Stan The Annuity Man: The Psychology of Buying Annuities

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[Music]

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foreign

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with annuities where every single week I

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welcome a celebrity guest expert that

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can help you maximize chapter two of

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your life listen learn laugh and love

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every minute of the most unique

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Financial podcast on the planet let's

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get to it

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[Music]

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welcome to fun with annuities I am your

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host Stan the annuity man America's

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annuity agent licensed in all 50 states

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so glad that you joined me this week

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either you're on the fun with annuities

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YouTube channel and you're looking at my

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red Stan the annuity manhatt or you're

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on all major podcast platforms and

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you're envisioning the red hat

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today we do not have a guess the guest

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is me I'm interviewing myself I did this

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recently a couple of times

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um because there were some topics that I

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needed to cover that there really wasn't

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a guess to

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um that qualified to answer the

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questions except for me were there again

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in my opinion and this is a very

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important topic to the point where I had

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to yell at my PR team to say hey

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I know we got all these guests lined up

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I know that these people are fantastic

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and all these books and done of these

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things and gone on these nice fancy

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colleges that I could never get in I get

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that

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but being staying the annuity man and

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doing this for a long long time

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um I have talked with tens of thousands

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of people

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in other words I've been to most rodeos

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I have

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um heard most cases

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um saw for most specific Solutions even

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the Unicorn ones that are from Left

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Field

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but in the annuity industry

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unfortunately there's more of a you know

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a lot of hammers looking for nails

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there's just people selling stuff

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they've chosen their product to choice

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and they're selling it period And I

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think that's a problem and I think

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that's

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um part of the reason the annuity

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industry has earned this bad reputation

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but that doesn't describe everyone in

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the annuity industry but what I wanted

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to talk to you about today was the

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psychology

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of the annuity purchase so you know I

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think I have a little bit of background

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in that because I've been doing this a

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long long time and I have listened to my

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clients I use my ears and mouth in

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proportion so I'm always listening I'm

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always trying to hear exactly what

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they're trying to solve for and break

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break it down to what they they need

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and then I'm very curious just because I

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think it's fascinating the process of

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the decision being made now one of the

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things here we do at the annuityman.com

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we do not high pressure anybody

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you buy your annuity if you're going to

2:49
buy one on your terms and on your time

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frame

2:52
um so if anyone ever says you got to buy

2:54
one now because the bonus is going away

2:55
you got to buy one now because there's

2:57
not you're buying a contract there's no

2:59
urgency to buy a contract but

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there's a lot of psychology that goes

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into buying an annuity and I wanted to

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cover that now my wife is probably

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yelling at me because she's got her

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master's degree in Clinical Psychology

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which might be the reason she married me

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because it might be this project and a

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book that she's writing and or

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screenplay if she's smart not sure it's

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to be just be with me because I'm a I'm

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a handful as they say she's a fantastic

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person a martyr and a masochist all in

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the same same package and the mother of

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my two wonderful daughters 26 and 24 at

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the time of this taping but when you go

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to buy an annuity one of the things you

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have to overcome is all the things

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you've heard I mean I hate on people

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don't over buying annuity annuities are

3:44
terrible all annuities are just bad I

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mean you

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every single time I have someone start

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that they'll schedule a call with us and

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if they get me sometimes you'll get me

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and if you start with that I'll just

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stop you please stop please please don't

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waste my time with well my friend said

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they're all better my advisor said

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they're all bad

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if you've heard any of my videos

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recently

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um or podcasts or you know fun with

4:08
annuities podcasts you already own an

4:11
annuity every every single one of you

4:12
out there with a social security number

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owns an annuity is called Social

4:15
Security it's the best inflation annuity

4:17
on the planet if you have a pension you

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also own another annuity that's a

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lifetime income stream

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and if you own like a CD you know

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there's an annuity version of a CD

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called a multi-year guarantee annuity so

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um I even argue that with requirement of

4:33
distributions when you have to take

4:35
money out of your IRA type assets at age

4:37
73 at the time of this taping that's

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somewhat of a forced annuity so the

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first thing you have to overcome is just

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you know I hate all annuities type thing

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okay which is nonsense or or all

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annuities are expensive nonsense all

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annuities are bad nonsense that's like

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me saying all stocks are bad or bonds

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are bad all mutual funds are bad all

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trucks are bad all socks and shoes are

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bad all restaurants are bad

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it's nonsense and you know that and

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that's probably the reason you're you're

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you're too you've tuned in a lot of you

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are tuning in because you're thinking

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about buying an annuity you've been

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pitched an annuity locally probably or

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by your advisor out of the blue all of a

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sudden your advisor is trying to sell

5:15
you an annuity you're like wait a minute

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what do I really want to do from this so

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the fact that you already own you're

5:23
already an annuity owner should give you

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pause and say okay I already have a

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lifetime income stream oh I'm already

5:28
transferring risk for Lifetime income

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but what I also want you to think about

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in the psychology of buying and annuity

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you're not buying an investment you are

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buying a contract you are transferring

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risk to the annuity carrier to sell for

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four primary things

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I have an acronym easy to understand

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pill P stands for principal protection I

5:49
stands for income for Life L stands for

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Legacy and the other L stands for

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long-term care or confinement care pill

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principal protection Inc for Life Legacy

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and long-term care

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notice there's no G in there there's no

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s for stock there's no M for Market I

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mean annuities are not market products

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now there's arguments that can be made

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that a no load variable annuity

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that was put on the planet in 1954-1955

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and that time frame by TIAA for text for

6:15
growth mutual funds inside of a life

6:18
insurance annuity wrapper for tax for

6:20
growth yes there's an argument for that

6:22
but there's there's a handful of no load

6:25
variable annuities left most variable

6:28
annuities sold come with a an average

6:30
three percent annual fee for the life of

6:32
the policy every single year so that's

6:34
what annual means and I don't sell

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variable annuities because I don't sell

6:38
anything that has the potential to go

6:40
down because my saying is you own an

6:41
annuity for what it will do not what it

6:44
might do and the will do or the

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contractual guarantee is the policy and

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the might do is the hypothetical

6:48
theoretical back tested proposal hopeful

6:51
agent return scenario of unicorns

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chasing the butterflies

6:55
and it never happens so those back

6:57
tested numbers Hey if you'd owned it 10

6:59
years ago this is what you you would

7:01
have gotten look at that Mr Jones

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in a lot of States that's not even

7:05
allowed in my perfect world

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you know once I hang up the annuity

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boots as they say I'm hoping to have

7:11
been the impetus for that back tested

7:14
number stuff to be outlawed illegal not

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you know you just can't do it as an

7:19
agent because it's nonsense

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I had a good friend in college that used

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to

7:24
every you know every week or so he would

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write out this really good workout plan

7:27
I mean just really good you know here's

7:30
what working on my triceps and biceps

7:32
and then work on my legs the next day

7:33
and I do cardio he never he never did it

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okay that's the best back tested

7:39
um exercise plan of all time it's worth

7:41
as much as these back-tested annuity

7:43
things you see out there as well

7:45
so don't get you know when you're when

7:47
the psychology of of buying an annuity

7:51
is the first thing you have to

7:52
understand you own a new the second one

7:54
is to filter out the sales pitch

7:57
in a perfect world and where I'm leading

8:00
the annuity industry is where annuities

8:02
are bought not sold in the future

8:05
in the future you're going to be able to

8:08
just buy annuities of all types there's

8:11
many different types of annuities

8:14
um of all types

8:16
and you're going to have enough

8:17
education from people like me that's

8:19
done thousands of videos and thousands

8:21
of Articles and written seven books so

8:23
you can be educated before you make the

8:25
purchase but currently if you're buying

8:28
locally or if you're even on the

8:30
internet and just I mean there's some

8:32
horrific sales pitches out there you've

8:35
got to filter out a lot of those too

8:37
good to be true sales pitches and that's

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part of the psychology of buying it is

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okay I know I want more lifetime income

8:44
or I know I want principal protection or

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I know I want to set something up for

8:49
legacy because I can't qualify for life

8:51
insurance or I know that I want

8:53
something for long-term care or

8:55
confinement care something like that

8:57
I've got to filter out these sales

8:58
pitches that I'm hearing that are too

9:00
good to be true

9:01
that just sound phenomenal and I'm

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nudging my my spouse going wow that's

9:06
fantastic I mean why wouldn't we buy it

9:08
if you're in that mode of saying that

9:10
then never buy that product ever because

9:13
it's not going to come true and you got

9:16
to ask yourself it was that good then

9:17
that's all Goldman Sachs and JP Morgan

9:19
and Credit Suisse and the government

9:21
that's all they'd buy

9:23
okay if it sounds too good to be true it

9:25
is so part of the psychology is to is to

9:28
understand that you own one okay Social

9:31
Security you might own two with with uh

9:32
the pensions you might have if you

9:34
consider rmds three and then you got to

9:37
filter out the sales pitch of the person

9:38
that's pitching possibly a too good to

9:41
be true product one of the things you

9:43
have to remember with the annuity

9:44
purchase in the psychology of it is to

9:47
put in your mind that annuities

9:51
plural there's many different types you

9:53
can't just earn a little nude there's

9:55
many different types they're commodity

9:57
products meaning that you need to shop

9:59
all carriers for the highest contractual

10:01
guarantee for your specific situation

10:04
and remember that quotes change like a

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gallon of milk every seven to ten days

10:09
companies are trying to attract you

10:13
for whatever reason let's just say it's

10:14
a lifetime income and you either want

10:16
lifetime income to start now or at a

10:17
future date

10:18
companies change their guarantees based

10:22
upon how many of you your life

10:24
expectancy your life expectancies they

10:26
already have in the portfolio I want you

10:28
to think of it like this when you go to

10:30
put together an equity type portfolio or

10:33
full you know investment type portfolio

10:36
you have small cap and mid cap

10:39
value International bonds

10:42
Etc okay with lifetime income and

10:45
annuity companies that issue lifetime

10:47
income products currently there's four

10:49
types primary types single premium

10:51
immediate annuities Spears deferred

10:53
income annuities Diaz qualified

10:55
longevity annuity contracts qlex and

10:58
then income Riders attached to deferred

11:00
annuities when they when they when we

11:03
quote things at the annuityman.com the

11:06
cool thing is we can run it for you or

11:07
you can go to my site at the

11:08
annuityman.com use the best calculators

11:10
in the world and run them yourself 24 7

11:13
365. but they're trying to attract your

11:16
age range for Lifetime income um

11:20
because they need to fill in that

11:21
tranche with your age range or your age

11:23
ranges if it's a joint it's really that

11:25
simple and when they fill it up then

11:28
they're going to lower the guarantees

11:29
not to attract you

11:30
okay now multi-year guarantee annuities

11:33
are the industry's version of a CD you

11:37
know they are looking primarily to go

11:40
get your CD money and they're also

11:43
filling tranches they're filling

11:44
tranches for specific durations and

11:46
specific guarantees for those durations

11:49
so annuity companies won't take all of

11:51
your money in fact the annuity industry

11:54
frowns upon you putting in more than 50

11:56
percent of your investable assets that

11:58
does not include houses rental houses

12:02
land when you go to net worth

12:04
in the annuity business where they're

12:06
they're not looking at net worth house

12:07
car guitar and all that they're looking

12:09
at investable assets brokerage firm bank

12:12
account savings account Roth IRAs

12:14
traditional IRAs non-iras

12:18
Etc that's what they're looking at and

12:19
they frown upon more than 50 can we push

12:21
that more than that can I use a stand

12:23
the annuity man bullet I can if you

12:26
convince me why

12:28
but I'm not sure most agents even know

12:30
that or even care but we we look at that

12:32
very seriously that's also part of the

12:35
psychology of of purchasing an annuity

12:37
is understanding you should not put too

12:40
much money in

12:42
annuities of all types

12:45
okay so when the 50 rule applies to all

12:49
types that applies if you bought a a

12:51
spear A dia a culac and Omega and so

12:54
let's say you bought an index annuity as

12:55
well

12:56
cumulative

12:58
cumulative of all of those products the

13:00
annuity industry does not want all of

13:02
your eggs put into one basket and I

13:04
think that's a good thing it's really

13:06
it's really protecting the

13:08
unsophisticated investor that's getting

13:11
preyed upon by agents trying to take all

13:14
of their money and put it into some type

13:16
of you know High commission long-term

13:19
product that's very very complex

13:22
which leads to another part of the

13:24
psychology of of annuity purchases which

13:26
is if you cannot explain it to a

13:29
nine-year-old or a group of second

13:31
graders no offense to either of those

13:32
then you should not buy it

13:35
it amazes me to this day how many people

13:37
will call because we have a button on

13:40
our site called second opinion you

13:42
literally can get a second opinion on

13:44
either what you own or what you're

13:45
considering to purchase and we'll give

13:47
it to you and we'll be brutal as my

13:49
grandfather always said if you tell the

13:50
truth you're not you don't have to

13:52
remember anything that's our business

13:53
model we tell the truth if you don't

13:55
need an annuity great we'll tell you

13:57
that if you need one we'll show you the

13:58
best and highest contractual guarantee

14:00
if you give if you show us something and

14:02
it's a second opinion call and it's a

14:04
good recommendation we'll tell you it's

14:06
a good recommendation or we'll tell you

14:08
if it's crap

14:09
and we we really will do that so part of

14:15
part of the psychology of buying an

14:18
annuity is

14:19
is trying to figure out what type is the

14:22
best and the second opinion call if

14:24
you've been pit something we can walk

14:25
you off that Cliff before you jump off

14:28
and trying to catch the butterfly and

14:30
you're going to get the contractual

14:31
realities

14:32
it's very simple

14:35
to determine

14:37
if you need an annuity period and it

14:40
comes down to two questions and the two

14:41
questions are what do you want the money

14:43
to contractually do

14:45
and when do you want those contractual

14:48
guarantees to start Give an example if

14:50
you answer the first question income

14:53
and the second question you need to

14:54
start it now you're down to one product

14:56
that's a single premium immediate

14:58
annuity it's going to provide the

15:00
highest contractual guarantee period you

15:03
know if you said I want income and I

15:05
want it to start at a later date like

15:06
five years there's four ways to solve

15:10
for that I've done videos on on all four

15:12
ways to solve for that if you said I

15:15
just you know I want um principal

15:17
protection and I want it to start now I

15:19
mean that's either multi-year guarantee

15:21
annuities or fixed index annuities in my

15:24
opinion multi-year guarantee annuities

15:26
are a better decision because the

15:28
returns are contractual they're going to

15:31
happen

15:32
all right so part of the psychology of

15:36
Vine annuity is understanding you're

15:37
buying a contract and putting your

15:40
rational thinking cap on and and taking

15:42
off the cap that's looking for the best

15:44
product ever looking for the product

15:46
that does everything and believing a too

15:49
good to be true sales pitch

15:52
stripping all of that down another way

15:54
you can you can strip all of it down is

15:56
to ask for a specimen policy ask for all

16:00
of the paperwork and the specimen policy

16:02
so you can do your due diligence and

16:04
read the specimen policy enough spoiler

16:07
alert on that specimen policies are the

16:10
verbiage the words of the policy so if

16:13
you say Stan I really like that

16:15
immediate annuity that we talked about

16:17
and you sent quotes on

16:19
okay great and you want a specimen

16:21
policy we're going to send you that but

16:23
it's just going to be the words it's not

16:24
going to have your name or the numbers

16:26
you know the specific numbers of the

16:28
amount dollar amount but it's going to

16:29
have all the verbiage in there now that

16:31
leaves a lot of you to say wait a minute

16:32
wait a minute psychology stand I feel

16:34
like I'm getting duped here if I'm

16:35
having to send the money and I can't see

16:38
the policy before the you know before

16:40
that well you're going to see the policy

16:41
without the numbers but the good thing

16:43
about the annuity industry is every

16:46
state has what's called a free look time

16:49
period and what that is is you're you

16:51
can test drive that annuity in other

16:53
words a policy can be issued to you in

16:55
your hands

16:57
you know it's in force the contractual

16:59
guarantees are in force and depending on

17:02
what state you live in you can get all

17:04
of your money back without question

17:06
all you have to do is just call the call

17:09
us up if we were a part of that

17:10
transaction or call the Carrier and say

17:13
I would like my money back under the

17:15
free look provision you don't have to

17:16
give them any reason explanation in

17:21
writing you just have to say under the

17:23
free look provision I would like my

17:26
money back and it in annuities

17:28
are the only financial product that lets

17:31
you test drive the annuity while you're

17:33
owning it and you can return it

17:37
I have no idea why the annuity industry

17:40
has not pounded the table on that

17:42
specific item that's

17:45
that's phenomenal I mean and with eleven

17:48
thousand Baby Boomers hitting age 65

17:50
every single day

17:52
and you're considering an annuity and

17:55
you've gone through the proper steps and

17:57
rational steps of shopping for them

17:58
having this quote all carries for you

18:00
deciding on a carrier Etc to have the

18:04
the ability to Pivot out of that

18:07
contract and get your money back without

18:09
question

18:10
is unbelievable and it's a value

18:12
proposition with in the annuity industry

18:15
that

18:15
if I was the annuity Czar boy we'd be

18:18
talking about that we'd be talking about

18:19
the free look provision we would be

18:22
talking about

18:24
um the contractual guarantees of the

18:25
policy and buying solely for that we

18:27
would be talking about shopping all

18:29
carriers for the highest contractual

18:31
guarantee we would be talking about

18:34
how you choose carriers from carrier

18:36
strength I have a very easy way to do

18:37
that which is date the rate and marry

18:40
the lifetime income so if we're going to

18:42
buy a fixed rate annuity like a

18:44
multi-year guarantee annuity we're just

18:46
going to date that carrier for that

18:47
specific period of time then we're gone

18:49
but if we're going lifetime income we're

18:51
going to marry that company so we're

18:53
going to date the rate or marry that

18:54
lifetime income if we're marrying the

18:56
lifetime income we're really going up

18:58
the food chain from a quality standpoint

19:01
um you know what a plus a double plus

19:04
whatever we decide that uh that that you

19:07
feel comfortable with and certainly when

19:09
we recommend stuff we're you know we're

19:10
recommending things that we've looked on

19:12
under the hood of that company the

19:15
financials not just looking at the

19:17
letter grade I do have a background with

19:19
Morgan Stanley Deanwood or Payne Weber

19:20
UBS in a previous life that I can look

19:23
under the hood and look at the

19:24
financials and I can tell you if I feel

19:27
comfortable whether we're dating the

19:28
rate for a fixed rate annuity or or

19:30
we're marrying the company for Lifetime

19:32
income okay

19:34
um the other psychology part about

19:37
annuities that's tough to overcome is is

19:40
realizing that this is not these are not

19:43
Investments they are contracts

19:46
you're not looking at them like market

19:48
products where you're trying to time it

19:50
and they're trying to find a sweet spot

19:52
and trying to find an Arbitrage moment

19:54
where you're going to beat the life

19:56
insurance company that issue annuities

19:57
by the way life insurance companies

19:58
issue annuities but you're you're never

20:01
going to beat them I need all you Gordon

20:03
geckos all you Masters of the Universe

20:05
out there with really high I accused you

20:07
need to listen to me you're never going

20:10
to beat them

20:12
life insurance companies have the big

20:13
buildings for a reason they have logos

20:15
on the private jets for a reason and

20:18
they sponsor sports stadiums for a

20:20
reason and that reason is life insurance

20:21
companies that issue annuities know when

20:24
we you are going to die

20:27
as opposed to Property and Casualty

20:29
companies that don't know when the

20:30
hurricane or fires are going to hit they

20:32
just don't and that's the reason that

20:34
life insurance companies

20:36
they're not smarter than Banks or or

20:39
smarter than brokerage firms they just

20:41
have a rigid business model based on

20:43
life expectancy okay

20:46
um and they're also highly regulated I

20:48
always tell people you know when we have

20:50
typically we'll have banking crisis come

20:52
and go and they'll call and say well you

20:54
know should I be worried on a run on the

20:56
insurance companies no you shouldn't

20:58
they're they're more regulated than

21:01
Banks number one

21:03
um they're more handcuffed not to do

21:05
stupid things than Banks they're not

21:08
better than Banks I just think they're

21:09
just more regulated and their business

21:11
model is is different because they can

21:13
price off many things but most of the

21:15
time it's on life it's on life

21:18
expectancy okay

21:20
interest rates with most of products

21:23
types play a secondary pricey role so

21:25
you can't compare these

21:28
two Investments let me give you an

21:30
example this is a this is one of the

21:32
psychologies of buying annuities if

21:34
you're buying a lifetime income stream

21:36
and I saw an article the other day of

21:38
the person that I had on my podcast and

21:40
he put out an article I called him up

21:41
and like you might be a professor but

21:43
that was not a good article it wasn't

21:45
smart at all he was comparing

21:47
Q lacks or deferred income annuities

21:49
which are lifetime income products to

21:51
Investments and running Monte Carlo

21:54
simulations

21:55
non-non-guaranteed return scenarios

21:57
against

21:59
qlex and and lifetime income streams

22:02
that's that's such apples and oranges I

22:04
can't even see straight that's

22:06
ridiculous he's comparing pensions to

22:09
potential those p's don't line up and I

22:12
know it's I know it's commonplace in in

22:15
um the financial services business

22:18
to do that I was talking to a guy the

22:21
other day after I had explained what I

22:23
would recommend for him and his his wife

22:26
and it was so simple

22:29
he was dumbfounded in fact he said a lot

22:31
of times when I talk to people they're

22:32
like it can't be that simple stand

22:34
there's just no way I'm like that's kind

22:36
of the gift I had I can break it down

22:39
in my opinion

22:41
the only complexity with annuities and

22:45
financial products as a whole are the

22:48
people trying to sell those to you

22:50
they're the ones that are making it

22:52
complex

22:53
when you're talking about contractual

22:55
guarantees and making a decision the

22:57
psychology of buying an annuity and

22:59
you're basing it on contractual

23:01
guarantees it really comes down to are

23:03
those contractual guarantees fair or not

23:06
are those contractual guarantees going

23:09
to get me where I want to get to from a

23:12
lifestyle standpoint

23:15
chapter two of your life chapter two has

23:17
got to be all about you

23:19
all right another psychology hurdle that

23:24
you're going to have to deal with is the

23:26
safety of the companies I love it when

23:28
people go

23:29
I had a gentleman the other day and we

23:31
got to the Finish Line he goes well

23:33
stand before you start running quotes

23:34
let me just tell you something son

23:37
um don't you put some crap annuity

23:39
company in front of me I'm like listen I

23:41
said listen for it

23:43
um you sound like a really nice guy but

23:45
trust me I'm not going to put my license

23:47
on the line for you or your wife I'm

23:49
going to recommend someone that I sign

23:51
off on whether we're dating the rate or

23:54
marrying the lifetime income

23:55
so let's that's a given

23:58
okay but when we talk about the

24:01
psychology about an annuity a lot of it

24:02
is stand safety what's the safety Stan

24:05
I'm really really comfortable with FDIC

24:08
or s-i-p-c FDIC is like CD coverage sipc

24:14
is brokerage type coverage that type of

24:16
insurance okay those are great and those

24:20
are better than anything that the

24:22
annuity industry has the annuity

24:23
industry the fixed annuity industry

24:25
fixed annuities are regulated at the

24:28
state level and those backings of those

24:30
of those companies vary state to state

24:34
but State guarantee funds is what they

24:37
call them cannot be used in a sales

24:40
presentation we can't even bring them up

24:42
in conversation when we're talking to

24:44
you about a potential purchase unless

24:46
you bring it up okay so you can you can

24:49
fill in the blank on that I always tell

24:51
people State guarantee funds are like

24:53
where like your uncle Uncle Louie that

24:56
comes to the family reunion where all

24:58
the Watergate salad and the potato salad

25:01
and the casseroles man I love that he

25:03
come and he have a pair of suspenders on

25:06
annabelt just in case right we loved him

25:10
everybody out there is like I got that

25:12
guy that I know who that is in my family

25:14
Belton suspenders to me

25:17
we're going to remember date the rate or

25:20
marry the lifetime income we're going to

25:22
choose a carrier and recommend a carrier

25:24
that we believe based on my long-term

25:28
decades experience of looking at

25:29
financials of these companies that can

25:32
back up the guarantee so our first level

25:34
of protection and truly in my opinion

25:37
the primary one

25:39
is the issuing company that's issuing

25:42
the specific annuity type that's solving

25:43
for the specific solution of yours

25:46
okay

25:47
State guarantee funds you can do that if

25:50
you feel comfortable listen I was on the

25:52
phone the other day and the guy said

25:53
Stan I know you're you're your take on

25:55
state guarantee funds but just because

25:57
it will make me feel better I want to

25:59
split the purchase up to go underneath

26:01
the state guarantee fund hey

26:03
I'm all I'm down with that I'm good with

26:06
that why it's your money I respect that

26:08
I love advisors that treat your money

26:11
like it's theirs no no it's your money I

26:13
respect it I'm going to give you my

26:14
opinion as you can only imagine but

26:17
if you feel more comfortable under the

26:21
state guarantee fund and put and and

26:23
buying Under that limit that's fine but

26:25
I also love when people go what happens

26:27
when you know a double A Plus company

26:30
mentioned names goes out of business and

26:32
my comment is we're in the grocery store

26:35
fighting for bread the the really cheap

26:39
white loaf bread okay and we're punching

26:42
each other in the face for it because

26:43
there's Anarchy and there's no power and

26:45
for all of you out there go well it

26:47
could happen no it can't no it just it's

26:51
it's nonsense to even talk about it and

26:52
if you and if you talk about and throw

26:54
up uh I'm not going to say companies but

26:57
companies that in 2008 that you all know

26:59
that that acronym of that company that

27:02
that life insurance division actually

27:04
saved the company from the idiot 25 year

27:07
old derivatives Trader it Traders out

27:09
there that almost sank the company if it

27:11
wasn't for

27:12
the life insurance side of the business

27:14
there would be no business and you all

27:17
know what I'm talking about and that

27:19
company that we're that I'm referring to

27:22
so

27:24
the carrier strength the psychology of

27:26
not having sipc or FDIC and and basing

27:31
your decision on Carrier strength and my

27:33
recommendations as our recommendations

27:35
as a company is a big one but I'll tell

27:38
you this just remember that all types of

27:42
annuities are confidence products in

27:44
other words

27:45
I'll give you an example if my mom in St

27:47
Augustine Florida who just turned 84

27:49
years old and walked six miles a day if

27:52
her annuity stopped paying the annuity

27:55
business would be out of business

27:56
because she first of all I don't do

27:59
business with my mom but I'm just saying

28:00
if she owned an annuity the point is she

28:04
would get on every television station

28:06
and just say they took my money they

28:08
took my money I'm not getting my money I

28:10
mean it would be at that time oh my gosh

28:12
the annuity companies are aware of that

28:14
they're aware of my mom they don't want

28:16
my mom going on TV or people like my mom

28:19
going on TV and go that dude come took

28:21
my money my point and where I'm going

28:23
with this even though I like kind of

28:25
talking like my mom sometimes is the

28:28
annuity industry self-polices they they

28:31
oversee the big companies absorb the

28:34
smaller companies the Golden Goose of

28:37
confidence is not going to go away

28:39
all right so I really believe what I

28:41
call the annuity Mafia the annuity

28:43
industry hates it when I talk like that

28:45
it's not the annuity Mafia you you

28:47
should not use the word mafia you just

28:50
should not

28:51
I'm like I'm going to because I'm from

28:52
the south and I love mafia movies and it

28:55
makes sense the annuity Mafia is the big

28:57
guys cleaning up the mess if there are

28:59
messes and what we've seen in the past

29:01
that are small small companies low low

29:03
rated companies that have been absorbed

29:06
by the state guarantee fund the big

29:07
companies coming to swoop in and buy

29:08
them

29:10
Okay so big hurdle psychologically is

29:15
the safety where are you putting the

29:17
money is the money safe especially if

29:19
you're in your baby boomer you know type

29:21
stage where you know you're

29:24
transitioning from grow grow grow your

29:26
money grow grow grow grow your money

29:29
you know you're going from that to

29:32
safety of your money or lifetime income

29:34
of your money for for your lifestyle

29:37
it's tough that's that's a psychological

29:39
hurdle the other thing that um you need

29:42
to look at in my opinion is a big one

29:45
when it's come to comes to the

29:46
psychology of buying an annuity

29:48
is there should never ever be an urgency

29:52
to buy one I said this earlier in the

29:53
podcast where someone says well you're

29:55
going to miss out on that upfront bonus

29:57
Mr Jones if you don't sign the paperwork

29:59
garbage crap walk out of that or

30:02
whatever the pitch is if there's a time

30:05
frame on it

30:06
and they're pushing you whoever is

30:08
pushing I don't know why you wouldn't

30:09
use us use us we don't do that we're the

30:11
number one sellers out here of annuities

30:13
use us we never do that there's no

30:16
urgency and what if that contractual

30:19
guarantee that that has been locked in

30:22
um expires big deal we'll lock another

30:25
one in okay so there's no urgency do not

30:27
be forced or pressured to sign anything

30:31
you sign

30:33
what you want to sign you sign what you

30:36
want to sign and when you want to sign

30:38
it period

30:40
no exceptions

30:43
people always say to me and we said I

30:45
said this earlier in the in the um

30:47
podcast is no one wakes up in the

30:50
morning which wants to buy an annuity I

30:51
trademark where annuities are are bought

30:54
not sold when when you work with us

30:56
you're going to buy the annuity you're

30:57
not going to be sold the annuity you're

30:58
going to buy the annuity what do I mean

31:00
by that we're going to provide you as

31:01
much information as humanly possible

31:03
that's the reason I do these these

31:05
podcasts in these videos and write blogs

31:07
and write books of which you can go to

31:09
my site and get the books

31:11
for free

31:12
it's because we want you educated and

31:15
make an informed decision on your terms

31:17
and on your time frame

31:19
period

31:22
but the last thing I want to close with

31:24
this one when we talk about the

31:26
psychology

31:27
of buying an annuity

31:30
is this it's explaining it to your

31:33
family

31:34
and this is a tough one I want you to

31:36
hang in there with me again I've been to

31:38
the rodeo been doing this decades I know

31:41
it looks so vibrant and young and sounds

31:42
so vibrant young for all you podcast

31:44
listeners on the treadmill

31:47
but I've heard it all and there's a lot

31:49
of times that explaining annuities

31:52
remember there's many different types

31:56
um two loved ones family members spouses

31:59
children

32:01
Etc

32:02
uh lawyers CPAs whoever you're

32:05
explaining the annuity to

32:07
and if it's an advisor if they're if

32:09
they're not open-minded you can probably

32:11
guess where if you said the word annuity

32:13
where it's going to go

32:14
but

32:16
explaining it to your loved ones and

32:18
significant people in your inner circle

32:22
can be tough and you have to be prepared

32:25
for the by for the biases that are

32:29
already in place with your friends and

32:31
family because if you're going to talk

32:32
to them a lot of them will say well

32:34
never buy an annuity I heard you should

32:35
never buy any new s all guy on the TV

32:37
the other day with the ad say never buy

32:38
an annuity

32:40
my advisor said never buy an annuity

32:43
annuities are all bad annuities are all

32:45
expensive all the cliches that are

32:46
incorrect and wrong

32:48
and if you and if you feel like those

32:50
are true then call Social Security and

32:51
cancel your payment because that's an

32:53
annuity as I've explained to you but

32:55
don't be hypocrite about it

32:57
but you have to explain to your spouse

33:00
and kids and CPAs and tax lawyers and

33:02
whoever's you trust in that decision

33:05
with you if you need that that you're

33:07
buying a contract

33:09
you're buying a contract you're not

33:10
buying investment you're buying a

33:12
contract which they're going to say what

33:14
kind of contract is it depending on what

33:16
we're trying to solve for you could say

33:18
it's a contract that solves for Lifetime

33:20
income

33:21
or it's a contract that protects the

33:23
principal and gives us a guaranteed

33:25
interest rate or it's a contract that

33:27
because I can't qualify for life

33:29
insurance it will solve for legacy or

33:31
it's a contract that will provide some

33:33
long-term care confinement care type

33:35
coverage it's a contract it's not an

33:38
investment

33:39
the second thing you need to say to them

33:41
is we are transferring risk

33:44
I want to transfer risk what do you mean

33:46
by that Fred you're family what do you

33:49
mean by that Dad what do you mean by

33:50
that mom

33:53
transferring risk on transferring risk

33:56
to the company that's issuing this

33:58
contract I.E policy to solve for

34:01
principal protection to solve for maybe

34:04
lifetime income

34:05
or Legacy or long-term care you're

34:08
transferring risk well why do we need to

34:10
transfer risk Fred or Fredette why are

34:14
we needing to do that well we transfer

34:17
risk for car insurance we transfer risk

34:20
for homeowners insurance we transfer

34:22
risk for health insurance

34:25
we're going to transfer risk for

34:27
retirement Insurance lifetime income

34:30
insurance or principal protection

34:31
insurance

34:33
like that it makes total sense

34:37
and it's easy to explain

34:39
and if an advisor comes back and said

34:42
you don't need that I can do that then

34:43
the question is how are you Mr advisor

34:46
Master of the Universe going to transfer

34:48
risk how are you going to buy con going

34:51
to provide contractual guarantees not

34:54
hypotheticals or theoreticals or Monte

34:56
Carlo simulations simulations that show

34:59
you know market returns over the last 40

35:01
years who cares

35:06
the psychology of buying annuity not

35:08
only by it

35:10
revolves around you it also revolves

35:13
around your loved ones and how they

35:15
understand the purchase and why you are

35:18
considering making that purchase

35:23
that's a big one

35:26
but I think the biggest one I said I was

35:29
going to close without but but I did

35:31
remember one more thing

35:33
the biggest the biggest part of the

35:36
psychology of

35:37
of um buying an annuity regardless of

35:40
types remember there's immediate

35:42
annuities deferred income annuities

35:43
qualified longevity annuity contracts

35:45
index annuities multi-year guarantee

35:47
annuities income Riders there's all

35:48
kinds of types

35:50
the biggest psychological hurdle is fomo

35:53
fear of missing out

35:55
fear of hearing about your neighbor

35:58
who's lying when they say this say that

36:00
they made 100 of their portfolio or

36:03
hindsight being 2020 if the markets went

36:06
up or if there was a stock that you've

36:08
been following forever but didn't

36:09
purchase and then it went up and you go

36:11
man I should have bought that I knew I

36:12
shouldn't have bought that a new you

36:14
have to overcome the fomo you have to

36:17
overcome the fear of missing out

36:20
and you have to translate and transition

36:23
that fear of missing out on market

36:24
returns of fear of missing out on growth

36:27
potential and fear of missing out on

36:29
hypothetical

36:30
to fear of missing out on chapter two of

36:33
your life fear of missing out on the

36:36
lifestyle that you have earned

36:40
chapter two of your life is about you

36:44
someone said to me today Stan you're

36:46
middle-aged I said I'm I'm 60. I'm not

36:48
living 120 I'm not middle age

36:53
who knows when when you know when the

36:56
the clock stops none of us know always

36:58
tell people there's no U-Hauls behind

37:00
hearses and fly first class or your kids

37:02
will in other words plan on spending it

37:05
structure it to spend structure it to

37:08
enjoy don't keep trying to thread the

37:11
needle

37:12
and keep getting market returns now

37:14
portion of your portfolio can do that

37:16
for sure but you need an income floor in

37:18
place so you don't have to worry about

37:20
about that and there is no threading the

37:23
needle with annuity contracts there's no

37:25
threading the needle with contracts

37:30
so all of these things that I mentioned

37:32
for from the standpoint of the

37:34
psychology

37:35
of annuity purchasing or purchases if

37:38
you've if you're considering buying one

37:40
or additional ones or have purchased one

37:43
and trying to figure out why you did it

37:46
um there's a lot of hurdles you're gonna

37:48
have to overcome the perception hurdles

37:50
the lies

37:52
um you know the family and the in this

37:53
Inner Circle that are probably going to

37:55
shoot it down and just the reality of

37:57
what these annuity contracts are which

38:00
are transfer risk but if you said stand

38:01
putting a gun to your head and it's

38:03
loaded I'm crazy enough to shoot it I

38:05
looked in your eyes and I saw those

38:07
crazy eyes

38:08
which one would you say to to focus on

38:13
to make to to give me peace if I

38:16
purchased an annuity contract and it

38:18
would be fear of missing out

38:20
I mean we're Americans right I mean

38:22
we're we grew up in a country where

38:25
you can you can work hard and Achieve

38:28
you're probably one of those people out

38:29
there like me that didn't grow up with

38:31
much money and here we are we've worked

38:33
hard for decades and we've made it what

38:34
a country right sometimes I walk around

38:36
in my house glad that my wife allows me

38:38
to stay in here because it's so

38:40
beautifully decorated I'm like man I

38:42
live here that's phenomenal who would

38:44
have thought that

38:46
the fear of missing out I think Warren

38:48
Buffett said it the best

38:50
um I'm not sure I guess he follows it to

38:53
a point I saw the other day they had

38:55
like 100 billion in cash or some some

38:58
absurd it was such an absurd amount at

39:00
the time this Taping that I was like

39:02
that's a lot of cash that's a lot of

39:03
money market and

39:08
it said

39:09
there's two rules with investing

39:12
I'll never forget when he said this I

39:13
wrote it down and I had it on a poster

39:15
board I used to do these uh these talks

39:18
at these national uh money conventions

39:21
Financial conventions it was this big

39:23
thing in my booth and said rule number

39:24
one

39:26
never lose money rule number two

39:29
never forget rule number one

39:33
when we go into chapter two of Our Lives

39:35
annuities whether you wanted them to be

39:38
in your in your future or not they

39:40
already are with Social Security and if

39:41
you're lucky enough to have a pension

39:43
you already are in the annuity game

39:45
the question is

39:47
do you need more contractual guarantees

39:49
do you need to transfer risk more than

39:53
you're currently doing everyone's

39:54
different there's no carte blanche hey

39:56
you know this if you're this age you

39:58
need to do this no it's it's a

40:00
conversation it's a customized solution

40:03
based upon what you're trying to solve

40:05
for and answering the two questions what

40:06
do you want the money to contractually

40:08
do and when do you want those

40:09
contractual guarantees to start

40:14
the psychology of annuity purchasing I

40:17
know that you probably clicked this one

40:18
this this jackwagon is going to try to

40:21
try to sell me and tell me why to buy

40:22
them and pound the table and come up

40:24
with this one that he thinks is great

40:27
oh no no I think this this

40:31
podcast recording is

40:33
it's needed out there because

40:36
everybody's getting pitched the annuity

40:39
sales Dream by somebody if you're

40:41
breathing and you have a bank account

40:43
that's significant or IRA that's

40:45
significant someone's probably trying to

40:47
sell you some type of annuity

40:50
what I'm saying is slow the game down

40:53
you're buying a contract it's not an

40:56
investment you're going to go through

40:57
some some series of fear of missing out

41:00
and realizing that not all annuities are

41:03
bad and you got to shop all carries for

41:05
the highest contractual guarantee just

41:07
be rational and pragmatic and when you

41:09
call us put your fists down put your

41:12
dukes down we're not you don't have to

41:14
defend yourself it's going to be a

41:16
conversation

41:17
sometimes you get me I tell someone

41:20
because I didn't know I was going to get

41:21
you on the phone and I I don't get on a

41:23
lot of calls anymore because the

41:25
Consultants don't think I should be

41:26
doing other things like this but I like

41:29
to get in the game you know and so there

41:30
I'll take three or four calls when I'm

41:32
available and I like listening to you I

41:35
like hearing you but but I do talk to my

41:38
team on a daily basis and we do have

41:40
good conversations and boy they're

41:42
smarter than me and they talk better

41:44
than me without the accent

41:47
um and they're just you know they're

41:48
they're willing to listen and help and

41:50
tell you if you don't need an annuity so

41:52
the psychology of buying an annuity

41:55
should be in closing

41:57
slow the game down take your time make

42:01
your decision on your terms and top and

42:02
you're on your time frame shop all

42:04
carries for the highest contractual

42:06
guarantee

42:08
that's about it you know and just

42:11
understand you're not buying an

42:12
investment

42:13
with annuities regardless of type you

42:16
are buying a a contractual guarantee

42:19
you're going to get a policy in the mail

42:21
you are going to get a contract that

42:23
contract is between you and the issuing

42:26
life insurance company annuity company

42:28
and with that that's the psychology of

42:31
annuity purchasing by Yours Truly Stan

42:35
the annuity man

42:37
America's annuity agent thank you so

42:40
much for joining me see you next time

42:46
[Music]