's exactly what

33:48
they do so by by saving the money by

33:51
buying the cheaper option cost and they

33:54
save significantly about 50 50 60 on the

33:57
cost by saving all that money they can

34:00
take what they saved by the longer

34:02
duration and put it back in the product

34:04
to give more features and benefits or

34:07
better than that is

34:09
they can give you more upside

34:12
and i think like the two the two the two

34:15
that you did your research on and and

34:17
you showed us and we are showing

34:19
high iq people that that actually get it

34:22
and know that it's not

34:23
too good to be true from an accumulation

34:25
standpoint one was a two year option one

34:27
was a three year option on an indexed

34:29
annuity

34:30
and you know they have they have they

34:32
have worked out and when we explain that

34:35
using your verbiage people understand it

34:38
you just have to be grown up and patient

34:40
and the reason that most indexed

34:41
annuities have a one year call option is

34:44
most people aren't patient enough to to

34:46
hang in there

34:47
but it's it's a reflection of investing

34:49
as a whole

34:50
um you know though if you hang in there

34:52
long term you're going to do okay now

34:54
now i don't look at

34:56
index and news in investments i look at

34:57
them as transfer risk principle

34:59
protection products because worst case

35:00
scenario is you don't lose any money

35:02
okay well

35:04
i think the patient's thing is you know

35:05
warren buffett said that the stock

35:06
market's the you know from transferring

35:08
wealth from the inpatient to the patient

35:10
right that's that's what it is

35:12
and you're right people don't have the

35:15
patience

35:16
but the other side is is

35:18
the sales side we'll talk a little bit

35:20
about some psychology here for a second

35:22
is sure

35:23
you sell this on the one year and the

35:25
the the

35:27
the premise is it goes one year it locks

35:29
in and you never give it back

35:31
right

35:32
and then next year you compound off that

35:34
amount

35:35
well let's break this down real quick

35:38
that's factually kind of accurate so i

35:41
put it in for one year it goes up it

35:43
locks in next year when i renew first of

35:45
all i'm going to get compounded probably

35:47
with the lower rate why because the

35:49
insurance companies can adjust that cap

35:50
based off of

35:52
market conditions right

35:54
which i think is a bunch of crap in here

35:56
is why i'll say that because you bought

35:57
the 10 year note

35:59
it doesn't matter what that does you

36:00
already have that in your pocket so the

36:02
only thing that could really change is

36:03
the cost of the option correct

36:05
that is correct and the way that the

36:07
only moving part at that point

36:09
and so the annuity company is they

36:11
actually would you say mr fiax that they

36:15
prefer the one-year call option because

36:17
it's a little bit more profitable to

36:19
them because they can continue to resell

36:21
the upside to the investment banks

36:23
i think so i think so and here's why i

36:26
would say that too is is

36:28
if you use a longer term option

36:30
you do have to pay more money up front

36:32
it's more expensive in the short term to

36:35
buy a longer term option

36:37
but it's much less expensive over the

36:39
long term

36:40
and we saw a company kind of get their

36:43
honey in a buying back in 0708 with yeah

36:45
yeah

36:46
and they sold they they sold their

36:48
company to it to a bigger group and you

36:50
know who i'm talking about but yeah

36:52
and and it was because of the longer

36:54
duration on the option that was

36:56
that was what it was so back to where i

36:58
was and so the story stand was it's like

37:00
a ratchet remember the guy on dateline

37:02
when they did that he's swinging the

37:03
ratchet around and is right in the

37:05
seminar it only goes one way it can

37:07
never go backwards

37:09
there's a huge cost for that

37:12
and you are paying it with a cat

37:15
a lesser participation rate or a higher

37:17
spread

37:18
as the client you are gonna pay for that

37:22
okay if you take that longer duration

37:25
option yes you'll have a little bit of

37:27
up and down mm-hmm

37:29
but let me ask a question stan are

37:31
annuities sold for one years three years

37:33
four years five years 10 years 12 years

37:37
they're typically 10 9 10

37:39
yeah i mean indexed annuities went

37:41
through a a bad patch a few years back

37:43
where agents were selling 14 and 17-year

37:46
surrender charge products states stepped

37:48
in after a lot of complaints

37:51
and now most most um states

37:54
have 10 years as the as the longest

37:57
duration you can lock in i know there's

37:59
still still some states out there that

38:02
have there no limit so if someone's

38:04
pitching you a 17-year or 14-year

38:08
surrender charge product you can just

38:10
kind of figure out

38:11
what their commissions are commissions

38:13
are commensurate with the length of the

38:15
surrender charge time period you can

38:17
yeah

38:18
they've come down a little bit because

38:19
of the note but but here's where i'm

38:21
where i'm where i'm heading with that

38:22
which i think is

38:24
is important where i lost my train of

38:26
thought on that so there you go but the

38:28
the purpose of

38:31
that's of part that's all the partying

38:33
that you do by the way you're gonna get

38:34
that

38:35
come back to that because i do have a

38:36
question because before i forget it you

38:38
know we're in that age group that we we

38:40
are having cognitive decline

38:42
yeah for sure okay

38:43
i did a podcast recently with carrie

38:45
pector of retirement income journal and

38:47
he's talked about the bermuda triangle

38:49
of annuities where

38:50
where these these offshore

38:53
entities are purchasing blocks of

38:55
annuities

38:56
and he's not sounding the alarm but he's

39:00
pointing a flashlight at the roach

39:03
because this could get interesting do

39:05
you have a take on that i would love to

39:06
hear your insight on

39:08
what's happening with these bermuda

39:11
companies and companies from

39:13
outside the united states which means

39:15
they're not regulated which scares me

39:17
and you right well i

39:20
well the reason why they do it is what

39:21
we talked earlier it's all for the tax

39:22
savings

39:24
it juices their return from maybe 12 to

39:26
30 percent because they don't have a tax

39:29
they don't have a tax obligation because

39:30
they're they're offshore

39:32
should the should the consumer be

39:34
concerned carrie pector was

39:36
he was going in that direction tiptoeing

39:38
there and i understand why

39:41
um do you think there's there's some

39:43
exposure to that

39:46
i'm not there yet

39:47
but but and i really haven't dumped into

39:50
it too much but i i i see where he's

39:52
aiming and

39:54
you know what if things do go bad and

39:55
they're like well hell we're offshore

39:56
sorry

39:59
i know i know and i and i um but in my

40:02
my bigger thing to stan is is it and i

40:04
this is i think is very important for

40:06
the the consumers to understand there's

40:08
really kind of two kinds of companies

40:10
there's a stock company

40:12
and there's a mutual company

40:14
okay

40:15
stock companies have to report to

40:17
shareholders

40:19
meaning

40:20
boy we better do whatever we need to do

40:22
to juice up our share pricer right or

40:26
they're going to remove us right

40:28
you know it's like blazing saddles

40:30
they're gonna we're gonna lose our phony

40:31
baloney jobs here we don't you know we

40:34
so

40:35
the reality of it is is you have to

40:38
you're accountable to the shareholder

40:42
not the client not your customer not the

40:45
consumer whereas mutual companies

40:48
different ball game i see i i like the

40:50
mutual company and i like it better why

40:52
because the mutual company

40:55
doesn't have shareholders you have

40:57
members and when you buy a policy you

40:59
are a member right and when you become

41:01
that member they are responsible to you

41:05
right

41:06
right i i first if i had a preference of

41:09
where i was going to do my business and

41:10
put my money into something i put it

41:12
into a mutual company versus a stock do

41:14
you see more and more um because there's

41:17
a lot of capital out there looking for

41:19
homes to place it do you see a lot more

41:20
consolidation in 2022 in the industry

41:26
in the index annuity space on the

41:28
insurance company side i don't think so

41:30
yet because everybody's posting record

41:32
profits got it um but i will tell you

41:36
this those bermuda companies and that

41:37
bermuda triangle and all those offshores

41:40
a lot of those were all started by hedge

41:41
fund guys right yep

41:43
all wall street corporate raiders hedge

41:46
funds and we like to buy everything 50

41:47
cents on the dollar yep so they're

41:49
waiting for this to

41:51
trickle back a little bit and then

41:53
they'll come start swooping in and

41:54
you'll see more

41:56
things pick up in our industry on the

41:59
the insurance side yeah i think you see

42:00
a lot of consolidation and you keep well

42:02
i think uh marketing organizations will

42:04
keep buying other marketing companies

42:06
and so you're going to condense this

42:07
thing down into probably five or six

42:09
super imo's

42:11
that's uh sorry that was stan and i

42:13
lingo independent marketing organization

42:15
for people when agents contract with

42:18
indexed annuity companies or annuity

42:20
companies in general there's a typically

42:22
a two-step distribution there's a

42:24
middleman called a sales and marketing

42:26
organization independent marketing

42:27
organization however you want to call it

42:29
imo smo that

42:31
um do all the contracting etc not

42:33
everyone is this tech savvy and master

42:36
of the annuity universe like the annuity

42:38
man there's a lot of one one-man shows

42:40
out there that sell one-woman shows that

42:42
sell annuities and these marketing

42:44
organizations kind of help them

42:46
do their do their and entire practice i

42:49
i want to also ask you about

42:51
the you know we're seeing the the you

42:53
know the buffer type annuities the copay

42:55
annuities the ryolas all that stuff

42:58
anything new that you're hearing in your

43:01
meetings on the index annuity side and

43:03
what they're trying to do different

43:04
because i have this feeling we're going

43:07
to be blindsided

43:08
by a new product type going forward

43:12
i got nothing right now but i i tend to

43:15
agree with you on this i mean

43:17
look we're 13 years

43:20
and the note is horrible yep

43:23
so they're gonna have to figure out

43:25
something

43:26
and i think what you're going to really

43:28
see more than anything is all of these

43:30
companies go away from guarantees

43:33
and like strip down the guarantee as

43:36
much as they possibly can still keep an

43:38
insurance prompt

43:39
among you which is you know you get your

43:41
your principal's safe

43:43
but they're going to probably strip away

43:45
a lot of guarantees and the reason why i

43:47
say this i think if you look at indexed

43:49
annuities as a whole stand you know the

43:51
the guarantee if you look at the base

43:52
guarantee it's like what one point eight

43:54
seven five percent of

43:56
yeah yeah

43:57
let's just say one percent to be to be

43:59
savvy yeah say one percent to be

44:00
satisfied so you have a one percent

44:02
guarantee of what you put in et cetera

44:04
et cetera at some point you know they

44:06
have to reserve for that the insurance

44:07
company right give you x they have to

44:09
make sure x

44:11
plus an extra nickel or so is there i

44:13
mean they have to have that reserve

44:15
so if they say you got a dollar they got

44:17
to have a buck 05 or something in

44:19
reserve right

44:21
i truly think you'll see all that get

44:24
wiped away

44:25
and i think they will just go look your

44:27
principal's here and then that way they

44:28
don't have to reserve and then that way

44:30
they can

44:31
well let's just be caught with this they

44:33
make more profit yes they give a little

44:36
bit of it back in a higher rate a higher

44:38
this more you know

44:39
don't ever

44:41
don't ever ever ever confuse features

44:45
on an annuity with benefits

44:48
never very nicely put by the way uh just

44:51
to echo what um

44:53
mr fiax said

44:56
the largest arguably the largest issuer

44:58
of indexed annuities just announced a

45:00
month ago

45:02
that they are going to lessen the

45:04
guarantees

45:05
um and on on their index products and

45:08
all the products across the board

45:09
they're gonna they're gonna do exactly

45:10
what mr fix said and they're the leader

45:13
so that's kind of the canary in the coal

45:15
mine because now other carriers i think

45:18
will follow

45:19
suit and the the ironic part about them

45:22
announcing and we have no problem with

45:23
that company love that company we

45:25
represent that company they're big and

45:26
massive and huge

45:28
um but i really don't sell a lot of

45:30
their stuff because why their their

45:32
their guarantees aren't competitive

45:34
their contractual guarantees aren't

45:35
competitive but i did think it was

45:37
interesting that they came out publicly

45:40
and said that so i've always told people

45:42
don't buy hypotheticals theoreticals

45:44
back tested hopeful agent return

45:46
scenarios unicorns chasing the

45:48
butterflies because it never comes true

45:51
and what this number one carrier said

45:54
is

45:55
we're going to sell hypotheticals

45:56
theoreticals projections and unicorns

45:58
chasing the butterflies that's what's

46:00
going to be our primary and that's what

46:01
the ironic part

46:03
is that they've kind of been doing that

46:05
for the last five to seven years anyway

46:07
i just think they finally came out

46:09
because they're european-owned and they

46:10
have a base here in the united states

46:12
and they said we're going to do that i

46:14
understand the business i'm like you i

46:15
get it they want to make more money it's

46:17
a tough environment with interest rates

46:19
but what people have to understand is

46:22
don't you know be careful not to buy the

46:24
back tested number it sounds too good to

46:26
be true because it is well do you see

46:28
more and more of that in the industry

46:30
con

46:30
firms coming off that about that no you

46:32
just hit on something really good about

46:33
the illustrations and all the pie in the

46:35
sky and unicorns and all that good stuff

46:38
in the illustration never buy the

46:39
illustration and here's why if you like

46:41
the way that illustration looks you're

46:43
10 years too late

46:45
bingo

46:46
because every day

46:48
that you do that illustration if i run

46:50
that illustration one day later

46:52
totally different

46:54
and the next day totally different and

46:56
the next day totally different and the

46:58
next day totally different if you could

47:01
move you can move by a day or two

47:04
and go from a huge return to nothing

47:07
just like that and in some states in

47:09
some states it's illegal

47:11
correct you're starting to implement

47:13
laws to say you cannot show back test

47:15
numbers on life insurance products like

47:17
index universal life where it's really

47:18
juiced and there's some

47:20
some really bad sales practices going on

47:23
and on the index side as well well let's

47:25
just do this stan i'ma ask and for all

47:27
the people listening

47:29
does the stock market or anything you

47:32
know

47:33
moving averages

47:35
good point no

47:37
never in the history of the market it

47:40
has never returned the same return two

47:43
consecutive years yep never

47:46
ever never ever

47:48
never will and never will by the way

47:50
yeah i mean i don't think it will i

47:51
really don't no but i i i i would take

47:54
that bet if i could get that that's what

47:56
i would take but so my point being is

47:58
this is

48:00
when you

48:02
show averages it's incredibly misleading

48:05
yes it is

48:07
because it doesn't move that way the

48:08
market moves in peak and valley

48:11
and for our products what what would

48:13
really be the greatest and this won't

48:15
make sense to people is when you

48:17
actually buy the your product you'd love

48:19
for it to just crash you want to go all

48:21
the way to the floor why because when

48:23
you reset and you touch the spike it

48:25
goes all the way up right and so in

48:27
perfect theory you'd want to crash for

48:29
two years or three years and then go up

48:31
for two or three years and then crash

48:32
for two or three years and go up for two

48:34
or three years because you that's how

48:35
you would maximize your return right

48:38
but oh my gosh if it crashed people

48:40
would freak out but in reality

48:42
we have a horrible horrible horrible

48:45
investment philosophy if people love to

48:47
buy high and sell low

48:50
they love it it's amazing yeah the

48:52
institutions love it because people

48:53
they're just providing liquidity to the

48:55
big money so that

48:57
that is what it is

48:58
mr fiax i you know i try to imagine

49:01
being you sometimes and being that smart

49:04
about indexed annuities and that's a lot

49:06
of responsibilities dan thanks i'm just

49:08
i i can't i could but i want the

49:11
listeners to understand

49:13
how valuable it is to have mr fiax on

49:17
and for him to take the risk

49:19
of coming on and telling the truth about

49:22
these products once again

49:24
we're fans of indexed annuities we're

49:26
just not fans of how they're sold and

49:29
how they're pitched i don't like how

49:30
they're portrayed i think they're i

49:32
think when anyone says you're going to

49:33
get market like returns that's bs if

49:35
anyone says you know oh they're safe

49:37
secure you got market like returns no

49:39
you you don't get market is it safe yes

49:42
if you follow the contractual rules it's

49:44
safe if you play by the framework it's

49:46
safe are they for everybody no but i

49:48
think my biggest problem i have with

49:50
these is these guys and stan we've

49:51
talked about this for almost 20 years

49:53
together is

49:56
they are so

49:57
one-size-fits-all it's such a panacea

50:00
that they can cure everything with right

50:02
annuity and then after it was an indexed

50:05
annuity couldn't cure it what the index

50:06
annuity with an income writer should

50:08
cure it and then and and now a buffer

50:10
annuity now the buffer annuity will

50:12
those were horrible this will really

50:14
cure it right and it just you know right

50:17
what you really need to do is and

50:20
is one thing this is your money folks

50:23
it's your money you tell stan what you

50:25
want it to do

50:27
and here's what stan will do

50:29
stan is going to explain the rules of

50:31
the game and just keep you in the lines

50:32
and tell you if it's not if it's not

50:34
possible and and you know that insight

50:36
from mr fax comes from a person that

50:40
we're going to have to do this just to

50:41
just to see what the number is but i'm

50:43
going to guess

50:44
he's been

50:45
behind and recommended and overs

50:48
overseen

50:50
multiple

50:51
billions with a b

50:53
sales of indexed annuities so when we're

50:55
talking about indexed annuities

50:57
he is weighing in from a person that has

51:00
suitably and appropriately placed

51:02
multiple billions of dollars with his

51:05
his group i'm just going to say that

51:07
with indexed annuities so

51:09
i just want you to understand he's a fan

51:11
but he's just not a fan of how it's sold

51:14
we don't blame the carriers because

51:17
um

51:18
to a point you know sometimes we do but

51:20
the majority of the time they're just

51:21
putting it out there and then the army

51:22
of agents say what they want to say and

51:24
it's hard to

51:26
regulate that you can't police what

51:27
comes out of their mouth and you're

51:28
right are static they are what they are

51:30
but you said a very important word then

51:33
billions

51:34
billions i like that word too but the

51:37
word was sold and i think where stan and

51:39
i have a real hard time with this is

51:42
annuity should be bought not sold

51:45
and and that's what we said that's

51:47
you know we we've we've actually

51:48
trademarked that uh for our site which

51:51
is where annuities are bought not sold

51:52
because you know you're buying

51:53
contractual guarantees there's never an

51:55
urgency to buy that there's an urgency

51:57
to you for you to understand what you're

51:58
buying yeah there's no one in the

52:00
emergency folks there's no annuity yeah

52:02
and you're going to see that i think i

52:03
think you're gonna see a lot coming at

52:05
the end of the year first of the year of

52:06
fire sales and bonuses and all this

52:09
stuff there's gonna be a nudity

52:10
emergencies everywhere the next six

52:11
eight weeks

52:12
annuity emergencies

52:14
uh we gotta we gotta tie this up and i

52:16
always love asking you this last

52:17
question

52:18
just to tie things up and to provide one

52:21
last insight into this

52:23
indexed annuity world

52:25
what would you tell consumers and

52:26
listeners and viewers right now

52:29
well i think there's a couple of things

52:31
i think one is i do like if it sounds

52:32
too good to be true it typically is

52:35
i think you need to understand that your

52:36
money and what do you want it to do for

52:38
you

52:39
i think the other thing is when these

52:40
guys show you this big huge income

52:42
number do you really need that much

52:44
income

52:45
because here's a big problem

52:48
is when you put that money in there and

52:50
they put that income writer on there you

52:52
better be happy

52:55
and why i say that is because of

52:57
compliance rules and the way things work

52:58
right stan

53:00
kick that money up and roll it to

53:01
another carrier and i know what you guys

53:03
are thinking it's my money i can do what

53:04
i want they have the right to refuse no

53:06
shirt no shoes no service they have the

53:08
right to refuse that money so we need to

53:11
be careful

53:12
in the other part too that i watch

53:13
agents do a lot of standards they put

53:15
this money in to create this huge income

53:16
number like here's 50 000 a year of

53:19
income and you're like oh my god that's

53:21
great but i only need 20.

53:23
well they just gave you a 30 000 a year

53:25
tax burden right

53:27
which by the way is good oh

53:29
so

53:30
there's it's just not that simple as hey

53:32
here's the number right yeah let's look

53:35
at your situation and tailor make it to

53:37
your situation and i think a lot of

53:38
people just you square back round hole a

53:42
they do and i appreciate you kind of

53:44
leading me into one thing one of the

53:46
things we're proud about with our income

53:47
rider calculator is that you can run a

53:50
reverse engineered quote meaning that

53:52
hey i only need 20 000 of income put in

53:55
20 000 in the quote and then we're going

53:57
to quote all carriers to show the

53:58
carriers that would pro that would back

54:00
up that guarantee using the least amount

54:02
of money i think both of us would agree

54:04
that one of the biggest mistakes we see

54:06
in the annuity gods hate us for this but

54:09
it's people putting too much money into

54:11
fixed index annuities annuities in

54:13
general and that's the reason that we

54:14
provide the reverse engineer quote so

54:16
that you can hit it right on the money

54:18
what you need and not create a an

54:20
additional tax burden

54:22
i like that i also like real quick is

54:24
the ladder contracts yes you have two

54:26
three four contracts and one has this

54:29
time frame one's on that time frame

54:31
one's got a different type or a

54:32
different purpose maybe only one has an

54:34
income rider and the other one's built

54:35
for strictly accumulation so when you

54:37
spend all that money out you've replaced

54:39
it all

54:40
another thing too and you taught me this

54:42
you're the first person that told me

54:43
this a long time ago and i think i'm the

54:46
only one actually actually implementing

54:48
this is from the accumulation value

54:51
strategy with index annuities we're

54:54
actually laddering index option

54:56
durations meaning that if if splitting

54:58
the money between three carriers one has

55:00
a one year option one has a two year

55:02
option one has a three year option

55:04
and i don't know of anybody other than

55:06
me that's doing that and that came

55:08
directly from mr fiax because he is the

55:10
expert here in this space which is why

55:12
he's on

55:13
on the podcast i think that's another

55:16
way from an accumulation standpoint is

55:18
to

55:19
you know to leverage those index options

55:22
because what did we say earlier the

55:23
longer the option the higher the

55:25
potential return so if you have a one

55:27
year and a two year and a three year

55:28
option and maybe a four year option and

55:30
you split four hundred thousand dollars

55:32
equally in a hundred thousand increments

55:34
for a fixed bucket

55:36
not a bad strategy in our and our uh i

55:39
was getting ready to say our fans and

55:40
that is the truth but our our clients do

55:43
like that and they have not heard that

55:45
so once again what i want people to

55:47
understand is yeah hey you're talking to

55:49
a guy me i'm i you know i'm

55:52
i sell more index annuities than most

55:54
agents on the planet i just again

55:56
horrifically bothered by how they're

55:57
sold

55:58
and mr fix is behind billions of sales

56:01
we just want you to be careful out there

56:03
and once you put your thinking caps on

56:04
but uh hey i really appreciate you

56:07
joining us me mr fiax you obviously will

56:09
be on again in 2022 as things change but

56:12
i want to thank all of our listeners and

56:14
viewers for joining us once again on the

56:17
number one annuity podcast on the planet

56:19
which just happens to be called

56:21
fun with annuities see you next week

56:24
i want to make sure that everyone wrote

56:25
down our predictions because i want to

56:27
show how that true they become you watch

56:29
all right with that see you next week

56:32
take care everyone take care

56:38
thanks for listening to fun with

56:40
annuities please hit the subscribe

56:42
button and make sure to go to my site at

56:44
the annuityman.com where you can run

56:47
your own spea dia and culat quotes and

56:50
see a live feed of the best mica fix

56:52
rates in the country and even get

56:55
indexed and income rider quotes as well

56:57
you can also sign up for my six annuity

57:00
owner's manual books and i'll ship them

57:02
for free and under no obligation i also

57:05
encourage you to schedule a one-on-one

57:07
call with me stan the annuity man so we

57:10
can have a full discussion of your

57:12
specific situation it will be the best

57:15
brutally factual and truthful advice

57:18
you will ever get and that's one

57:20
guarantee you should definitely take

57:21
advantage of so join me next time for

57:24
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57:26
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57:28
with annuities

57:32
[Music]

57:43
you