Replay: Live Q&A What is the Best Annuity for You? January 2022

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[Music] so [Music] do [Music] [Music] hi there stan the annuity man here welcome everybody to the annuity man live so glad you joined us get those questions ready because i'm going to answer them brutally and factually as you know if you don't know who i am this

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is your first time meeting me i'm standing nudi man licensed in all 50 states arguably america's annuity agent so let's just jump right in i'm very proud to announce that after a lot of money and work and time and effort and stripping it down and making it simple

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we have the best income writer calculator on the planet now if you go to my site at the annuityman.com um you can run quotes 24 7 365. we have usb and immediate annuity calculator deferred income annuity calculator qualified longevity annuity calculator

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we also have a live miga feed my guests are the annuity industry of a cd cd type annuity and but income riders are what is for what i call income later um so if you i always ask people two questions what do you want the money to contractually do and when do you want those contractual

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guarantees to start if the first answer is i need lifetime income and the second answer is i need it to start three years seven years ten years nine years whatever that is down the future down the road then we're going to quote both deferred income annuities

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and income riders but here's the fun part now you can run it yourself 24 7 365. we work with all the carriers um that offer these income riders attached to fixed annuities and then you can you know pull it up and and run that quote so um i have some really smart people behind the scene

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um so let's go to the site and pull up the site and that's that's actually the website uh and at the top left you see top you see book a call use the calculators get the books obviously i'll send you my books for free if you're not familiar with that i've written six owner's

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manuals on all annuity types and we'll send you those for free and under no obligation via ups you just have to put in your shipping address we don't sell anything or or share any of that information we just send you the books so let's go to the calculators so this is how it works and

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yes we are going to get your questions just hang in there i'm just proud of this come on i spent a lot of money on this this is good and those are all the calculator choices so let's choose income writer so income writer is in just a background on what that is it's an attachment to a

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policy at the time of application that has that that offers a lifetime income guarantee starting the income at a future date if you draw a line down a blank sheet of paper visually left hand side of the ledger is the accumulation value real money walk away

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amount right hand side is the income rider amount two separate calculations but the income rider if you're looking for lifetime income then we're focusing solely on the contractual guarantees because as you know you own an annuity for what it will do not what it might do okay so we're

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putting in all this mr schmoe joe in colorado so you know we're doing a non-qualified you can put an eye you can put an income rider in an ira not in an ira you can choose that you can choose joint life or single life and we're going to start income in eight

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years we're going to do a lump sum on this one let's do let's let's see what a hundred thousand dollars was is gonna is gonna create eight years from now contractually get a quote here it comes and when you see that going up and down like that we are

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attaining all the quotes from the carriers the little men inside the computer are sorting it and then we're going to list it and um if you put in your email address the right email address will send you the quote as well if you put in a fictitious

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email address you're not going to get it you'll just see it here but you know we don't sell any of that information we're not going to bombard you we treat you like a pro so put in your email address so we can send it to you so let's scroll down okay so if you look at just all

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right here's an income writer it's single life it's for joe schmo he's male he's born in 64. he lives in colorado or colorado if you're from there a hundred thousand dollars non-ira once again you can run it inside of an ira deferring for eight years what is the best what

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are the best that's it here we go these are contractual guarantees period this this isn't some hypothetical theoretical back-tested unicorns chasing the butterfly nonsense these these are the numbers that's going to happen okay so let's scroll back down one more time

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and let's look at all of those so we're quoting pretty much every carrier that offers this and so you see that they're they're they're quoting they're they're bidding on your business and remember lifetime income guarantees with annuities are primarily based on

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your life expectancy if it's single life expectancies seize a plural if this joint at the time you take the payment just like social security the older you are the higher the payment all right so let's go backwards let's do a reverse engineer quote because one of my things

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out here that i tell people is let's run let's run ira on this one um let's just do an ira one of the things i tell people all the time is and and the annuity got to hate me for this is use as little amount of money as humanly possible to solve for the

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contractual guaranteed goal so if you income flooring to me is social security your pension whatever is going to hit your bank account every single month right not your head so let's just say you need eight years from now you need um three thousand dollars additional per

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month it's just thirty six thousand dollars a year and you need that to hit in eight years we can run that and we can show you how much money it's going to take to create that contractual guarantee that contractual guarantee you're looking for now one thing is this thing is crunching

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and pulling up the quote inflation is a big thing hold right there for a second before we scroll down people say what about inflation then what about inflation what about inflation good question um better voice i hope you're asking than that but

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anytime an annuity company has a product that adjusts for inflation they're going to significantly lower the initial payment to make up for it anywhere from 20 to 40 percent okay so there's no free lunch the best inflation annuity on the planet social security of people that

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are going to get that increase this year you're going to find that out for sure but any time you're talking about an increased and i know there's sales pitches out there if it sounds too good to be true it is every single time that say it's going to increase if it does there

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the annuity comes just lowering the payment drastically so let's let's scroll down and let's see what it's going to take to create that three thousand dollars a month so this is if you said i want three thousand dollars a month to start in eight years

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you see what the amount of premium it would take to to guarantee that lifetime income stream as long as you are breathing right so it is nor our roi until you die and please don't make the the correlation well i could do better with investments stand the annuity man i hope so okay

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annuities are contracts investments are investments annuities are not investments these are transfer of risk contracts and and what you're doing is you're transferring the risk to solve for longevity what does that mean it means the fear of outliving your money

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so this is going to pay as long as you are breathing so i'm very proud of really the best income writer quote uh calculator out there period end of story we've done our research i'm sure someone's going to try to copy us good luck but you know i really am proud of

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this because it's so so simple um before we get in the quest to get to the questions i had a um a phone appointment this morning before we got going on this live event and by the way you can go to my site if you remember there was the book of call thing at the top left hand corner you

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can get me for 30 minutes okay you can book a call with me and this gentleman was from massachusetts and he had a his last name won't give out his last name but his last name is is uh is the name of a fruit so he said he said stan can you can you you know do a shout out to me as the

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tropical fruit from massachusetts so yes tropical fruit from massachusetts dude who i really liked is a fun guy um welcome he's on this he's on this uh live event so let's jump into the questions because man they're lining up so let me read them out to you what are

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the pros and cons of using a michael ladder in lieu of a bond ladder thank you cynthia for asking this for the fixed income portion one's overall asset allocation now let's talk about bonds for a second and you're you know one of the things that i yeah i'm proud of is i manage bonds for

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morgan stanley and ubs and dean witter and peyton webber i did i've done that so i understand bonds i understand that world um bonds you know obviously have a a coupon a guaranteed interest rate so do migas multi-year guarantee annuities the difference between the two is the

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multi-year guarantee annuity will not the principle will not fluctuate the valuation of it will not fluctuate is a fixed annuity where bonds if you've ever purchased bonds they do fluctuate if you hold them to term if you hold them to duration you know that they're going to

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be exactly what you put in them but if you try to sell them earlier or then the duration end there's going to be some fluctuation and people need to understand yes stocks and etfs are volatile but so are bonds bonds are can be very volatile if you don't believe that

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if interest rates move this year you're going to see the valuation of bonds go down the ones that let's let's say you bought them now and interest rates go up you know that valuation is going to go down it's like it's like a la a seesaw remember the seesaws back in the day so

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um i would say the pros of the the multi-year guarantee annuity is number one you can do short durations two year three year four year five year it's very hard to find very good bond quality out there right now in the shorter durations the only way to really do that is with a

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mutual fund or with some type of packaged product that has shorter duration bonds does not make migas better than bonds i think you could have both in your portfolio for the fixed income but for my guest no moving parts no annual fees no market attachments it it functions

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similar to a cd the only difference between migas and the cd is that in a non-ira account the interest grows tax deferred when you pull money out obviously it's taxable but i think mygas are a very good short term duration way to latter fixed rates definitely next question

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when the this from eric when the exclusion ratio goes to zero 100 of the annuity becomes taxable what's a good strategy for paying these taxes while maintaining constant income floor my question mark good question let's go backwards a little bit exclusion ratio

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when you when you buy an immediate annuity um the income is a combination of return of principal plus interest okay so in a let's just say in a non-ira account you're getting your principal back with interest the exclusion ratio means that you're not paying taxes on

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that principal amount you're getting back you're paying taxes on the interest and what they do if you're buying a lifetime income stream immediate annuity is they they spread out that tax liability over your life expectancy but what eric's pointing out here is what if

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you outlive your life expectancy draw the account down to zero then if you do that then 100 of the income stream at that point in time when the accounts at zero will be taxable um is there a good strategy uh to combat you living forever and having to pay

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taxes when the account's at zero i don't think so i guess you could offs you could offset that with some miga uh growth you know guaranteed interest rate cd type growth um and right now at the time of this tape into three years like at two and a half in most states and five years at

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three or three point one five in those states again you can go to my site and pull the live microfeed but eric i don't think there's a great strategy for this i just think that i appreciate you pointing out that if the account goes to zero then 100 of that income stream is

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going to be taxable remember annuities are the only product that will pay you for the rest of your life as long as you're breathing i have a saying good southern saying that there's no roi until you die because up until that point it's a transfer risk that the

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annuity company's going to pay as long as you're breathing and also remember that we can structure it so that the evil annuity company will not keep a penny if you die early or whenever you die all of that money will go back to the beneficiaries that's in the account

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whatever's left in the account even though they're on the hook to pay so don't think that well i'm not going to ever buy an annuity because when i die the money goes poof that's one of 40 ways to structure it and most people choose to structure it's like life with

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cash refund or life with installment refund to make sure that that hard-earned money goes to somebody in your family even though the annuity companies on the hook to pay for the rest of your life let's go to the next question um do you have to move money from a 401k

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to i'm gonna say i i think you want to put ira before buying an annuity um you do not but it does make it easier for the transaction the 401k to ira um is a non-taxable vent transfer from the 401k to the ira and then from the ira to the ira established that the annuity

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company is also a non-taxable event transfer but it it does make it easier from the administrative standpoint uh can we transfer it directly from the 401k yes but all 401ks are different and the administrative people that are running that 401k they're also different there's

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different rules with different defined contribution plans which are 401ks but in a perfect world that 401k would transfer to the ira first and then the ira would transfer to the annuity next question you can only invest 50 percent of your 401k intentions let's talk about that

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and i and i address this a lot about the annuity industry somewhat frowns upon um you putting more than 50 of your investable assets into an annuities annuities of any type that's not a hard and fast rule that's just an industry suggestion they don't want people putting all their

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eggs in one basket i pound the table on that as well can you put a little bit more than 50 if you tell me the reason why and then i can go to the carrier and tell them why yes but you know once it gets to say that 60 level if we can get to that if we get to that i start

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getting queasy and wondering why that you're putting all this money into annuity so if someone is um someone should never say yeah let's take all of your money and put into annuities it's just not suitable or appropriate and most caries will decline that um

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that that transaction if you if the ratio is just not uh suitable and appropriate to you so i would i would say the 50 50 to 60 is probably maximum that doesn't mean you have to put that in and i'm just saying you know when we get there and i say how much investable assets do you

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have you say well i've got 500 000 um i'm like well let's kind of start talking 250 if that's what you want to solve for and then you can convince me otherwise if we need to increase that so um next next question teresa thanks for putting this in i'm

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retired need income my 3 cds are gone as of next month and i need to keep this money safe what do i do there's two there's two things you can do as i mentioned uh in previously there's multi-year guarantee annuities which are the annuity industry version of a cd currently the five-year

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guarantees are three percent per year in most states not all you have to go to my site and run and look at those uh you just when you go to my site and go to the live mica feed you put in your your state and why don't we do that can we do that producer can we pull up and show

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the microphone so if you go there see live rates if you go just see the live race if you click that okay and then it's going to pull up um a drop down two drop downs it's going to show your state let's just stay there you're in alabama and you're going to look for a

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three-year or or five year or whatever it's three here's the three and it'll just pop up and so let's just say you say okay that's three years two and a half if you see the yield of surrender go back to change state and you go back to if you go back to this button right

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here okay and then you can drop down and say okay what's the five year so put in the five year and then you'll see what the five years are and right now the five years at 3.15 of threes etc you can see that so that's a good way to that's one way for you to protect your

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your amount so getting back to that question if you can put that question back up i'd appreciate it the if you want to replicate the three percent cds that you have my guess are the way to do it okay because you protect the principal you don't touch it you're

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getting three percent that would be the way that i would tell you to first go teresa and then if that doesn't you know that doesn't work then we can put some together for you customized next question chanel thank you so much i'm assuming that's how you say your names um you're

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55 is it better to buy a deferred income annuity now for you starting at 65 or wait until 65 and buy an immediate newly just a fantastic question okay um one thing too that you could look at is if you want income to start at 65 you can always and i would quote income

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writers as well using that income writer quote because deferred income annuities and income riders are the two ways that you solve for what i call income later income starting at a future date and this example is starting at age 65 10 years from now so you can run a deferred

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income annuity quote 10 years from now or a um an income rider quote deferred 10 years from now but the question is would it be better to wait the answer is maybe and i know that's not a great answer but it's true you can always what i what i call defer

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to spea meaning that you could buy migas and then 10 years from now you know convert it to an immediate annuity would go shop all immediate annuity carriers for the highest contractual guarantee at that time or you could buy say an indexed annuity just for accumulation no rider and then

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at the time of uh that you need income we can transfer it to the highest paying single premium immediate annuity there's no good answer to this what i would tell you to do if this is something you're thinking about is maybe split the baby as they say in uh in in the south is you

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if let's say you had two hundred thousand dollars we do a hundred thousand dollars in either an income rider or deferred income annuity with income starting in 10 years whichever one of those products finished the highest both of the contractual guarantees and then you might do an

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accumulation product like a miga or an indexed annuity with no attachments and then at the time you needed income shop for an immediate annuity at that time that would be my recommendation great question though next question i'm retired 72 year old single female

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what is the best annuity for my situation good question but i have two questions that i ask everybody to determine a if you need an annuity and b what type would fit you meaning that what type would provide the highest contractual guarantee and that those two

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questions are what do you want the money to contractually do and when do you want those contractual guarantees to start from those two answers then i can determine a if you need an annuity and i'll tell you if you don't and b if you do need one which one's

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going to provide the highest contractual guarantee so there's no there diane there's not one that just is at best annuity for any anyone says to you this is the best annuity for you diane they're just trying to sell you something we need to pinpoint the type

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of annuity that would provide the highest contractual guarantee based on those two answers okay so please schedule call with me we can go with that uh go with those two questions and then i can put something together for you next question um the effect of fed raising interest rates

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what effect we'll have on the migrates obviously good question and the fed has promised rate hikes before and not delivered let's hope they deliver this year we're crossing our fingers for you the consumer um if they raise interest rates then then multi-year guarantee annuities uh

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fixed-rate annuities will you know they'll the yields and the coupons will rise we don't see them acting immediately in other words if the fed raises um you know my mygo companies aren't going to just immediately run and raise their rates think of my good companies

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like going to the junior high school dance remember those and no one would dance with anyone because someone's everyone is self-conscious and then there were two people that did finally dance and then everybody dance so it's kind of one of those things where

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if it's a competitive world it's a commodity product annuities are commodity products you got to shop all carriers once somebody body raises the interest rate you'll see some others follow but we just don't know when that's going to be coffee time next question

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is it good to use ira money for an annuity the answer is um it doesn't really matter either whether it's ira non-ira or roth ira because the contractual guarantees are the same regardless of the account type you'll hear people that are uninformed that you think are smart that say never

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put an annoying thought of an rra that's insane and and stupid uh on its face because there's actually an annuity that can only be used in a traditional ira that's a qualified longevity annuity contract so with most people out there that have most of their investable assets in um

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you know in their ira their traditional ira if you need contractual guarantees whether they be principal protection or lifetime income then yes we can use ira assets for that um obviously money coming out of an ira whether it's annuity money or non annuity money is

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going to be taxed at ordinary income levels but the reason that you would put money and use money with an ira is for the contractual guarantees so if you need contractually guaranteed lifetime income it's okay to use life uh your ira for that period next question

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john and christy uh if i retire the age of 57 can i fund an annuity for my 401k with my former and former company to start in five years without paying a penalty for early distribution the answer is yes you can you can take those 401k assets you can you can roll them into an ira

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and then that ira can be rolled into an annuity that provides the highest contractual guarantee for what you're trying to solve for so both of those transfers are non taxable events they do not trigger any taxes even though you're pre 59 and a half and

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my team if you decide to become a client we take care of all of that from start to finish turn key for you next question heart man heartman 85 what factors that's his name for everybody what factors are in play when deciding between an income rider as and simply

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annuitizing good question heart man um income the reason you buy an income rider or deferred income annuity to start at a future date would be to to lock in the guarantees now and know to the penny what that lifetime income stream would be in the future the other

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reason you do it now is because um you're locking in the life expectancy tables at the current levels and i think those are going to change against you in the future and that's not a sales pitch that's just i think they're going to after the covet thing kind of kind of

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flushes itself out for lack of a better phrase i think the life expectancy tables will go up meaning they're going to project you to live longer the other part of the question which is simply annuitizing um if your income writers mean you're you're trying to turn on income at a

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later date annuitizing means i'm going to buy an immediate annuity at that time at a later date there's no good answers i answered a previous um question my advice would you would be to split the baby and do half in the income rider now and then and then annuitize um at a

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later date because we don't know where rates are going to go we certainly don't know where mortality credits and and life expectancy tables are going to go we can kind of predict that but i think if you do do split between the two you're going to win contractually next question

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harry in oklahoma go sooners or go cowboys whoever you're pulling for what are your thoughts on getting a cert period certain annuity that is used to bridge uh until you're seven years old very good question harry and nice grandchild on your lap there in the

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picture um what he's talking about i'll give you hypothetical let's just say harry is 63 years old and he needs an income gap between 63 and age 70 okay and he just that's all he needs it for he doesn't need it for life he needs a period certain annuity that's going to

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pay for that seven years we can quote that okay but when we quote that then it's 100 dependent on interest rates okay it's not dependent on life expectancy because if you do a lifetime income stream immediate annuities primarily priced and based on your life

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expectancy interest rates play a secondary role but with a period certain this it's going to pay stan i want it for seven years i want a monthly income for seven consecutive years and after that it's over that's going to be interest rate based and you're going to

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see that interest rate be at that one percent to two percent level so return of principal plus interest remember that with immediate annuities so we can do that if you want me to quote that i certainly will do not expect whiz-bang returns just the reason that you would

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do that if you said stan i want to fill that gap from 63 to 70. the reason that you would do that is because it's turnkey i mean it was locked and loaded and you know that's going to happen for those seven years and that might be your goal and that might be what you're

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trying to achieve next question teresa i was told by someone you know uh paul m i'm assuming that's mr merriman that you are the most honest annuity seller that he knows will let's let's stop right there okay uh thank you paul for that we do the best we can i'm not perfect um

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you know we are brutally factual as my grandfather told me in north carolina a long time ago if you tell the truth you don't have to remember anything so that's kind of our business model um so i appreciate that and we are going to do the best we can and i am going to tell

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you the truth i mean i am just straight up will annuity rates always be higher than cd rates the answer is no um you know for the shorter term cds like the the six month the 12 month the 18 month cds there are no such things in the in the migra world and there there

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will come a time where cd rates are typically are going to be a little bit higher than than migos but i don't see that happening for a long long time so the question another question that could be asked is why are migra rates higher than cds standing nudity man america's

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nudi agent and the reason is um cds are primarily priced on current interest rates where migra rates are primarily priced it's kind of four legs to the stool life insurance companies issue migas okay so there they have life insurance that they sold they've got

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lifetime income products that they sold they got a bond portfolio and then they look at interest rates the combination of those four legs of the pricing stool allows them to guarantee contractually a higher yield than cds doesn't make them better than cds okay but that's the

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reason you see them higher okay next next question do rmds have to be figured separately from iras and 401ks iras and 401 and this is tax question please consult your cpa for true tax answers iras and 401ks are what's called qualified accounts and qualified

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accounts are deferred meaning you haven't paid taxes on those gains as they've been accumulating um you don't have to figure them separately the irs if you think the irs and i know it's tough to think about the irs on a saturday like this but let's let's

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think of let's here's how they think they're saying i want to see all of your qualified accounts and we need the rmd from the total of all of those okay so you don't have to take them separately you don't have to take them in proportion all the irs knows is if you

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have five hundred thousand dollars scattered amongst iras and 401ks and 457s and 403 b's all they care about is getting their percentage they don't care where you take it from next question can i buy annuities with crypto heck no not at this point nice question um you

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know crypto and the blockchain technology is here to stay we all know that i do think that there's gonna be kind of a flushing out of them you know there's five six thousand of them at this point i think the government will get involved at some point in time i

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don't want to go down that rabbit hole but at this point in time you cannot buy an annuity commercial annuity of any type using crypto will that change in the future who knows next question i like single life this is uh i like single life immediate annuities enjoy

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playing games of chance with own life and actual prog prowess single life immediate annuities are transfer of risk pension products what i would and i think what mr mrs moon is saying here um the way to use annuities for lifetime income is create that lifetime income

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floor that amount of money that you need to hit the bank account so you can live the life that that you want to live and that you've earned and that's going to pay the bills and pay the lifestyle bills etc and then from there go invest the rest go live your life because you

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know you have that income full floor in place annuities of the only product that provide a lifetime income stream as long as you are breathing and there's no perfect time to buy one there's no product that's better than the other we're just going to quote all carries

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for the highest contractual guarantee for your specific situation that is approved products approved in your specific state next question thank you stan best explanation that's that's not an employee i appreciate that um but i try to make it simple you know

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one of the things that that i pride myself on in in addition to just liking what i do and trying to make this educational and entertaining edutaining is to strip it down and when you talk to me on the phone we're going to strip it down either fur even further on your

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situation so that you understand it one of the sayings i have all the time is that if you cannot explain it to a nine-year-old don't buy it no offense to nine-year-olds and it really needs to be that simple so if you cannot explain it to your spouse significant other

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children grandchildren the annuity strategy then don't then don't buy it and in our process is a you know we really look at our site as this is uh the annuity man is where annuities are bought not sold yes i do sell annuities yes i'm the number one agent

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country and i'm proud of that because we do it the right way but you're gonna make your decision on your terms and your time frame and i always say i'm gonna end this question with this there's never an urgency to buy an annuity is i mean is there an urgency to

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buy a contract no the urgency is for you to fully understand it next question love the transparency thank you very much trying to be all right next next next comment we keep going because i got a couple other things i want to i want to cover and if that's it let me cover a couple

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more things number one um we talked about the deferred spea situation okay which is you don't have to buy an income rider right now you don't have to buy a deferred income annuity right now you can always wait and buy an immediate annuity at the time you need income and

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keep the powder dry um that's also a way i was talking to a gentleman the other day he wanted an indexed annuity accumulation which we did and he wanted to have income in the future but he didn't want to ever pay any fees and the way to do that is defer to speed because

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an income writer is going to have an annual fee taken out of the accumulation value for the life of the policy he didn't want that but he wanted the lifetime income and what what we're going to do at the end of the duration of his indexed annuity accumulation

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time period then we're going to shop for the highest contractual guarantee paying spee is at that point in time and that will uh provide the lifetime income stream and there's no fees or hidden gotcha fees on immediate annuities so the other thing i wanted to

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talk about was interest rates and interest rates um you know we're getting a lot of people saying should i wait should i buy you know what what should i do you can't time this thing and like i said annuity companies are not going to immediately react to an interest rate

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move they will eventually i think and we'll see what they do uh raising interest rates just just remember this is a political football and um if they raise interest rates mark the stock market historically gets hit a little bit so there's the stock market

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people not wanting that to happen the other thing too we've printed 25 more dollars than we had two years ago um inflation's at an all-time high which is the reason they should raise interest rates that doesn't mean they will politically if interest rates remain low or go lower then the

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politicians are going to pound the table to print more money and give it away so i think there's going to be um there's going to be some some push on that the other thing too think about interest rates is like this if you have a mortgage remember that

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when you did would you just arbitrarily raise that interest rate probably not but that's what we're asking the uh or we're expecting the government to do is raise interest rates on themselves i'm kind of a skeptic but i'm crossing my fingers after this long time period of

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interest rates going down for them to go up i am pulling for all of us that interest rates do go up last thing i want to cover if there's a couple more questions we'll get those in a second is um i've come up with a pretty unique strategy for index annuities and

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typically i'm not a huge indexed annuity person from an accumulation standpoint historically they're going to return anywhere from that two to four two to five percent range um you're not going to get market returns you might one year but the blended return is going to be in

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that four percent range if everything works out but i i do something a little bit different if you want to dig into it have me send you the information i will and it's and it's laddering index options um not the not the surrender charges i'm talking about the internal options so

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one of the things people don't even know out there there are such thing as three-year index options and two-year index options and of course the one-year index option but one of the things i like to do is with people say hey stan i just want accumulation i understand that the worst

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i can do is zero with an index annuity i also understand they're not market products i'm going to get a two to four two to five percent return what's the best you have out there there's a couple of companies that we ladder the index options internally

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which is very unique so if you want to see that i'll be more than happy to send you either an email a version of that or hard copy of of what we're doing if you want to see that um producer are there any other questions uh you can alright here we go if you buy an annuity with an income

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rider and something happens and something hap after 10 years for example you want to pull out your money and you pay surrender charges what about the fees let me kind of try to decipher that come do they make you whole certainly losing principle let's get let's go

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backwards go put the first original let's just say you're buying it you're buying an income rider typically that income rider is attached to an index annuity once you once you say i want lifetime income starting in the future then then the quote becomes a commodity quote we quote

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all income riders and our focus is not on the indexed annuity if you say accumulation then we'll focus on the index annuity for accumulation but if you're saying income rider then we're going to quote all the income writers for the highest contractual guarantee

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but let's just say you know you want your money back after the 10-year time period assuming that it's a 10-year surrender charge they're going to send you they the annuity company you're going to send you all of the money that's been accumulating in that in that

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index option side the accumulation value in full and without penalty okay yes you've been paying fees for the income rider they will not rebate the fees 99 of these companies will not do that we don't even look at that from the standpoint of when we are quoting

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income riders um they're not going to rebate the fees it is what it is but the one thing that you can go into this knowing is when you buy an income rider attached to an index annuity fixed index annuity number one you're not going to lose any money with any micro volatility

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why because it's a fixed annuity number two you're not going to get any market returns on that index side you're gonna get that cd type two to five percent two to four percent return but the reason that you're buying is for the income rider guarantee that's the reason when

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we put the income rider calculator on the site we don't even talk about the indexed annuity because you're making your decision on the contractual guarantee income writer at that point in time so i hope that answered that question next question if we have them

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can you speak to the fees with different products absolutely let's go to that number one let's talk about commissions um you know yes i do get paid my wife does demand that she lives a very good lifestyle but commissions with annuities are built into the product meaning that if you put

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a hundred thousand dollars in yes i'm getting paid but you're going to see a hundred thousand dollars in your account it's a net transaction to you as my very smart ceo leah says uh commissions are like you know the white the water bill and the light bill and the power bill

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that annuity companies have to pay it's just part of the administrative cost but let's go through the products and by the way because i represent pretty much every care on the planet there's not a uniform commission for all so i'm going to give a range okay so let's go through

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immediate annuities that range could be anywhere from one percent to three percent of the total one time once again built into the product so one to three percent speeds d is same thing one to say three maybe four with some but mostly it's one one percent to three

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percent on the deferred income annuity same with qualified longevity annuity contracts some go to four percent of the total um multi-year guarantee annuities depending on the duration the shorter the duration the lower the commission commissions can be as low as half of one

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percent up to two percent on say a five-year multi-year guarantee annuity indexed annuities and variable annuities are high commission products that's the reason sometimes you know you'll tell somebody something then you can have a sprained ankle on the sore throat and

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they're saying well you need to get an index to do it again it depends on the duration of the surrender charge so if a five-year surrender charge um indexed annuity is going to be less commission than a 10-year tenure might pay six percent or seven percent commission one time um a

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five-year might pay three percent commission one time so it really depends on the duration uh variable annuities i mean they can range all over the board from five to seven percent whatever but that's the built-in commissions um on annuities ask for fees let's talk

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about fees um there are no no annual fees for speas diaz culax and micas there's no annual fee so when people say all annuities are expensive they they have no clue what they're talking about okay they need to be talking about ballet like if if someone

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asked me about ballet that would be like some of these people answered about annuities so speas diaz-culex and migus no annual fees index annuities no annual fees unless you add the income writer and then the income writer adds the fee and with indexed annuities you can you can the

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the the income writer fee is typically one percent taken out of the accumulation value for the life of the policy variable annuities there are such things as no load variable annuities that's fine um and there are a few of them out there but the the load variable annuities the

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average annual fee all in is around three percent yes you can get them you know some are at two somewhere at four but the average is around three percent those are the fees but just to understand qlax bsd as mygas and index annuities have no annual fees period next

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question what advice would you give for someone purchasing their children under 18 don't um do not buy your children under 18 annuities put their money into and i'm not gonna give you a mark what to put it in the market but they they can absorb market growth they need market growth

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there's not an annuity type on the planet that provides market growth when you're when you're really if you're less than 50 years old you have to ask yourself why why are you even thinking about an annuity but definitely for children please please please do not buy them an annuity

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don't let some sociopath try to sell you an annuity i'll give you one asterisk against that and i do this sometimes i call it the leveraged income monster there are some times that you have the 80 year old grandfather call me up and say stan i want to leave a true legacy

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to my grandson and we've done this on occasion and they'll do a joint life immediate annuity with his three-year-old grandson meaning that the three-year-old grandson is going to get a lifetime income stream as long as they live it's a pretty neat way to do legacy

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but it's a it's a one-off it's an asterisk but overall um i wouldn't be doing uh i wouldn't be doing annuities for your your kids you can do 529 plans you could put it you know in a mutual fund you can talk to your advisor for that but it really doesn't fit and and truly like

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um say the income taking income riders if you're less than 40 years old they really don't there's not a lot of offerings out there the annuity industry is trying to tell the agents don't sell it to the youngsters and lifetime income is based on life expectancy you got to be careful what

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you're buying out there yes there are anomalies yes i do have clients that are younger that they've explained their situation where it does make sense but those are one-offs those are the one to two percents the other 98 of the time you do not do that any other questions

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i'm assuming that's a no hey we're going to no one has any more questions we are going to close this thing out and let you guys go have a good weekend but do me a favor we do this every single month from i mean we've made that decision every single

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month we're going to do the annuity man live that's going to open it up for uh questions and you know i'm going to brutally and actually um answer them if you haven't gotten my books i'm going to send them to you for free and under no obligation go to my site at

41:33

theannuityman.com and sign up for the books we'll ship them to you no one's going to call you show up at your doorstep and also too use the calculators 24 7 365 no limitation on that please do that and don't hesitate to book a call i know it looks scary i'm

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not a good looking guy but it is what it is i blame my parents but i am going to be nice and treat you like a professional and be brutally honest and factual and put together a customized plan for you so with that being said i will see you next month on the annuity man live [Music]

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you