Episode Transcript
[00:00:00] Hello and welcome everybody to the Annuity Straight Talk podcast, episode number 199.
[00:00:08] My name is Brian Anderson, founder and creator of AnnuityStraightTalk.com Drilling Home. The point today of all that I've done for the past almost 23 years of my life in my career.
[00:00:22] We're going to talk about it. Making more money with annuities. Please, like subscribe or comment on any of your favorite podcast platforms or on YouTube. Share it with a friend friend. Or share it with someone else that you think might disagree or have a bone to pick. That's going to make me stronger. Love. Good debate. Bring it on. Be happy to do it. What I've noticed is it comes up in conversations and I always tell everybody that I've got to do this. I got to say certain things over and over again because I don't expect somebody who just finds this to remember what I said and say episode number 27. I don't know what I said then. Unless you bring it up, I'll probably remember it. But anyhow, from time to time we go through and I've always said that everybody's got to have their own perspective on on things or see it from their own perspective to really understand it. And last week we had a light bulb moment. So this episode really fell in my lap because light bulb moment with one person who has seen every episode, a lot of them multiple times. He may or may not be closely involved with the production of this. I'm not going to name names and I just thought, hey, here's the deal. So I'm going to share my screen. This is my visual aid. It was a little bit longer writing, but I want to make sure I stay on topic. So you want to make an appointment with me? Here you go. Look at this schedule. Call top right corner of any page on annuitystraighttalk.com There you go. So make more money with annuities. I'm going to say make more money. The ideas that you get better financially with using an annuity. And I want to drill this point home because sometimes the theme seems like I'm not explaining things clearly enough. Annuities help you do all sorts of things in retirement to produce simplicity, security and profitability.
[00:02:03] So if you do it right, you will have more money no matter what you use an annuity to do. If you're using it to provide more stability in a portfolio over time, if you're using it to produce the income you need in retirement, whatever it is. But you have to look at it in Terms of what's most important to you. When I say that portfolio values increase with the right annuity strategy, that means you will have more money if you use an annuity than if you did not use an annuity. When I show you leave the largest legacy with an annuity as part of the plan, it means that you leave more money to the next generation than if you hadn't used an annuity. Now, if legacy is not what you want, then use the money for whatever is important to you. I'm going on 23 years. I've sold some substantially large contracts to some very successful people.
[00:02:50] They didn't do it because they were losing money. They didn't do it because they were unsuccessful. They did it because they understood that they would become wealthier and life would be easier with the annuity. There's no debate about where your money's going to grow the most. We all know that the stock market is going to provide the best growth over time. Things are going to change dramatically when you start distributing money from your portfolio.
[00:03:13] Dollar cost averaging, everybody who's a fan of it saving money, buy some shares high, some shares low. Averages out, gives you a better yield over time. Right? And the exact opposite is true when you get to the spending years, considering what's at stake when you're no longer working and saving and bring in money, reverse dollar cost averaging is even worse.
[00:03:34] Everybody's got to hear from different perspective. I don't blame anyone for doing it. That's just the way it is. Like some people don't connect the dots. Like very hyper focused because it's an important topic. You got to talk about what's your biggest retirement concern. Let me know what that is and I'll tell you how this fits into that. Some people get it pretty quickly.
[00:03:53] Others could take seven, eight years for the light bulb to come on. Not naming names.
[00:03:59] I'm going to go through this again because we've got so many episodes out there and a lot of the new people have not seen any of these. I don't mean to patronize anybody, but go back to look at the past episodes to say, hey, I'm talking about the same thing based on your biggest concern. Okay, we're going to take these and I want to make it absolutely clear these are like miniature case studies. Okay? So a few years ago I met a couple that a big enough portfolio to support a high spending goal in retirement.
[00:04:26] Now pretty substantial savings, but also a big spending goal. Now the husband's the guy who follows this might still be out There we didn't do business, but he was all about, hey, let's get this guaranteed. This is great. Yeah, the annuity looks good, but the wife didn't want to spend the money.
[00:04:42] So, yeah, we do want that income, but I want to leave as much as I can to my kids. We ran multiple scenarios and without the annuity, they're running a significant risk with a high spending goal of running out of money altogether, like just being broke and not having the income or the legacy. With an annuity in every scenario, there was a substantial portfolio remainder at the end of it, plus the guaranteed income. So they never have sacrificed lifestyle to do that. They had more money with the annuity in those scenarios, no matter how we ran it. So that's when I recorded the episode. Annuities create a legacy that means more money.
[00:05:20] So they could create a legacy by using an annuity if they secure what they had. Now, earlier this year, I had a client who I worked with for a few years. I consider him a very good friend, damn close to family. Honestly. He bought a myga three years ago. It was coming out of surrender and the idea was that three years ago was right before rates kicked in and, well, some income somewhere, whatever, let's pitch this into a 3 year Myga. Wanted to protect it. Hey, just take this out of the equation and we'll deal with it down the road. Guaranteed income was kind of the goal. I think he did it at the time was instead of buying a deferred variable annuity that didn't have much of a guarantee, it might have done okay, but this guy did really well. He's got an investment advisor that manages the rest of his portfolio. The guy strongly suggested, hey, that money's coming due.
[00:06:05] Bring it over here. You've done really well. Let's do all this stuff he's got. RMDs are going to come up in five, six years. A steady stream of cash flow benefits him in a lot of different ways when you're consistently pulling money from the portfolio. I'm going to do a separate podcast on required minimum distributions. Probably 201. We'll see now. So I ran him through the scenarios and said with an income annuity, we can safely predict a much larger portfolio balance.
[00:06:29] And so that investment guy who's chomping at the bit to get the money under management now will end up managing a lot more later if he's just patient. If he does and realizes what's best for the client today, then he'll get the benefit of that down the Road like we all do. I set aside what I want.
[00:06:47] Three years ago, I could have made a lot more money off that guy if I sold him some product like that. But it worked out better for me. Worked out better for him. He got way higher rates. I made money twice. Okay, fine. But the investment advisor has just got to be patient and do what's best for that guy. If your investment advisor objects to you using an annuity, then show him that episode. I did that earlier this year. Annuities create bigger portfolios. Correct me if I'm wrong, but that sounds like there's more money there. I don't know. I don't need to argue with investment managers because I know how it works. One by one, they are starting to see the light. I don't know what that advisor did, but I've known a lot of people that end up like, oh, yeah, that makes a lot of sense. I'm going to get an insurance license. Maybe I'll start selling these too. Right. An investment advisor who charges a fee for it can still sell annuities and get a commission. And you can't charge a fee on something you took a commission on. They just can't make that connection. I've talked to a lot of people that don't get that. Well, we can't sell that. Yeah, you can. You just can't charge a management fee. They're so hung up on their fees, they want to charge the fee. We haven't talked about inflation in a while. And no matter what anybody says, there's not a whole lot you can do about it. The best way to fight it is to have more money.
[00:07:54] So that sounds easy enough. More money is more money. So more money is good for inflation. Then using an annuity to provide income and take pressure off your portfolio actually helps your assets grow more, which means you have what you need to handle spending increases. Now, it's not talking about inflation adjusted annuities. They aren't worth the extra money because those are still fixed on today's rates. You just pay more to get them. I'm talking about efficient distribution of assets. Creates a bigger portfolio. Last year I did an episode.
[00:08:25] Annuities helping with inflation. And you know what the point of that was? Hey, you have more money. So pretty simple for anybody who doesn't quite get it yet. In one of the very early episodes from more than three years ago, this was a good one. I talked about a couple who had a seven figure portfolio with Fisher Investments. They were right at the RMD age and they were Uneasy about the market. Now why it's considered appropriate to have a couple like that 100% invested in equities, it's beyond me. But that's what they had in any other part of the business. I talked about CDs last week. The banks will do it to you, no problem, but insurance company won't let me do it. But you have everybody at risk, any whatever. So systematic distributions RMDs were right around the corner for those guys. A stable asset would then be critical in the long run to maintain or even grow the portfolio. So I ran the numbers on that and that's where I said why not an annuity? Where I found the perfect balance. Based on the scenarios we ran, 25% of their money in the annuity would improve the total remainder.
[00:09:27] In the worst case scenario, improve the remainder by a large margin so they had more money. Now if we ran a really good market scenario, with or without an annuity, ended up about the same. So that's why I recorded the episode why not an Annuity? Go to the newsletter. These are all linked. You're going to see them. Why not an annuity?
[00:09:45] It's going to be safer, it's going to be easier.
[00:09:48] You could do just as well or better. I don't know why not? Then going back to well before I started the podcast, but I did record this as a podcast. One of my very favorite episodes is how to Beat the Market with an Annuity. Now this was a light bulb moment for me when I figured it out several years ago. And then I after doing it, I thought, wow, I'm a genius. And I realized that Wade Pfau had academically proven it long before, but again, he said it in a different way, but it means the same thing. So the reality is that you guys have more at stake than ever before with larger portfolios from a wild stock market and fewer working years to make it up if things go wrong. The more you put into an annuity, the bigger portfolio you'll have when it's all over.
[00:10:33] It's the most efficient way to retire. The strategy of like putting all your money into annuities is like, I'm not saying you should do that, but it's really fun exercise to do. And look at it because annuitizing every piece of asset you have and investing the extra money into the stock market is the most efficient way to enhance wealth and provide for retirement income. You'll have the biggest portfolio. It's pretty wild and a lot of people look at it like, wow, that can't be true. It's true. I hope that everybody in the back is still awake. Yes, we are talking about making more money. Bigger portfolio can create a legacy, can help you hedge inflation. I am not doing this because it's easy. I do it because it's worthwhile. And I got excited about it when I started learning these things as well. I don't sell bad deals to people. I don't screw people over. I'm not just trying to get your money. I had this conversation today with someone who said, hey, what's the best way to do it? Difference between products and all that stuff, Being honest about it. Let's just talk about it and analyze it. So not a big deal.
[00:11:34] My clients understand it now are only going to become happier as time passes. As the years go by, you find enough value in something to put a substantial amount of money on it. Now, every day, every month, every check that comes in, every year that passes will prove the value of that more and more. That's why it goes back to do annuity owners live longer? Probably talking about income, I'm talking about security, mygas, safe money, growing index, annuities, whatever it is, find out what works for you. So if you want easy, guaranteed and max profitability, get on my calendar. I'll take care of you. So thank you for joining me for episode 199. I am the founder and creator of this.
[00:12:13] I had all these wild ideas and if you want to make an appointment with me, top right corner of any page on annuitystraighttalk.com send it to your friends. Anybody you think can benefit from it. I got a good episode for number 200. A client of mine came with a good idea. They got the gift card. I'm happy to say that. And I'm going to spend some time working on that. But thank you guys so much for joining me. You all have a great day and I'll see you next week week for the second century episode. All right, have a great day. Bye.
