Episode Transcript
[00:00:00] Speaker A: Hello and welcome, everybody, to the Annuity Straight Talk podcast. Episode number 237. My name is Brian Anderson.
[00:00:06] Speaker B: And I'm Nate Lee. Again in Montana.
[00:00:10] Speaker A: Enjoyed some fall time here, and it's been a lot of barbecuing and some raw weather, but we're doing okay and we're getting a lot of work done. Right.
[00:00:17] Speaker B: I do have to give Brian some props. He can make a pretty solid steak and burger on the grill.
[00:00:26] Speaker A: Invite only if you want that. Okay. And we got the grizzly bear in the background. If anybody wants to give me an idea for the name of the bear, my stepdaughter gets to name the deer and the elk in the background. I didn't like her names for the bear. I'm not sure if she's gonna see this. We'll talk about it, but I gotta run it by her. But if you got a name for the bear. I always wanted a big teddy bear, and we got it in the background
[00:00:48] Speaker B: now, so it's pretty sweet.
[00:00:50] Speaker A: Okay, so episode number two, 237. We're gonna talk about a product that really makes life easy for us and should make life easy for you.
It's a great story to tell. Nate was you were a wholesaler for Midland National. He was actually my rep for a couple of years. Decided to step out of it and take a more relaxed lifestyle.
Picking up my pieces, I suppose. Right.
[00:01:13] Speaker B: Trying to help where I can, but.
[00:01:16] Speaker A: But okay, so we're talking about the Midland National Income Planning annuity on episode 237.
Like, subscribe or comment on any of your favorite podcast platforms or on YouTube. Schedule a call with us. Top right corner of any page on annuitiestraighttalk.com right now, Nate, we are seeing the biggest rates that we've ever seen on income payouts, for sure.
[00:01:39] Speaker B: They just increased these rates, what, in the last week and a half?
[00:01:43] Speaker A: Twice in the last month?
[00:01:44] Speaker B: Twice in the last month. And some of you may have remembered podcasts that we did a while back on their Income Vantage Pro product, which I own.
But this product, as soon as I turn age 50, I will be investing more of my own money into. That's how much I believe in it.
[00:02:00] Speaker A: Everybody asked me, when are you going to start buying annuities?
And my plan for that has changed since rates came up in the last few years. But I always said 50.
The reason for this right now is because I'm going to buy this product when I'm 50 years old, and I'll be 48 in a couple of months.
But I've got a couple of years left to sock away some cash. And the reason is like, just simple. It's that the roll up doesn't start for anybody young, younger than the age 50. So I'm technically excluded right now. But it's a cool product. Let's talk about it.
[00:02:37] Speaker B: Yeah. So this product, it's been around for a while, but as we mentioned, the payouts on it are as good as we've seen. But one of the things that Midland did that I really like is to keep it very simple.
Every year you defer based on your premium, they will grow the payout. It's not a walk away value, but payout. So income in retirement by 10, I think most of us would say, heck, I'd take 10% guaranteed every single year if I had it.
[00:03:04] Speaker A: It's like Social Security, right?
[00:03:06] Speaker B: Like Social Security. The longer you wait, the more you get.
[00:03:09] Speaker A: And so it's really nice. And what I like about this product is it just grows the payout rate. So it's, it's based off the initial premium.
It's very comparable to other products and will exceed that right now in a lot of different cases.
So a lot of people don't understand how it works. And I just say it's like Social Security. If you wait, you get more. Okay. And this one is calculated more in the contract by 10% increase every year. You wait to wait to take income.
[00:03:40] Speaker B: Yeah. And I always want to mention it works great for qualified money. And that's what I will do with my own qualified assets. Because you're going to have to take withdrawals at some point, right. You got RMDs at some point in the future. But this is a way that you can guarantee, right, A portion of that income. Create your own pension, which a lot of us don't have. Right. Unless you're a county, state or federal employee, you may not have that, but most people love that. Right? It's the predictability of getting a deposit in your account monthly, quarterly, annually, however you want to set it up, you know, you've got it as long as you live.
[00:04:13] Speaker A: So the coolest thing about this is all these products that have the guaranteed lifetime withdrawal benefit have a step up. Every year that you wait, it increases by a certain percentage and a payout rate. And most contracts or every other contract requires you to wait a full year. It's a contract anniversary.
So this one increases on your birthday.
Now I had a client buy this two years ago and because we had problems with the transfer, we were fortunate, grateful to get this issued one day before her birthday. So the very next day she got her first 10% step up, which would have required her to wait an entire other year with any other contract.
[00:05:00] Speaker B: Yeah. And you know, a lot of times, and we love the tools that are available to all of you on the website with our different calculators, but they don't always tell the whole story. You can only show so much. And so a lot of times that's where we'll get on a call with you and say, okay, if it's a joint payout, who's the youngest of the two and when's their birthday? Because we know that there's a good chance that this product, this income planning annuity, is going to pay more than even what it shows on the calculator.
[00:05:29] Speaker A: Right. So if you, if you show on, if you go to the GLWB calculator and you do a two year deferral and Midland National Income Planning Annuity is going to come up, realize that's not two years, that's your second birthday from when you buy it.
So for some people that could be a year and two months, year and three months. And that offers a strategic advantage for a lot of people when, and then there's sometimes when it's like, well, North American's paying higher or nationwide's paying higher and you just had your birthday, it doesn't matter. But still you got to look at it because that could be the deciding factor for sure.
[00:06:03] Speaker B: And a couple things too that are relevant. We always try to be as transparent as we can. This thing does have a fee 1.25%, but it's important to note that it's based on the premium you deposit, not on the account value.
[00:06:17] Speaker A: Yep. And so in the other ones they have a, a separate income value that's got a bonus and a roll up on it. And that account, that number grows a lot and the fee is based off that, but comes out of your account. So this one stays level and fixed for the term of the annuity.
[00:06:36] Speaker B: Exactly. And if you are going to defer, we recommend not going beyond 10 years because of the product design.
But your account value has good growth potential. I think you've seen a couple of those recently where they've done really, really well. But you know this, the intent is still for income later in retirement.
[00:06:53] Speaker A: And that's another part of it. It's like I was looking, I had a client call me the other day talking about this. When Nate was here, was my wholesaler when I sold the contract. And now, you know, we talked to him when we were driving into town, great guy, and realized that he's had it for two years now and the account's grown by 5% every year.
So a lot of people say, hey, what's the difference? You know, so he's got 10% more money than he put into it. So if for whatever reason, plans change, the money is still growing, it's available, and when he starts taking income, that growth factor is important because if you don't live long enough to collect all the payments, you want to make sure your heirs are getting the money that you put into it.
[00:07:35] Speaker B: So, and that also brings up another point. Some of you may have heard of a doubler or a multiplier on a contract. All that means is usually it's got to be enforced for a couple of years. So you can't be, you know, needing some assistance. Usually it's two of six ADL's, activities of daily living.
But what it allows you to do is double your payments for up to five years after that two year period if you meet the 206 ADL's. And I always like to mention that doesn't mean confinement to a nursing home or a long term care facility.
Doctor signs off on it, you can double your payments for five years as long as there's cash value. So that's why the cash value is important.
[00:08:14] Speaker A: That's why you want growth. And a lot of people say why is cash value important? I say, well, it's important for the long term care doubler and it's important for any inheritance you want to leave behind if for some reason you don't collect all, all the money out of it. So yeah, so you want to have a good growth factor. And I like that, I like that. I've got clients that own this contract and they've actually seen really good growth in their contracts for the past few years.
[00:08:41] Speaker B: So and, and that actually brings up one other thing for me. So like my example, I'll be 50 next year, I'm going to defer for 10 years, right? Qualified money, can't take it till I'm 59 and a half. But if something were to happen to me, you've got that account value that gets paid out as a death benefit. But the other cool feature is you can do a single or a joint payout and you don't have to elect it until time of income, right? So gives you some flexibility.
[00:09:06] Speaker A: And we, we had a recent client who got it issued before his birthday. He's not married to his partner. Yet if they decide to get married later, they can elect joint. Big, big difference between these contracts and the spias, the single premium, immediate annuities, the deferred income annuities is that you don't have to decide when you take the income when you buy it. You buy it with a contractual set of payments and increases over time. And you can, you don't take income until you elect it. So if you buy it thinking you'll wait three years, if you decide to wait five years, it's going to go 10% each year after that. And you don't take it until you want it to lock in.
[00:09:47] Speaker B: So give us a call, we can run you a calculator quote. And it's a simple one page sheet and it literally will show you the dollar amount you would receive if you took it immediately if you waited 10 years. You know, it's pretty straightforward and that's what people like about it. It is so simple and you know what you're going to have.
[00:10:05] Speaker A: So why don't you like you did the numbers on like if you put half a million bucks in when you're 50, like what, what's the payout?
[00:10:11] Speaker B: Yeah. So I think this is pretty amazing, which is why I'm excited about it. But put in a half a million bucks at age 50, 10 years later you can get $85,400 a year for the rest of my life. I ran some numbers and I can kind of throw them out at you guys. But you can do them yourself, right? You just take that 10 year deferral. So I'm 10 years into it. But then if I took income for 10 years, well that's simple. It's $854,000. Right.
I started with 500k.
[00:10:40] Speaker A: Yeah.
[00:10:40] Speaker B: I've already gotten all my money I put in out of it.
And the longer you live, you know, the more you get ahead of the insurance company. So if I took 20 years of income, right now I'm age 80, I've gotten 1.7 million in change out of this. And then if I lived to age 90, so 30 years of income, I would have gotten $2.562 million guaranteed. Right, guaranteed.
[00:11:06] Speaker A: And let them handle it. It's like that's a, you know, people realize it's a risk transfer. Like let them handle it. Like, well.
[00:11:13] Speaker B: And yeah, and also along those same lines, these are life insurance products. They're coming from an insurance company. So the actuaries are building these and they're, they're looking at life Expectancy tables. But I always use this when I was wholesaling. If you have a 65 year old couple, 50% chance one of you is going to live to be 93, people are living longer, they're healthier, technology, right, all these things.
So again, you can look at those and go, yeah, I mean, you know, you're going to get your money out. And if you have longevity, you know, in your family history, you live in your 90s or even 100, it's a heck of a good deal.
[00:11:50] Speaker A: So that's, that's who it really appeals to. If you talk about mathematically like, oh, I have longevity in my family, this is going to pay off. I'm sure it's going to work out great. The other ones, like strategically, you're just saying this is a damn good deal. And when it's most valuable is when you're in your, you know, mid to late 70s, early 80s and it's like you don't want to be managing or stressing about finances.
You just want to know you got a guaranteed paycheck coming in.
[00:12:19] Speaker B: Exactly. And it is that predictability that know what you've got. It's going to come every single month. If that's how you set it up. And yeah, can't hurt you incredible product.
[00:12:29] Speaker A: And if it works for you, we'd be happy to tell you all about it. So you guys want to talk about this or anything else or run your numbers? You can go straight to the GLWB calculator on the website. It's going to give you accurate numbers.
Or if you want to schedule a call, top right corner of any page on annuitystraight. Talk.com talk to me or Nate. If you want to talk to any one of us specifically, just put it in the notes and tell us what you want to talk about.
Share this with your friends. Let everybody know this is an incredible deal. Nobody else is putting it out there like this. It's just a really unique value proposition for a certain group of people and anybody who wants a good deal. Right.
[00:13:08] Speaker B: And just, you know, to circle back on what you said to begin, these products can and do change. These are the best payouts we've seen and our careers when it comes to products like these. But you know, could it go up? Yeah, I don't see it going up a lot more. But take advantage. If you're one of those people that is, you know, near retirement, already in retirement and just wanting to, to guarantee some of your income, you know, we can run you through the strategy calculator and show you why it makes sense for your portfolio.
[00:13:36] Speaker A: Yeah, we've got a lot of tools, and we're not going to just do a quick sale. Hey, buy this. We're going to want to know why and make sure you do it for the right reasons, so.
Okay. Thank you guys for being here. Nate, great to have you in Montana.
[00:13:49] Speaker B: Always good to be here. I'm sure.
[00:13:51] Speaker A: I'm sure you'll be back.
[00:13:52] Speaker B: Yeah, absolutely.
[00:13:54] Speaker A: Okay, well, you guys have a great, great week. And get a hold of us on the top right corner of the page if you want to. Otherwise, we'll see you next week for episode number 238. Okay, have a great day. Bye.
