Episode Transcript
[00:00:00] Hello and welcome everybody to the Annuity Straight Talk podcast. Quick, straightforward, easy episode for everyone today. Just as a reminder and maybe turn the light bulb on for a few people who have never seen this, My name is Brian Andersen, founder and creator of annuitystraighttalk.com Been at this for almost 23 years.
[00:00:16] Learned a few things, like to share them with you. This is a good exercise.
[00:00:20] So please, like subscribe or comment on any of your favorite podcast platforms or on YouTube. Share it with your friends, your advisors. Let me know what comments you have if I can refine it in any way or, you know, touch some things up.
[00:00:32] A lot of these things require maybe some disclaimers or there's a lot of contingencies. So some of it requires a little bit more explanation. So I haven't talked about fidelity in a while, but we're going to talk about how I beat their annuity quotes every time.
[00:00:49] I'm doing this for a long time. And one of the benefits of doing it the way I have done it with kind of a nationwide approach is I get to see trends and ideas from all, all across the country. Sales claims, sales practices, tactics, all that stuff. I've heard a lot of stuff. I can't say I've heard it all, but I've heard a lot of stuff. But these sales situations become competitive for a lot of reasons. There's ego involved, there's money involved, all that stuff.
[00:01:12] I took a real slow approach to this when I started. Never put pressure on anyone that's paid dividends for me because I've got a large following, a big email list. People know I'm not going to put pressure on them. And the ball rolled. So we do a fair bit of business here. But I'm not ever going to brag about doing the most because I know I don't do the most. I'm not aggressive sales tactics guy. We just do things right. A lot of guys will say just about anything, make the sale. And it's hard for people like you to figure it out. But you really have no excuse because there's more and more information out there. You don't have to believe the inconsistency if something seems ridiculous to the claim. And we talked about it last week with this specific product, there's a lot of resources available, including this one, which I believe is the best.
[00:01:53] Help you figure things out, distinguish between fact and fiction. We're talking fundamentals in planning, nothing crazy. You do it right and the results are impressive. But they're your results. It's not what an annuity does, it's the things that it protects you from. And you guys like, I think it's quite reasonable to take a little time in the process.
[00:02:13] Typically a large sum of money at stake and for every individual. It doesn't matter if you have a hundred thousand or a million. When you're talking about a cornerstone of your retirement plan, that's a lot of money to you. So misinformation in the business. It was kind of the main catalyst for getting me started on this project.
[00:02:30] I remember specifically it was the guaranteed lifetime withdrawal benefits in comparison to fixed annuities and deferring money. For a while it really was like seeing a sales claim and kind of debunking it with conservative numbers and an alternate strategy is what gave me the idea, think what I can do this differently. So it was essentially finding some useful information or a different way to look at an opportunity. And that's worth sharing the news. So hey, if I've got a different perspective on this thing you're considering, might want to look at that. It could give you a better idea or at the very least reinforce your reasons for doing what you're going to do in the first place. So this turned out to be a really good way as the longer I do this, the better idea it seems. And I've said this a lot, if I would have known how long it took me to make this viable at the beginning, I probably wouldn't have started because there were a lot of lean years in getting this and you know, really getting up to speed, making it kind of a cutting edge information website.
[00:03:27] If any of you guys enjoy this, then little pat on the back to me for sticking with it or not having any better ideas. I guess now some of the lies you could be told will do real damage. We've talked about those in the past. Some of them are pretty harmless. It's just a, you know, oh no, that's not true. Well, whatever. So a lot of times guys just trying to throw interference in another chance at the sale and it's okay, but if you run into hardship because of it, that really rubs me the wrong way. So we got a case of the former kind of a little white lie comes from fidelity. And we've had that as a pretty good topic over the past few years. Now there's a series of episodes. It's going back to late 2023. That's when I got the idea. I think early 24 is when I did it. Fidelity changed its tactics and started promoting annuities. For retirement plan, I call some inside information. My buddy Eric in California, he's got a 401k, managed by Fidelity, gets their monthly newsletters.
[00:04:16] He's got some annuities as a piece of his portfolio. They're going to provide some income for him when he retires. Sharp, conservative guy, and he just kind of keeps his eye on everything to see what's going on.
[00:04:26] But when I came out with first thing, it's like, oh, wow, they're starting to mention annuities in their newsletters. And as time went by, they came closer and closer to the top. So Fidelity is going to have 10 or 12 articles they're going to point you to. Well, I want to say annuities made it to maybe number two or three. So now the last email I got was like, hey, they haven't mentioned in a while. But it, you know, made this newsletter. Whatever. It doesn't mean they're not selling annuities because the fact is that Fidelity always sold annuities, but only recently admitted it publicly that it's a good option. And I'm not singling out Fidelity because Schwab did it too. Several people have heard Vanguard doesn't sell annuities. But several people have told me that they confirmed they thought it was a good idea. Their guys at Fidelity or at Vanguard. So when I see a Fidelity recommendation, it is most often a single premium immediate annuity or a deferred income annuity, a SPIA or a dia, the simplest forms of income payments. So if you need a refresher on that and you're new to it, there's a couple of podcast links below in the newsletter that'll send you to the difference between those two when each is right.
[00:05:23] Now, I can usually beat the payouts from Fidelity in many cases by a large margin. I've actually beat it every single time. There were a couple of cases where the difference, you know, my idea might have given them a 3 to 5% cost savings. There was a relationship with the advisor at Fidelity. They decided to stick with their guy they'd been with for a long time. I support that. Relationships are a huge part of this business because it's a big company. They are slightly limited by existing corporate relationships. For what it's worth, they will always represent extremely high quality options. I'm not taking anything away from them.
[00:05:57] So your New York Life, Western and Southern Integrity Life, MassMutual, you know, AAA companies now on the insurance side of things as well. The annuity business is very complicated. A broker who has the flexibility to move around and go find the best deals is always a good option to consider because we can move a little bit more than the guys in Fidelity can. They're stuck with what they've got, which could be good. And again, even if it's a little less payout, if you like the people, you're going to get a quality company. It's a good product, fundamentally makes a lot of sense for retirement. We talked about more money and all that stuff. Then I have no problem with it. We got SPIA versus glwb part one and part two, case studies, all that stuff. Pretty cool. If you need a reminder what that is. So a few weeks ago, I ran into one of these Fidelity things and a guy wanted some deferred income. Fidelity gave him a quote. I took the same premium around the same time period, able to deliver much more income for the same price. When it's typical, the guy was confused. He's like, what? Why can't Fidelity do it? I don't expect everybody to know how the details of this business work, but you're welcome to ask because we'll explain them. We went back to the Fidelity agent, asked him why they weren't able to sell the same thing, and the agent said, there's a little white lie. Well, we don't sell those because they have fees. A company built on a fee model for asset management doesn't sell it. Annuities with a fee, really?
[00:07:16] Ah, laughable, but also untrue. And that is not at all the reason why Fidelity doesn't sell them. Now, any type of fee annuity fee needs to be justified in order for you to pay for it. Whether providing some sort of market protection, guaranteed income, or death benefit, a fee should match the benefit you want. If you don't want the fee, then you don't get the benefit. So the case I'm talking about today, the fee is appropriate because it is added to a product that pays much more income. That's how the company that issues the contract is padding their reserves so that they can meet the guarantee that makes the fee worth paying because it gives the contract owner more money. We like more money, don't we? So anybody can do a quick search, Google, Bing, Yahoo, or otherwise figure out that Fidelity has been selling variable annuities for a long time. Some of those will even have income riders and whatever combination of benefits. In a variable annuity, you will see the highest fees of any financial product. So I think the agent's comment about my recommendation amounts to a sheepish attempt to Open a new conversation. Oh, well, tell me more about this.
[00:08:17] But you cannot convince me that Fidelity is not all about the fee. They don't sell index annuities with a guaranteed income rider because they don't have the right corporate agreements in place. Other brokerage companies do.
[00:08:29] Merrill Lynch, Wells Fargo Advisors, they have them. It's just not as good a sound bite as the previous objection. Oh, but we don't sell something that has fees. And I do expect this to change at some point and it will only benefit consumers more. I imagine they will get into the game. Who knows? Partnership between AST and Fidelity. Come on, boys. Send the private jet. Let's talk about it.
[00:08:49] But needless to say, everything has changed in the past few years. Major investment firms. Fidelity is not the only one. I'm a big supporter of them doing this. It makes things better for the consumer and reduces competition. We don't have to fight about it. We just find the best solution for the clients. That's you guys. So the more consensus we get, the easier it's going to be to shop this market.
[00:09:10] They once criticized annuities and now bring the guaranteed income options to the forefront of portfolio management discussions. The advantage was always there, but now it's too large to ignore.
[00:09:20] Just a reminder for anyone who is told that annuities are not a good deal. Anyone who says that is living in the past and needs to open their mind and do some research. I have converted a lot of investment managers in my career to believing in this system.
[00:09:34] Fidelity may open up the number of options they have, but until then, you can always come here if you want the best deal. Because I've beaten it every single time, sometimes by 20, 30% of the purchase price, which seen the other way, that could mean 20 or 30% more income. So episode 203. Appreciate you guys joining me. Please like subscribe or comment on any of your favorite podcast platforms or on YouTube. I'm here if you want to schedule a call. Top right corner of any page on annuity straight talk.com says schedule call. Click it. Pick a time. Pick a time zone. Your phone number, an email. You'll get an email confirmation.
[00:10:09] I will call you. I believe it says that. Don't be confused. Wait patiently. We will be there. Okay, thanks so much for joining me guys. I look forward to next week. Episode 204 got a couple of good ideas. I think we might step outside the box and do something a little bit more technical that could apply to a lot of retirees and also something maybe you want to share. With your kids or anybody younger who is starting the building blocks of building a retirement portfolio. Thanks again for being here, guys. I will see you next week. Have a great day. Okay, bye.
