Beware of the Fixed Index Annuity Bonus Churning Strategy: Shootin’ It Straight With Stan

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Welcome to shooting it straight with

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Stan. I'm your host Stan the Annuity

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Man, America's annuity agent, licensed

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in all 50 states in Puerto Rico, founder

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of CGO contractual guarantees only

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because you should only own an annuity

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for what it will do, not what it might

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do. Those are the contractual guarantees

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of the policy. Today's topic is a

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controversial one. It's going to ruffle

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some feathers and bring in the hate mail

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and maybe some death threats. And I

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don't care because you need to be aware

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of it is be aware of the fixed index

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annuity bonus churn strategy.

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You're saying what, Stan? A lot of you

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have seen me go off on upfront bonuses.

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I call them candy for the stupid.

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Um, there's 100 pennies in the dollar.

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There's not 120 pennies in the dollar or

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140 pennies in the dollar. We'll send

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this old boy down the road had one for

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50% upfront bonus. There's not 150

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pennies in the dollar.

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There's not an there's not a a

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philanthropist CEO at a at an annuity

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company that wakes up in the morning go,

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[snorts] you know what? I'm going to

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give money away today. I'm going to take

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good money from our company and give it

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to the consumer. No, they're not doing

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that.

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If if there's an upfront bonus involved

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with a fixed index annuity, they're

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taking something away. Whether it's the

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payout on the income side, if you put an

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income writer, something something's

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going on.

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Life insurance companies that issue

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annuities are forprofit.

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And we, you know, we sell more index

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annuities than anybody, but we ignore

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the accumulation side. We look at the

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income writer side. Draw along down a

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blank blank sheet of paper. Index

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annuity side, cap, spreads,

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participation rates, who cares? income

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writer that this is the delivery system

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for the contractual guarantee. The

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income writer is what we quote A+ or

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better and we choose the highest number.

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We could care less about the index side.

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We could care less about the bonus

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if the if the index annuity with the

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bonus with the income writer finishes

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first and the quote great who cares. I

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get these calls all the time. People

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say, "Well, you understand? I really

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like the the income writer we bought. It

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looked like it had a bonus on it." I'm

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like, who cares? It doesn't matter. You

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We're looking at the number. I mean,

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if you're buying an annuity for a bonus,

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it's like buying the car for the stereo

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system. It's like going to the lot and

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going, "No, no, no. I don't care about

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the transmission or any of that. Show me

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the stereo system. I'm going to buy this

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brand new car based upon the stereo

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system." That's buying an annuity for an

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upfront bonus. I had a consultant come

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in the office because they're always

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coming in the office because they don't

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have they don't know how this redneck

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does it. How's that big redneck do that?

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How's he do those numbers? Why is he

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number one? Well, first of all, I tell

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the truth. Second of all, we quote all

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carriers. Third of all, we have the best

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website on the planet that allows you to

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run quotes without putting in your

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information, your personal information.

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Like for instance, give you an example.

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You're like, "What? Give you an example.

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You can run income quotes with just your

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date of birth, your gender, and your

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state of residence. Everybody else wants

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your email and your phone and they want

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you to sign up and create an account and

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track you and cross-ell you. How about

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you just get some information and I have

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the confidence in you to give us a shot

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at your business. How about that? How

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about having some confidence?

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I'm not building a database. I don't

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care about that. I'm not selling leads

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like these other people do. Be careful

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where you sign up. Your lead goes for

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about $150 to $300 a shot and they give

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it to six to seven people, which is why

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your phone rings off the hook.

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The disturbing part about this video is

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I heard the other day because I, you

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know, people will call me up and they

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say, "Well, Stan, you know, this uh I

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bought this index new with the upfront

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bonus and I shouldn't have bought it,

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but this old boy down the road said, you

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know, if you go with him, he'll get me

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another one." And um it's a bigger

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bonus. And you know, the whole story,

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the whole churning, twisting,

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miss, you know, missenthrop story,

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you're like, "Oh god." And and for a

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while, yeah, shoot, decades, I've been

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saying that's that's illegal. They can't

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do that. They can't do that because when

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you go from one annuity to the other,

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you have to prove at the receiving

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annuity company that this one here is

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better contractually, keyword,

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contractually, not hypothetical, not

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theoretical, not unicorns chasing the

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butterflies, it's better here than where

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you came from.

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So when So when the agent says you're

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going to take these huge surrender

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charges and we're going to make up for

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it with this upfront bonus,

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total garbage. It's still total garbage.

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The person should lose their license for

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that. My opinion, but what I found out

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the other day,

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what I found out the other day

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was disgusting.

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I'm trying to get the actual hard copy

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agreement of this, which I don't have.

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So, take it for what it's worth. It

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might not be true, but I think it is.

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There's an agreement between carriers to

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allow that churn,

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to allow that nonsense recommendation

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for it to go through.

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And you're saying, Stan, why would an

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agent adviser do that? Aren't they

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acting as a fiduciary? They should be

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fiduciary. All that means it's not a

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plaque on the wall. Who cares? It means

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putting your best interest ahead of the

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advisor agent. That should be automatic

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in the financial business. You don't

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need a plaque on the wall to do that.

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When you show up to work and you decide

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to be in the financial business, that

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should be it. What I'm finding out right

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now,

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and I'm trying to track down the

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internal stuff on this, is there's

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agreements that they'll accept the

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churn,

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I'm hoping

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and praying that that's not true

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because that's one doozy of a class

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action lawsuit if it's true. I'm hoping

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it's not true.

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But ironically, I'm getting more and

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more calls from people where they have

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they have a 10-year surrender charge.

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They're in year three, which means the

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surrender charges are so predatory

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and they're being

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recommended to flip it. I saw one the

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other day and to the husband's credit,

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he calls me up and he goes, "Stan, this

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is a nightmare, but it's my wife's

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account and this guy's convinced her to

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do it because I'm not he was she thought

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he was a good religious person. That's a

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whole another video."

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She took a $79,000

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surrender charge to go to another

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annuity for the bonus

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and it went through.

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So, of course, it went because I told

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the guy, I said, "Don't even worry about

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it because it's not even going to go

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through." He calls me back two weeks

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later. It went through. Stan, you got to

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be kidding me. which led to me phoning

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people and a couple of people said,

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"Yeah, there's kind of an agreement

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right now going on." Like, I don't know

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if it's a hush hush, if it's a

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handshake, but if it's an email, if

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somebody put it in writing, I'm going to

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find it.

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I'm going to change this industry. This

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is a bunch of crap.

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Well, yeah. Well, I know you got

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surrender charges. It's upfront bonus,

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son. It's going to Most upfront bonuses

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go to the income account, not the walk

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away account. Income accounts monopoly

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money. Who cares?

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You say, "Well, Sam, why would they do

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that? Why would they?" Because they

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don't know how to raise money. They

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don't know how to do it the right way.

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They don't know how to properly go about

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acquiring clients and doing the right

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thing.

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So, they take the annuities they sold

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three years from now and go back and

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flip them and then three and then go

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back and flip and they just churn the

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book and churn the book and churn the

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book and churn the book.

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I'm hoping that the vast majority of

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good carriers don't allow that. I'm

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hoping.

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But the fact that any allow that any.

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And that and what prompted this video

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was that $79,000 surrender charge case.

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I've been doing this a long time. I'm

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the top agent out here. It's not even

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close. That one blew my mind. So, what

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I'm trying to tell you and warn you

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about is there is a strategy right now.

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I don't know who the carriers are. I'm

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hoping it's not many, but it might be a

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couple. Had to be these people. I'm not

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going to mention the names of the

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company. I do know them if you want to

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email me or give me a call.

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But that's nuts.

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That is absolutely nuts

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if you're under surrender charge most of

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the time. And I get these calls all the

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time. I had two yesterday where the

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people were buried in an index annuity

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that's not performing. Of course, it's

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not performing. They're CD products, bad

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CD products. That's okay. It's principal

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protected, but these people didn't have

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income writers on them. So, I'm like,

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just start taking out the 10%. Just

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start taking money out every year. 10%

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penalty-free withdrawal so you don't

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have to pay the surrender charges. Well,

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this will bo down here so I can get an

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upfront bonus. I'm like, oh lord.

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Oh, lord.

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That's the reason I'm growing the gray

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goatee.

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the annuity goatee.

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And I love what I do. I do. But I guess

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it's like um you know, policemen love

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what they do and they see horror

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stories. Or doctors love what they do

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and they see stuff in the emergency room

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that just curdles milk. I love what I

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do. I'm good at what I'm what I do. I

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tell the truth. But there are some

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things that I see that are disturbing

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that I have to warn you about.

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Never. And I I want you to listen to me.

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Never.

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I'm g say 99% of the time. 99% of the

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time you should never move an annuity

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that's under a large surrender charge to

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another annuity for an upfront bonus. If

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there I'm I'm leaving that 1% that some

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math weird math that works. But the math

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has to work.

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Typically the only math that works

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coming from a an annuity with large

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surrender charges to an annuity another

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one with surrender charges. The math

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only works for the agent and the

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built-in commission. I'm gonna squash

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this stuff, man. It's not It's not going

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to happen anymore. I'm I'm going to call

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it out. I'm going to call it out

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and I'm going to find out

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except for this now. I know I know a

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couple carriers. I'm going to find out

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how many are involved

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right now. know the top the good

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carriers, the top level carriers aren't

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doing this and I hope they don't. But

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some of the meandering lower level

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carriers are doing this and it's

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nonsense.

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So be careful out there. If it sounds

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too good to be true, it is every single

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time. Do not buy annuities for growth.

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Buy them for the contractual guarantees

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only. Do not allow someone to flip and

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churn your annuity for an upfront bonus.

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And if they're pitching it, show it to

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me. We'll run the math for you and show

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you that it's garbage.

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But you got to be careful out there. We

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want you as a client. If you're

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considering annuities, we want you as a

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client. We want you to consider us. I

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have the biggest and best staff in the

11:39
country, all under one roof in Las

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Vegas. We're open 12 hours a day, eight

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hours on sun on Saturday. That's 68

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hours a week around your schedule. Right

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now, we're fortunate enough to be

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running same day applications. I'm

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hiring as fast as I can do, but we can

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get to you.

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Go to my site and run anonymous quotes

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and get real quotes.

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I'm I'm I'm trying to think about how to

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change this thing and I'm going to. And

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I appreciate you tuning in. That's

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shooting it straight with Stan.

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See you next time.