Do Annuity Rates Fluctuate With Interest Rates?

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Hi there, Stan the Annuity Man,

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America's annuity agent, licensed in all

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50 states in Puerto Rico. The question

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of the day is a good one. How do annuity

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rates fluctuate with interest rates?

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Stain, I think I know this one, son.

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I've been studying the Fed for years. I

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know it.

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Don't think you do. And that's a good

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thing because I'm getting ready to

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educate you and edgain you on how

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annuity rates are actually affected by

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interest rates after this.

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Okay. So, the first thing you need to

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know about annuity rates,

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there's two types of rates.

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Okay. You say, "What are you talking

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about?"

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Well, there's payout rates which are for

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lifetime income products like single

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premium immediate annuities, deferred

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income annuities, qualified longevity

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annuity contracts, and income writers.

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Those are called payout rates. And

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payout rates [clears throat] are

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primarily priced on your life expectancy

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singular if it's just you for lifetime

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income or life expecties

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plural if it's you and the spouse. So

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payout rates means life expectancy. So

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there's some sites out there that people

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call me, well this site said that it

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pays out it's the rate the interest rate

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7.82

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on on the SPIA. That's a payout rate

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player. That's not that's not interest.

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That's a payout and that is a numerical

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reflection of your life expectancy.

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Nothing more, nothing less. Now,

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the interest rates, the Fed, the

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10-year, whatever you follow, whatever

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you think you can thread the needle

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with, which you can't with life

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insurance companies, that plays a

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secondary pricing role because life

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expectancy plays the primary life uh

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pricing role. What the life insurance

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company is doing that's issuing the

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lifetime income annuity is they're

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saying, "We think you're going to live

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to here." And you're saying, "I'll take

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that bet. I think I'm going to live to

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here. And if I do live to here, the

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annuity company's on the hook to pay for

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as long as I'm breathing. And I'm going

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to set it up to if I die early, money

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goes to my family. Okay, great. That's

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transferring the risk. But it's all

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about life expectancy. By the way, life

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expectancy tables are in your favor

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right now. Check the time of the taping

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because artificial intelligence will

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change life expectancy to project us to

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live longer. Whether we do or not, we'll

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see. But all the annuity companies will

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care about is that. and then they'll

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lengthen the payments out, which means

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the payments will be lower, which means

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that lifetime income guarantees are a

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bargain right now. But interest rates,

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the Fed, the the 10-year Treasury,

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whatever, plays a minor pricing role

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with lifetime income. Okay.

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Now, let's take Migas, multi-year

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guarantee annuities, which is the

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annuity industry version of a CD. I also

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call it a bond. You can get it's a

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guaranteed interest rate. you lock in

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for a specific period of time and and

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the ones that we show on our site are 1

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2 3 4 5 6 7 8 nine and 10 year terms.

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You can lock that in. The reason I do

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all of them like that is I the other day

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I did one I did a video and I said you

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you know one to 10 years and so of

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course the guy calls me and goes why

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don't you offer the ones that are two,

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three, four. I'm like oh good gracious

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you're a voter. Oh my gosh. Um, but with

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MAS, they're CD products.

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Interest rates don't play as large of a

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role as you think. With the banks and

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and and the the places, the credit

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unions that issue CDs, it's the Fed,

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it's the 10-year, that's what they're

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looking at. With MAS, remember, issued

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by life insurance companies. So, they

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have many pricing levers and profit

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levers to pull from. Life life

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insurance, very profitable. Lifetime

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income, very profitable. legacy bond

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portfolio profitable um mortality uh

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pools credit you know as the mortality

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mortality risk pools that they have

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profitable and then after that you have

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the interest rates

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so interest rates play 20 25% pricing

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role in MAS every time there's a there's

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an Fed increase we'll see we'll see um

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MIA rates decrease sometimes or or vice

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versa

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because it doesn't play a a primary

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pricing role. If you take one thing away

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from this is that interest rates play a

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secondary role in the pricing of

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annuities. Period. I'm not going to talk

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about variable annuities and registered

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index annuities and indexed annuity

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nonsense growth sales pitches. Garbage.

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Who cares? Doesn't matter. You shouldn't

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be buying them for life for uh growth

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anyway. Do not buy annuities for market

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growth. Buy annuities for contractual

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guarantees. Market growth should not

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have surrender charges attached to them.

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They should be in the market. You should

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be in the market. Go get no load mutual

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funds. Go get 100% liquid ETFs and

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stocks. Have someone manage your money.

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Go do it. But market growth for for um

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with annuities. Give me a break. It's a

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joke.

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And I get blown up on all the social

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media platforms by all the adviserss of

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which I'm told by my social media person

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because I'm not on those, but I'm told

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they blow me up. And my first comment

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is, do they not work?

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Do they not manage the money? Why are

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they so mad at me for pointing out an

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obvious fact? Why don't they just go to

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work and manage the money?

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Why are they defending the ground that

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they can't defend factually?

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Annuities are contracts. Annuitities

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should be owned for what they will do,

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not what they might do. Annuitities

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solve for four things: principal

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protection, income for life, legacy, and

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long-term care. Annuities, you should

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only ask two questions. What do you want

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the money to contractually do? And when

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do you want those contractual guarantees

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to start? If you want to go down the

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rabbit hole and really educate yourself,

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I've done thousands of videos. You can

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go to my You can go to my YouTube

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channel and type in in the space bar

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what you want to learn. You can go to my

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site at theanuityman.com and download

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the six owners manuals. You can email me

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[email protected].

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You can schedule a call with me. 30

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minutes. No cost, no obligation, no

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pressure, just the facts. That's it.

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But better than that, is there anything

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better than that? Maybe new to our site.

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You can you can run quotes without

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putting in your personal information and

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get real quotes, live quotes,

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contractual quotes. I'm not here to

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build a database. I'm here to change the

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industry. Okay?

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If you want to schedule call, great.

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But, you know, my life doesn't doesn't

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revolve around how many email addresses

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that I have. It's pro I don't even know.

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It's it's a huge number. I don't care.

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I want you to be able to to run quotes

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on your terms and your time frame. And

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if you're like me and you don't want to

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put in your information, then don't.

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We don't sell it anyway. We don't share

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it anyway, but I get it. Last thing, I

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have the biggest staff in the country. I

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saw someone did a

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did some like review of me and they they

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talked about me like I'm this guy in a

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in a van down by the river. Like just

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me. is me and some assistant somewhere.

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You got to be kidding me. We have a full

7:33
building in Las Vegas, Nevada. We're

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open 12 hours a day, Monday through

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Friday, and eight hours on Saturday. And

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every single person, including the

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receptionist, is licensed in all 50

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states. Why? Because they have to be

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legally to speak with you. And anyone

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else speaking with you and they're not

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licensed in all 50 states, they're

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breaking the law.

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Yes, my receptionist is licensed.

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So when you look at how interest rates

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affect annuities

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marginally, secondarily, but it doesn't

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drive the pricing train. Remember that

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annuities are non-correlated to the

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markets. They're issued by life

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insurance companies. Do me one last

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favor. Um above my head's a spinning

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clock. There's a video I want you to

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watch. It's called Hey Annuity haters,

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attention. You already own an annuity.

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You need to look at that. Live it. Love

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it. Learn it. Be it because it's the

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truth. My name is Stan the annuity man.