Blogs

Month: June 2021

Annuities: Friend or Foe?

Annuities: Friend or Foe?

Annuities. I’ve talked a lot about them, and I believe strongly in their value in a sound retirement plan. But despite what they can do for our clients, they need a reputation overhaul. We tend to think of them more as a necessary evil than as an essential resource for guaranteed income. They are the dreaded A-word.

Let’s change that. Last week, I talked about why annuities provide that needed drag to obtain maximum life when it comes to achieving maximum success. And in today’s market, that lift is more important than ever. But instead of just talking about it, it’s important to look at the numbers. What’s changing today that makes income so important? It starts with market size. More and more Americans are shifting from workforce to retirement, and we need to shift our focus to properly hit their needs.

There are three main components to be aware of:

  1. Only 51% of Americans believe that their retirement assets will last for their entire lifetime. That means our population basically has the same odds of a coin flip. One person feels they have enough income to provide for their lifetime, the next does not feel that way.
  2. We’re seeing dramatic drops in government programs today. Social security is scheduled to drop as much as 24% in about 10- 12 years. For most Americans, that’s a significant hit. Think of your clients. Would they still have enough to retire is Social Security decreased dramatically?
  3. If they have protected income in their portfolio, 78% of Americans believe that they will have income for as long as they live. For those without protected income, that number drops to 41%.

So, if we go by the numbers, it seems clear that clients are interested in protecting their income in retirement, and that government programs, such as Social Security, won’t be enough on their own. And that means it’s time to get comfortable with annuities. You’ll have a better chance of attracting quality people and therefore gaining assets under management.

Take the first step and talk with a retirement income consultant. They can walk you through our proven Income Alpha approach that allows you to increase your clients’ guaranteed income without sacrificing assets under management. It’s still Annuity Awareness Month, the perfect time to increase your probability of success and change the way you think about annuities. Call (800- 589-3000 for more information.

Transformational Tactic

It’s time to change the way we think about annuities. Use our Income Alpha approach to provide guaranteed income, and a brighter retirement, to your clients.

Posted by hpp
Taking the Drag out of the Annuity Conversation

Taking the Drag out of the Annuity Conversation

I read a great article by Brian Kight this past week called What Real Leaders Understand About Resistance. In the article, Brian talks about the value of drag as an airplane takes off. He specifically points out that, “Thrust must exceed drag to create forward movement and the speed necessary for flight.” This concept of thrust exceeding drag applies to more than just an airplane.

 For an airplane to gain speed down a runway, the pilot must push the throttle to create the thrust. The plane is immediately met with the resistance of the air around it—the drag. Brian’s point is simple: we must anticipate the drag if we want to get any lift. We must generate enough thrust to overcome the drag. 

For many advisors, annuities can feel like that resistance—they are the drag keeping us from earning more assets under management. After all, if the money is tied up in annuities it isn’t available for other investments. But just like drag is necessary to get a plane off the ground, annuities are a vital component when it comes to giving your client’s retirement plan enough thrust to meet their goals.

Yes, when you place an annuity for your client you are taking those assets out of assets under management. But you are adding the ability to provide protected income. You are effectively taking longevity off the table. And you are securing that risk, which gives you the lift necessary to grow your client’s assets. And one of the best ways to add an annuity to a financial plan, without sacrificing assets under management is with our Income Alpha strategy.

For advisors using this strategy, we are seeing anywhere between a 23-36% increase in the lifetime client value of our assets under management. We’re also increasing the probability of success by as much as 25-30% in many cases. That’s because, by leveraging annuities properly, you can provide the needed income without giving up investments.

 Find out more about how Income Alpha works by reaching out to our retirement income consultants at (800) 589-3000. They can show you how the strategy takes annuities from adding drag to providing thrust — and therefore success — with your client’s portfolios.

Transformational Tactic

Don’t think of annuities as drag. Discover why they are a necessary component of giving your clients—and your business—a financial lift.

Posted by hpp
New Life for Annuities

New Life for Annuities

June is National Annuity Awareness Month, so let’s raise awareness! Today, I want to share different strategies for helping your clients benefits from adding annuities to their financial plan. And it starts with education. I’ll give you three reasons to educate your clients on the importance of annuities.

  1. 78% of Americans with annuities believe that they will have protected income that will last, versus only 41% that do not have protected income through annuities. In light of possible reductions to Social Security, it’s more important than ever to look to additional sources for guaranteed income.
  2. There’s been a 44% increase in the number of Americans that are living to age 100 just since the turn of the century. Over the last 20 years, and over the next 40 years, it’s anticipated that the number of Americans living to age 100 will grow by six times, creating significant pressure on our assets under management.
  3. The number of Americans turning age 65 will increase in the next couple of years to 12,000 people per day. As workers become retirees, you need to help your clients plan for income, rather than just accumulation.

These changes will put significant stress on our economic systems, making competent financial advisors even more valuable. We need to be able to get our clients in a position of having protected income. No matter how you look at it, failure of a portfolio and hitting zero is catastrophic. Guaranteed income, however, takes away some of the burden.

Our retirement income consultants are ready to help you understand these changes and put guaranteed income in place. Call them at (800) 589-3000 to learn more about how annuities can increase the probability of success in your client’s portfolios.

Transformational Tactic

Increase your clients’ guaranteed income, and their probability of success, by adding annuities to their portfolios.

Posted by hpp