Episode Transcript
Speaker 1 00:00:05 This is annuity Straight Talk. Since 2008, your host Brian Anderson, has helped clients nationwide navigate the complex market for annuities With Brian's assistance, hundreds of clients have achieved a profitable and secure retirement. I would know because Brian has answered many of my questions concerning annuities and retirement planning so that you can benefit as well. Let's get started. Here's Brian.
Speaker 2 00:00:48 Hello and welcome everyone to the Annuity Straight Talk podcast, episode number 58. My name is Brian Anderson. I'm gonna think of a title for this one later. It's more or less just an update cuz I've been out for a couple of weeks. I skipped last week, as you guys know. Just got back from the elk hunt. So, uh, last one, Elk hunting and annuities. Figured I'd tell a little bit of the story and just kind of do an update on what has been happening in the markets since I left. Let you guys all know that while I did not pay attention to it, I am caught up to speed and ready to go help everybody figure out solutions to problems and finding good places for money. Protection is key when facing retirement and I'm here to keep it all in context for you and make that transition as simple as possible.
Speaker 2 00:01:32 As I talked about in the podcast, elk hunting and annuities, it's a time for me to disconnect and while I try to kind of keep an idea of what's going on, Little bit about my schedule when I was doing that, everyone's a bit different. This one, we were kind of truck and camper based, so usually wake up at four 30 in the morning, coffee, quick breakfast sunrise is six 30, quarter to seven. So we try to be hiking about 20, 30 minutes before sunrise and be in a good position to, uh, see what's going on when the, when it becomes daylight. Elk hunting in the fall in September is really good because you can hear them elk or bugling. I talked to one couple who was going from Texas to I think maybe Colorado, just to watch the elk route. So you can go to some of the national parks and all that stuff and you can get a really good idea.
Speaker 2 00:02:25 The action is just really, really exciting. Anyway, so it'd be up early, hiking around and then it warms up during the middle of the day. A couple of days were pretty hot. Once, once it warms down, the elk will bed down, usually get kind of quiet for a while. And so by 11 o'clock or noon back to the camper, relax, I had a cell booster so I'd hook that up and get to check my voicemails and stuff and you know, you have until 3 34 in the afternoon. It's dark by eight or so at night and uh, those elk start getting active again and it's a good time to watch 'em and see 'em. And so to be honest with you, 95% of the time you're just hiking around looking for 'em, watching 'em kind of get an idea of how to hunt him, how to get close to him.
Speaker 2 00:03:06 And it was just an unbelievable experience. So, but that three or four hours during the middle of the day is when I kind of got to maybe do a couple of emails. Like I told everybody I wasn't going to, the plan wasn't to be completely available, but you know, I, I looked at the Bloomberg Open, the Bloomberg closed, looked at interest rates and I got 'em up on the bigger screen. Let's see. So the big headline on Bloomberg this morning. So this is Monday, September 26th and I like watching, you know, Bloomberg during the day. I get some, I I'm more or less just read headlines if something's really striking to me. But what I think is very, very important, <laugh> very interesting, the big headline says Traders who just want to survive are sitting on 5 trillion cash pile. So don't feel bad if you haven't or have a hard time making a decision.
Speaker 2 00:03:56 Have a hard time placing assets if there's 5 trillion in cash sitting on the sidelines from the market. We're talking about traders, not just everyday investors, people that kind of make their living doing it, institutional and private as well. They're sitting on cash because everything's kind of up in the air right now. A lot of uncertainty. And I think a few weeks ago, John Balmer night we did a podcast, the stock market head fake. You wanna check that out? John? Read some charts and kind of explained trends in the market, things that you wanna look at. We've been kind of calling for some volatility. Few people question that, but we wanted to remind everyone that that's, those things don't happen. You know, the stock market never just drops in just a day. We've got some really, uh, negative indicators coming, arising, interest rates, inflation. The feds saying they want to, well they don't, they say they want to, they said they, you know, might have to crash the economy just to keep inflation in check.
Speaker 2 00:04:49 So it's kind of a rough time to be in the market. Not a lot of positive things. You're gonna come out of that unless you're uh, super hot stock picker and you're able to pick the few that do rise and tumultuous times like this. But because rates are up and you know, if they, they crash the economy then or if the economy crashes, typically interest rates will drop and they've got some ammunition to kind of get it going. Kickstart could be a while, but this is why it's been a great time of the year for annuities cuz rates are are high. One thing, you know, a, a new client of mine recognizes he didn't mind locking into for some longer terms. He did a nice ladder from three to seven years and maybe we'll go a little bit longer, maybe on a couple. But you know, he thought, well in three years do we know rates are gonna be as high as they are now?
Speaker 2 00:05:34 I do believe they're actually gonna come back at some point. I don't know when, but you know, he nailed and he said there's reinvestment risk. So yeah, for a 10 year annuity you got a 4% base rate and it's the same as a five year annuity. But in five years do you think you'll be able to get better rates than 4% or are you better off just keeping that solid rate? And again, talking about, you know, index annuities and fixed annuities. Fixed annuities, a guaranteed rate, that's the building block for the index annuity gives you the upside and the leverage with the indexes, with the participation rates, the cap rates. And so not a bad time to be locking into safe assets, right As things kind of seem like they could fall off the clip. Now it's not gonna happen today or tomorrow. I'm looking at the Bloomberg close, the s and p was down just shy of 1% for the day.
Speaker 2 00:06:20 This is Monday the 26th. It was pretty rough on Friday. Expect probably some ups and downs. It doesn't go straight to the bottom. It's gonna bounce around on the way there. There's gonna be points in time where you get kind of tiny little rallies and stuff like that. But as we've talked about, you know, the trends that going a little bit lower, It is for informational purposes only. It is not at all to convince you to make a move now, but just talking about whether if it's time that you think you need wanna do something or need to do something, this isn't a bad time to do it. So again, keep it all in perspective and realize we're talking about long term solutions and long term planning. But as of uh, the close of business today, the uh, 10 year treasury is 3.9%. That is the highest I've seen in a while.
Speaker 2 00:07:06 It seemed to kind of steadily climb over the last few weeks. And again, it's interesting when you, and you take kind of two days when I'm sitting here, I do this four or five times a day, I look at kinda what the market's doing and what interest rates are doing, being in fixed income and annuities interest rates are the biggest driver in that. So I'm always curious where trends go. But you know, when you kind of take two weeks off of doing every day, it's kind of a surprise. It comes. It's like coming back into a brand new world and one thing I like to look at as well is right behind me on the big screen that you might be able to see in, uh, I don't think you can see it really all that well, but that's kitco.com, precious metals. So gold is trading at about $1,620.
Speaker 2 00:07:47 It's down about a hundred bucks an ounce in the past year and silver's at $18 and 38 cents. I think that's a great buy on silver gold could go a little bit lower. Interesting to see what commodities are and it's kind of the safe haven asset. I think those things will take a little bit of a backseat when you've got healthy interest rates in fixed income. The two year treasuries at four and a quarter. So really good short term money. People are talking about having CDs at 4% for one year, two years. And again, let's think about the reinvestment risk of that. I don't know whether it's a, you know, a good thing going forward and if you locked in something a few months ago, four or five months ago, I'm gonna tell you a lot of people got short term fixed annuities have been really popular this year.
Speaker 2 00:08:30 I have no problem with that. I support the idea. Uh, you know, kind of talk about the value of all things depending how long your plans are. But some people, you know, let's say you got four or five months ago you got something at 4% and if you waited until now, you might be able to get that same thing at four and a half percent. So if you're talking about a five year deal and a hundred thousand dollars a half percent is 500 bucks a year, it's uh, 2,500 bucks plus a little bit of compounding. So call it twenty seven, twenty $800 over a five year period. But if you got 4% four or five months ago, six months ago, that's a couple thousand bucks in interest right there. Plus the compounding over time. So there's a cost to wait and if you're waiting for things to get better, you have to think about the time you have to wait until it gets there.
Speaker 2 00:09:13 I firm believe we might see some stuff. We've got a couple fixed annuities that are approaching 5% now, but longer time periods. And again, if you're waiting, a lot of people tell me they're going to wait and so I want to uh, you know, just remind you that there's a cost in doing so. Now the nice side of that is I hear a lot of people talking about money markets that are paying one and a half. It's not exciting but dang it's a whole lot better than it has been. A lot of people weren't getting, you know, a 10th or a quarter of a percent for the past several years. So really good time to be in annuities and honestly, uh, a lot of people wanna buy into the index annuities at the bottom of the market, but then, you know, you're dealing with lower rates oftentimes.
Speaker 2 00:09:54 Yeah, it's just a great idea to get something locked in. And so these are the kinda all the things that I've spent the last few days and got, I think I got back last Thursday night, uh, touch base with a few people. Sent everybody a note on Saturday just saying, Hey, I'm back and going to get this stuff going. But um, I'm having a lot of fun doing it and again, I want to thank everybody for the patience as I went off and uh, recharged my batteries, kind of got mentally back into the game. I think I said it in the note, I hiked probably close to or over a hundred miles while I was gone. A lot of physical exercise getting up early. Good afternoon naps. Um, you got it is like the focus is on healthy eating and boy it was just unbelievable.
Speaker 2 00:10:36 It was the best hunt of my life and probably what I've said to a lot of people is like top five outdoor experiences I've ever had. Private land, we met some really, really, really great people. Um, and just had, you know, a lot of peace and quiet. One thing that's really cool when you get way out there that my friend that goes, that goes, that went with me, he really likes the fact that there's no light pollution. So you don't have the lights of a city that kind of glow into the sky. It's just dark. And so you see the Milky way and the moon is really bright and the stars bright moon at night's not great for elk hunting cuz a lot of times they can see really well they stay up all night long and they're not as active during the day but it's just something you gotta deal with cuz we live in a world that's got a moon that floats above us and lights us up in the night.
Speaker 2 00:11:18 Anyway, it was just uh, um, a lot of fun to do it and a lot of just good experiences and again, just really relaxing in a cool, beautiful place and to have all that ground to ourselves was just a blessing and, and I absolutely loved it. So we're back. This is kind of a quick episode just to say hello to everyone. Say thank you. I'm getting the, the antlers for my elk cleaned up. I was fortunate enough to uh, get a really nice one. My buddy shot an absolute monster but uh, I don't take it for granted and uh, I'm gonna get it cleaned up. I'll probably have it in the background another few days. I'll probably uh, get ahold of it and next episode I'll show everybody what they look like in case you were wondering. And you know, I'm curious to talk to the couple from Texas again to see uh, what they thought of their trip to see.
Speaker 2 00:12:04 I don't know, it was the first phone call a couple weeks ago sometimes. So I'm not quite sure anybody that has had uh, conversations with me in the past. If you wanna revisit those, you can get a hold of me. Again, this is a quick episode 58 just to get back into the swing of things and let you know I've kept an eye on markets. Things are still in really good position for annuities. It's a great time as far as the gold, the silver, you know, actually commodity base, there's some indexes you can follow that give you prices on that. I expect to see a bounce in the gold price and silver in the next year or so. There are indexes you do that have elements of that or have indexes for that will track those prices so you're not just stuck to the s and p 500.
Speaker 2 00:12:42 Uh, remember index annuities have fixed rates, they've got commodities based indexes, equity based indexes and even we got real, you know, real estate and they do some bond stuff too, which I don't really see the point of following bonds. I mean the annuity is a bond. We've talked about that. So a lot of interesting, you know, comments you can have about where bonds have fit. A few people have told me, man, the bonds, I lost money on those too. Rates go up, the bonds drop in value. It's kind of a double whammy. I've talked for years about how index annuities are bonds, plus the insurance company owns the bonds. You get the rapper, the annuities, you get to own the bonds without the interest rate risk and by adding the reserves of the insurance company for safety. So taking a free withdrawal from annuities does not have the interest rate risk associated with bonds.
Speaker 2 00:13:25 All of those things, just different lessons over time. Here we are, I'm just, again, I'm trying to help people make good decisions and if you use annuities first and foremost, you want to know that that's the right option, then you gotta decide where to fund it and how it fits with everything you need to do. So income planning required minimum distributions, long term care, kind of goes back to my five keys of retirement. May do a review of that if I can fit it into the context of some sort of plan. So anyway, looking forward to it. I've got probably four weeks before I go do anything major. And then again, majors, you know, just a three or four day, a long weekend trip. But I'll be around and try to get a lot of, uh, work done. We've got some, uh, pending contracts. We wanna get those sewed up.
Speaker 2 00:14:08 And I'm here for anyone if you need something. Again, episode number 58, you can go ahead and subscribe to the YouTube channel if you wanna see the video or you can subscribe to any of your favorite podcast apps on your phone. Google Podcasts posted on Casto, Apple, Spotify, ah, there's a bunch of them. So whatever you like to do to however you like to get the information. So here's a little bit of an update on what's happened in the past two weeks. I'm back. I've enjoyed it and I'm looking forward to helping you guys. If you need something, gimme a call, 804 3 8 5 1 2 1 or schedule a call, uh, top right corner of any page on annuity straight talk.com. Again, episode 58, my name is Brian Anderson. Thank you guys so much and I will talk to you next week. Okay, bye.
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