- 30,270
Purchase Payment.........Initial: Subsequent:
• Qualified: $4,000 $1,000
• Nonqualified: $10,000: $50 (with Automatic Investment Plan)
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flexible premium deferred annuity
- Thread starter myinsurebiz
- Start date
• Qualified: $4,000 $1,000
• Nonqualified: $10,000: $50 (with Automatic Investment Plan)
- Thread starter
- #22
- 5,995
yea - read that later
- 11,457
Take your annuity suitability courses and let us know later.
This is why I recommended that you go to Primerica and learn how to sell with mentorship and joint work. You don't know what you don't know.
Thank you.
So here's how this works.
People with little money constantly have to raid their savings for stuff.
New furnace, roof, transmission, etc. can create a real financial crisis for a lot of people.
ANYTHING with a surrender is asking for them to "forget" that their agent told them about the surrender period and then they raise holy hell.
If you want to go down this road and cross sell more profitable products, teach your agents how to help their clients budget. Emergency savings, credit card payoffs, Dave Ramsey stuff (without the perm life hate).
That is a value add with no real liability and still helps solidify the relationship.
There are probably boilerplate courses where you can provide this education. It would differentiate your agents without the headache of managing a small amount of assets.
- 4,886
It cant. 1035 exchange is for NQ money. You were talking about IRA earlier as non-savers getting started after emergency funds set up at banks would & should 1st be looking at retirement accounts such as 401k traditional or 401k roth if offered or Traditional IRA or Roth IRA depending on their preference or situation
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- 4,886
They can move as they want, but when it is a proposed strategy by a rep who makes commission, it will likely fail all suitability standards because of costs or surrender charge schedules or new surrender charge schedules.
Not sure you can make the statement it will be moved to a better returning product as it may be better or may be worse. A bonus product is not guaranteed to be better returning, but it is guaranteed to have either larger fees, larger surrender charges or longer surrender schedules.
Withdrawal penalties dont work like that in terms of earned interest or contribution only. The surrender charges almost always apply to the entire account value.
I have seen older clients in their 50s or 60s or 70s with large balances in IRAs in the stock market that are scared of major losses when the stock market has had a long run of good returns choose to move most or all of the account to a fixed annuity with guarantees. Then, if they want to systematically go back into the market in the future, they could do rollovers each year of small amounts such as the interest or their 10% free WD. But rarely is the rep involved the same person doing the transactions & the consumer many times gets used to the low guarantee & likes to stay in it for safety.
Again, have them do the saving elsewhere, then in the future you might have lots of clients with big 401k balances that can be rolled over when they retire or change jobs. Good for them & good for you in future to handle 100k rollovers instead of $25 per week contribution account applications
- Thread starter
- #27
- 5,995
As always, thanks Allen . . .
I get what you're saying about an Agent recommending this strategy as not being wise. I most def want the concept to be compliant.
How does this sound:
Mrs. Jones - since we've taken care of your Life Insurance needs, all you need to do is start the "Savings" part. There are several ways - open a Savings Account at a local bank, open an IRA ( or participate in your Employer's 401k, etc ) and there is an awesome product called a Flexible Premium Annuity that is available. Plus, if you need additional advice, we can recommend a Financial Adviser Partner in your area that could help you further . . .
I just want to make it easier for the Client to do the "Saving" part. Back in the day - not many did.
1.5% doesn't even come close to keeping up with inflation, and its typically a bad idea for young folks to be locked up into annuities.
Ray said something that is important... an emergency fund. If they don't have at least 3-6 mos of expenses in savings (specifically earmarked for emergencies - not in their revolving checking acct), they should do that first before putting that money somewhere else (ie: investing).
Buy term, save for emergency fund, invest the rest (in a non annuity). A good goal would be to have them contribute to their 401k up to the match, then fund a Roth IRA outside of employer, up to contribution limit. My .02
Ray said something that is important... an emergency fund. If they don't have at least 3-6 mos of expenses in savings (specifically earmarked for emergencies - not in their revolving checking acct), they should do that first before putting that money somewhere else (ie: investing).
Buy term, save for emergency fund, invest the rest (in a non annuity). A good goal would be to have them contribute to their 401k up to the match, then fund a Roth IRA outside of employer, up to contribution limit. My .02
- Thread starter
- #29
- 5,995
When I woke up this morning - I clearly decided for us to use the word "Save, Savings" -vs- "Invest, Investment" - this will help avoid confusion.
Yesterday, an Edward Jones dude I called for advice said the same thing - have the client put back 6 to 12 months of normal expenses for Emergencies and then start their quest to "Save" for the future, retirement, etc.
If they have an Employer - then most def encourage max matching the 401k or whatever they have. I like the idea of the ROTH IRA outside the employer too. Still encourage them to start the Emergency Fund too . . .
I'm not concerned on making money off the upfront items - I want their Life, Health and Annuity business. I may be dead before it's time for the Annuity business with the younger crowd.
Thanks for the advice everyone. We have a clear direction of where this concept will go.
