Equity Indexed Annuities: Are they the real deal or junk products?

[senior-advisor-indiana]

If you are offering IA's to seniors then the amount of the return doesn't mean diddly squat. I think this is what winter is saying also. The majority of people that I sell the IA to buy them because, they want safety and they want thier money to bypass probate. They really don't care how much it grows, they just want to make sure its left for thier kids.

Most of the people should probably buy life insurance to pass the money on but then they lose liquidity,(not really but they think they do) and alot don't qualify. No one knows how the IA is gonna perform regaurdless of the calculaters, you do know they are not gonna lose a dime, and are gauranteed to grow.

If you are selling to seniors, you need to be selling the gaurantees. If they wanted to get double digit returns they would stay in the market and cross thier fingers.

 

[James]

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On every balance sheet I've ever looked at that shows ten to twenty years of returns, the determining factor is NOT how much was made or the size of the return, but HOW MUCH WAS NOT LOST.

I don't think I've ever met anyone who ever made 10% more than they lost over a period of at least 10 years. I'm sure there ARE some (a lot of) people, but my guess is that they are the more savvy investors. Your average, garden variety wage earner who is an active trader is basically a poor investor.

My generation (babe-booms) have gone through 2 huge market crashes (87 and 2001). We are terrified of out-living our money. And to make matters worse, our rates of saving have been terrible.

We will be coming into inheritances from "greatest generation" parents as well as coming into 401 retirement money. I don't believe we want to put a lot of it into equities... not again. I think annuities will look very good to a lot of us. They do to me (and no, I'm not licensed in CA to sell them... I've not taken the required 8 CE units.)

That's my take, YMMV (your milage may varry).

Al
www.insurancesolutions123.com

This is a very common thread amoung people entering retirement. Very well put Al.

 

[rmalcom]

Go to www.eannuitycoach.com

 

[senior-advisor-indiana]

why?

 

[arnguy]

I have some hesitation about using www.eannuitycoach.com because on their opening page they tout the B-A Close presentation (scheduled for July 18th at 11:00 AM) as a means to "Find out how you can use Single Premium Life Insurance to compliment your annuity practice." I would rather find out how it would complement my annuity practice.

And, Al, EIAs are dsigned to protect the owner from any downside loss. In return for this the owner has to give up some of the upside gain because of a cap. The gain also is dependent on the type of crediting methgod as well as which index is used. The insurance company investment is in stock options. Since EIAs are basically fixed annuities I believe they are safe and a fairly conservative form of investment. I believe it was Will Rogers who said (to paraphrase), I don't care about the return on my money, what I want is the return of my money (or something to that effect).

 

[J.R.]

I have some hesitation about using www.eannuitycoach.com because on their opening page they tout the B-A Close presentation (scheduled for July 18th at 11:00 AM) as a means to "Find out how you can use Single Premium Life Insurance to compliment your annuity practice." I would rather find out how it would complement my annuity practice.

And, Al, EIAs are dsigned to protect the owner from any downside loss. In return for this the owner has to give up some of the upside gain because of a cap. The gain also is dependent on the type of crediting methgod as well as which index is used. The insurance company investment is in stock options. Since EIAs are basically fixed annuities I believe they are safe and a fairly conservative form of investment. I believe it was Will Rogers who said (to paraphrase), I don't care about the return on my money, what I want is the return of my money (or something to that effect).

HaHa, perhaps they are paying homage to the life insurance.....

 

[arnguy]

Salpro, I believe you are correct!

 

[Chris235]

I'm new to this forum and I don't have my securities licenses. Why aren't people with security licenses allowed to give their general impression of different investments? I understand that each person is different, but what harm is there in generalized information with the understanding that it is an opinion and not specific to any one person?

 

[J.R.]

I'm new to this forum and I don't have my securities licenses. Why aren't people with security licenses allowed to give their general impression of different investments? I understand that each person is different, but what harm is there in generalized information with the understanding that it is an opinion and not specific to any one person?

Because an individual needs to be an expert in what they sell. I'm an expert at selling health insurance because I know the products and go above and beyond in understanding the finer points of the health insurance field. I could not w/ a good conscious talk about P & C insurance because that is not my area of expertise. Want car insurance. Do what I did and call Geico or I can refer you to an associate.

I have never been solicited by a P & C guy selling car insurance and probably would switch if the plan was cheaper and sold by a reputable company. Other lines of insurance are a different story and require the expert advise of somebody how knows his or her niche.

 

[Chris235]

From what I've seen of IA's, they can be good, just like anything else for the right situation. They can be especially helpful for those clients who don't like risk and park all their money in CD's, and get that 1099 each year, even if they just roll it over into another CD. The IA can be a way to get them something that is safe and allows their money to continue to grow tax free. I'm not saying it's for everybody, but it is an option.