"Recovery" Annuity Ideas - Suggestions?

[Freddie]

The public got hammered in 2008 and 2009 with Zero's Hope & Misery is looking just as bad. Look at the S&P 500 chart starting in June 2008 when Hillary lost the nomination and you will see why it's down down down. Hildabeast is no prize but she is marxist-lite compared to Dear Leader. The point is the market discounted you know who and as his polls went up - the S&P 500 kept sinking. I digress.

So you run into prospects and they say "I have to stay in the market with my broker to recover." Well 1 month in and we had the worst S&P or Dow since 1931 in January.

I need some ideas and maybe someone can help and it may help all of us.

The choices could be stay in the market or EIA. You show the client a possible 15% gain on the S&P 500 if they stay in the market OR in an EIA. What we need is an EIA that gives a 10% bonus first year. Something with like an 80% participation and no cap? A or A+ rated? Anything like that?

Stay in the Market:
$500,000 x 1.15 = $575,000

EIA with 10% bonus up front, 80% particpation & no cap(?)
$500,000 x 1.1= $550,000 x (1.15 x 0.8 )1.12 = $616,000
So we are getting 80% of the 15% up on the S&P 500 or 12%.

Is there any EIA that will fit that bill? The new American Equity looks pretty good. Amerus? A or A+ rated?

Any other ideas you are using to help people "recover?" Thanks.

 

[Justin Bilyj]

i cant wait to sell annuities!! is that greek or latin???

 

[arnguy]

i cant wait to sell annuities!! is that greek or latin???

It's insurancespeak!

 

[Justin Bilyj]

is that like legal jargonese?? lol

 

[Freddie]

i cant wait to sell annuities!! is that greek or latin???

Hey dude - I really like Ron Paul too. He was probably the brightest guy out there with the exception of Romney. He was also not bought and paid for. Tancredo, Paul, Duncan Hunter and Fred were probably the best choices.

I was posting a legitimate question and was hoping for some legit answers or hopefully discussing some ideas to help others. Sadly, a lot of Ron Paul "supporters" hurt Ron Paul's chances. I can see another example here.

BTW - Ron Paul like all the others in Congress turned out to be a coward when Cheney called the vote. Americans just needed one Representative and one Senator to ask about Dear Leader's failure to provide evidence of natural born citizenship - they are all cowards. People contacted Paul and others to speak up but they all wimped out.

 

[Charpress]

So you run into prospects and they say "I have to stay in the market with my broker to recover."

It isn't so much coming up with an ideal annuity for everyone. There are just too many factors that are perhaps more important than yield, like death benefits.

It is more important to show people why following a broker's advice to "stay the course and stick it out for the long run" is total BS. Of course that is what they will tell you. If they don't, then they are admitting they have failed you. What are they going to say? "Yeah, I've been so wrong. You should sell now and go liquid before you lose everything." It will never happen.

Put it in terms everyone should understand. "The U.S. had the hottest economy post WWII that the world had ever seen. Looking back 50 years, it was not unreasonable to claim that the market might average 8-9% if you stick for the long term. However, do you really think the next 50 years will be a repeat of the last 50 years? We have gone from the largest producing nation to the largest consuming/debtor nation. We just are not going to see that kind of growth again. You need to consider getting into guaranteed investments and away from risk investments that are based on flawed logic."

I haven't run into anyone over 60 who does not agree with this. By the way, the market in the U.S. for 100 years before the roaring 20s averaged more like 2% growth per year.

 

[padthaiforlunch]

Americans just needed one Representative and one Senator to ask about Dear Leader's failure to provide evidence of natural born citizenship - they are all cowards.

Man, it's going to be a long eight years for you. Hope you enjoyed the last Administration.

To answer the main issue in the thread....

Ask them how much more they are willing to lose in the market. Moving to an FIA doesn't lock in the losses, it creates a stop-loss. Now find an FIA with a decent bonus and a good pt.-to-pt.

An added bene for non-qual accounts is the cap gains loss, which can help offset conversion costs if the want to move qaul accounts to a Roth.

 

[insurehound]

a lot of "possibles" and "maybes" in your statement Freddie. How about a short term MYG annuity to ride out the storm? That bonus will look pretty small if we have more than 3 years of poor market performance and the client may not feel good about locking up their money for 7 or 10 years.

 

[Freddie]

a lot of "possibles" and "maybes" in your statement Freddie. How about a short term MYG annuity to ride out the storm? That bonus will look pretty small if we have more than 3 years of poor market performance and the client may not feel good about locking up their money for 7 or 10 years.

This might be a possibility. I think it might be easier where they would get a 10 or 12% bonus.

 

[Charpress]

Ask them how much more they are willing to lose in the market. Moving to an FIA doesn't lock in the losses, it creates a stop-loss.

Here's what I have done: I draw a big pie chart on some 11x17 paper I keep handy. "Now, how much did you say you've lost? 35%?"

Then I draw a big wedge representing about 35% and draw a big "X" through it with a red marker. I then hand the red marker to the client. "Please show me how much more you are willing to lose."

"Huh?"

"Yeah, just draw another wedge on here somewhere to show how much more you can afford to lose so we know where the limit to your losses will be."

Point made. I've never had someone doodle on my drawing with their own wedge.