3 things you HAVE to say to your clients! | 7 Figure Annuity Sales Podcast | Ep. 189

Today we're going to talk about three things you should be talking with your clients about.

Hey, everyone. Welcome back to this week's episode. I am Chad Owen, the owner of Retirement Realize Financial, the one stop shop for all agents looking for a new FMO and Retirement Realized Agents Academy. If you need training, we can train you. Well, not all of you, because some of you can't be trained. But anyway.

I did. I had an agent that was with us for years and I just kept asking the same questions. So can you explain to me the index strategies again? Like, oh, my gosh, when the market goes up, you get a portion of the gains. When the market goes down, you stay flat. It's that easy.

It's that easy.

That. So it's that simple. So get us started.

Yes. Three things.

Oh, and if you want guns, it's heavensarmory.com. that's my other company. If you want branding, it's increase you dot com.

Yes, we use them.

We use them. Okay, so now back to our rigorous.

You're looking to retire and you want to learn about safety and security. It's Eagle Shadow Life and Annuity.

That's mine. If you're in this business and you're looking for me to help you retire, you're a good place to be.

You're in good.

You're.

It's like Allstate. You're in good hands.

No, we're way better than Allstate.

There you go. I like it. All right.

Yeah.

Okay.

We're in his hands.

We're in his hands.

Yeah, that's way better than Allstate. Yeah. With a capital H. You know, you.

Can fit the whole world in his hands.

Yep. But not your big head. So.

Guilty is charged.

Go ahead.

Sometimes I'm. I'm surprised I was able to get a half ton pick up.

Yeah. Well, anyway.

Yeah.

What are we talking about?

3 things you should be talking about with your clients. Number one, future income projections. Okay. When you're talking about current income, you talk about future income, you talk about retirement income, you talk about pensions, you talk about Social Security, you talk about guaranteed income, you talk about non guaranteed income, talk about all their future income income. And worst case scenario, he dies. What does she get? She dies. What does he get? Right? I mean, that's. It's pretty simple and straightforward.

And this one, actually, the guy asked me, he goes, when I die, how much do I get? Nothing. You're dead. It always. They always get that moment. They're looking at you like, oh, yeah.

You don't get Anything.

She on the other hand.

Okay, but that's important and it's part of the fact finder. If you're not a part of retirement realized agents academy and you need a good fact finder, you should be a part of realized financial or retirement. Realized financial. You should use Chad's fact finder. We give it to you in the academy.

And I just changed it again. I actually finished it. So I will send that over to you.

Awesome. Yep, we'll get that update.

That is by far the most changed document I have, hands down. Yeah. Because I'm constantly adapting it to current market conditions, quite frankly. Like for example, long term care has always been a question on there. But I tried to make it really trying to impact even more because statistics continue to go up.

Right.

The importance of long term care of some sort. Not a long term care policy, but something with living benefits.

Some kind of.

Yeah, because I'm just not, I'm not convinced on actual long term care policies. If they keep raising the rates and eventually they can't afford it. So if they cancel it, who keeps all the money? Insurance company. They lose all the money they put into that. Right. So if you do the right plans, that's not the case.

Yeah. Yeah, that's good. And obviously there's some annuities with some kind of living benefits that you can get with those that are designed to kind of, you know, aid long term care. There's life insurance with living benefits. There's different things you can, you can do to structure that.

If I do get a little bit of froth on my mustache, just let me know.

I'll let you know.

Because this is also on YouTube as well.

Yeah. For those of you that are listening on the podcast, subscribe to YouTube. Hit the like button on the YouTube.

Ring the bell and make a comment. Yeah, I got my radio thing going today.

You do? It's interesting.

It is interesting.

You're like three sips into that coffee. It already seems like it's hitting.

It's just the smell of the coffee. It just triggers increase.

That is hyperactivity.

Interesting.

Yeah, I was kind of a dud before.

Okay.

Looking at future income projections.

I'm really glad you don't smoke because if you did, the way you laugh, you'd be the wheeziest person out there. Okay.

That like airy laugh.

Yes.

Okay, well, anyways, okay, so you're looking at future income projections. Obviously you're planning from a worst case scenario. You need to understand super important.

And from the worst case scenario because the reality Is I want my clients. If, if you can. I mean there are certain clients you meet with that worst case scenarios, you're never retiring.

Right.

And that actually unfortunately happens way more than I, I would like to see. Yeah, it doesn't matter even I even have clients where even with their two Social Security's put together, they still can't retire.

Yeah.

And why so many people right now at 30 at, at 60 plus years old are taking 30 year mortgages out? I'm just saying.

Beats me.

It just. Well it's because financial advisors are telling them, oh well, hey, you know what, you don't want to put your 200,000 into the home and pay for that. You want to take the loan for 30 years and then take the money that you could have put in that put in the stock market which averages 9 to 12% returns. I'm telling you, I'm hearing that all the time now. And I mean that's what they're telling. Yeah. So now you put it in towards the top of the market, stock market loses 50%, you're 200,000 now a hundred thousand. Oh, but it's IRA money. So now you have required minimum distributions and you know what, or non qualified, it doesn't matter. They're still having to use someone to live off of but now they experience a loss, but now they have a 30 year mortgage on their home. It's just.

Yeah, it's a mess. Always worst case scenario, plan for the worst case scenario. And here's the thing too, if you're selling annuities, you're using annuities for clients you don't have to annuitize. Obviously look at income riders don't annuitize. Yeah, I mean I don't like it. I think that it's, it's not a good way to try and plan. It's not needed anymore.

It to me that the annuitization was really an 80s and 90s type scenario. Nowadays with the income riders that are available, with the participation in some index growths and with the minimum guarantee on income riders, there's just no reason in my opinion to do that anymore.

Well, and that's the beautiful thing about the income rider to me is that a lot of times you do get roll up rate so you've got some kind of guaranteed growth already built into it to try and increase your benefit base so that your benefit base is higher so that when you're actually taking a withdrawal factor, a payout factor of you know, whatever percent it is, which a lot of times can beat the standard old 4% rule. It's actually a higher percentage on a larger account and it's guaranteed for the rest of your life. Yeah, but I don't want to pay, you know, I don't want my clients to pay a fee. It's like, it's a fee for guarantees.

You don't want your clients to pay fee. But you're in a brokerage account, you get to pay fees. Oh, you also have mutual funds and then I have fees.

Yeah.

What do those fees get you? Absolutely nothing. No guarantees. Okay, yeah, you're just trying to get me to rant today.

Well, you're caffeinated now, so it's a little bit easier.

I'm only at a quarter of a way. Yeah, okay.

Okay. Number two, number two, something you should be talking with your clients about. Propose. I'm sorry, Propose the purpose.

Excuse me, I was going to say. Where are you going with this?

The purpose of the different bunches of money that they have. Right. So IRA, 401k, non qualified accounts, stocks, bonds, mutual funds, you've got all these different types of money. What's the purpose of them? Individually?

Well put the reality. All money goes into two things. Plan for living, plan for dying, that's really every category. Money you have out there has that purpose. Why? How many set aside for taxes? Well, that's plan for living. I have a plan for vacation mate. That's plan for living. I really don't need any income off of this. I have more than enough income coming in I just want to pass on to my heirs. Plan for death, right? I mean that's the only two purposes money has.

Right? But you need to look at it for each.

You do. The reality, it's kind of a tough thing because I also look at the scenario of, you know, you have your IRAs which has your required minimum distribution. So you already know you're going to be pulling from that anyway. Roths, of course. Tax free money, tax free growth, non qualified money is where it becomes a little tougher because I have had people say, you know, I got $15,000 in credit card debt, should I put that into annuity or should I put that into paying off the deb? Like what's the interest rate on your credit cards? 12%. Well, that's kind of a no brainer, right? You know, but the key is this, if you're gonna pay off your credit cards, make sure you don't keep charging on the credit cards more than what you can pay every single month.

Totally.

So, you know, or I had Someone, this was a real creative type deal. They had $200,000 in non qualified funds. So they said, what should I do? Should I pay for my house this way or should I do a loan and do it? They were going to take a 15 year loan out at this time based off of what the payout was and what their ages were. We were able to do the 200,000, use the income from the 200,000 to pay for the 15 year loan and another 15 years the homes paid for and they still have income coming in nice. So, but that's just, you know, that's a unique circumstance and everything has to line up perfectly there. But it worked out, it worked that way because we all know an annuity, especially when you people say, well I want to take an annuity or excuse me, I want to take 200,000, I want to buy a rental property and get income that way. Well, first of all, we all just saw recently that you can live in a home and you don't have to pay rent, right? I mean, because that's just the fact. Forget about the person that still has to pay the mortgage, you don't have to pay rent, right? So that puts that person in buying. Plus refrigerators break down, ACs breakdown, roofs need to be replaced. I mean there's all sorts of things. So I call the annuity an infinite rental without a tenant.

Yeah, you don't, you don't have all the repair costs you don't have to.

Deal with or knocking on the door, hey, rents due? I'm sorry, I can't pay rent right now.

Yeah, you can get your check. Yeah, that's good. Well, the purpose of different money then this is something that I've talked with agents about a lot is I'm helping them with case design. They're part of the fmo. I'm helping them, you know, because a lot of times they'll ask me though, because they'll go through the mini fact finder on the phone. The mini fact finder is the questions you should be asking when you're making a call to go into your first appointment with a reasonable plan of action or you know, customized illustration, things like that, to actually go over the concepts in a tailor fit, customized way to the client. And the agent will ask me, well, Caleb, how do you know, like how much you should run that illustration for? You haven't gotten into their income stuff because that's on the full fact finder, right? It's like, well, that's true. The mini fact finder you have figured out what they have in their IRAs. You have figured out what they're having, their 401ks. You looked at their stocks, bonds, mutual funds, what they have there, non qualified accounts, emergency funds and savings.

Where are you doing this?

Mini fact finder.

You're finding out where they have their.

Funds on the mini fact finder. It's, it's at least outlined there.

Yeah. Just qualified, non qualified. Yeah. So just to be clear, because I don't want them thinking you break that all down on the.

You don't have to break it all down.

How much do you have in non qualified. How much do you have in your IRAs? 401ks qualified accounts. Correct. How much do you have in your non qualified accounts? Brokerage accounts, checking, savings, money that's already been taxed. And I just leave it at that.

Yeah. But generally when you look at qualified accounts, period, 401ks IRAs, those kind of those have been created and set aside and allocated to grown for the sake of retirement.

Purpose of those retirement retirement, it's not to take that 500,000 and pay $200,000 on the home. And now puts you up in a 25% tax bracket. Then now you're taking that out of your 200,000. So it's 50,000 less. So instead of 200,000 you have 150,000. Why would you pay taxes on that?

Right.

You know it's.

Yeah, yeah, but you're right, you can use that right to go in. And now you know what you should be illustrating in the first appointment because you've seen what they've gotten these different. It just makes it a whole lot easier. You need to be doing the mini fact finder. But that comes down to the purpose of the money. There are certain accounts that you can look at like a 401k, a 403b, an IRA.

Know those jobs.

You know what it's.

You tell your money what to do or it tells you what to do.

Exactly. And then the third and last one, Chad, is the what's their willingness to lose money? Right. And because you pose the question a little bit differently, it's not what's your risk tolerance? Because people are trained to say, oh, moderate, moderate, right.

So you're willing to lose 30%. No, no, that's moderate.

Right. So you, you frame it differently. Are you willing to lose all of your money, some of your money or none of your money?

It always gets a chuckle die. I don't want to lose any of my money. Well, just out of curiosity, why do you have all your 401k or your IRAs and stock, bonds and mutual funds. Now, remember, I am not telling them to buy or sell anything.

Question.

I'm just asking them, if you're not willing to lose any money, why do you have your money in stocks, bonds and mutual funds? Huh?

I mean, now the gears are turning. Yeah.

You don't. I mean, anybody who's not serious, license. You cannot recommend somebody in getting in or out of a product.

Right.

But you can sure ask questions that make them think about if they should get in or out.

Right. And then they make the decision.

So what do you think I should do? Well, that's up to you. I mean, you said you don't want to lose any money. So therefore you got a product so you can't lose money in. So you have to make the decision. That's what's best for your situation. And I will tell them so multiple times in appointment, I will say, I cannot tell you whether you should get in or out of any sort of variable product whatsoever. I can't. So you have to make the decision.

Right. You. And you tell them that this affects your retirement far more than it affects mine. That's why it is your decision.

Yeah. And it really comes down to. I mean, I follow things to the T. When they say you can't make recommendations of somebody getting in or out of a product. I don't.

Right.

But if somebody say, well, what do you think of gold? Well, can you lose money in gold? Yeah. Well, then what do you think I think of gold? You don't like it? Well, I don't like it for retirement purposes. That doesn't mean you should or should not have it.

Right.

That's up to you.

Right. So, yeah, it's true. So the three things to recap, looking at their future retirement income projections, talking about the purpose of the different bunches of money that they have, and then lastly, their willingness to lose, protect money, whatever. Yeah. However you want to word that.

Yep.

So those are the three big ones that you need to be talking with your clients about.

That's it. Well, I hope this helps you guys. It's that simple. Have a great day. And of course, happy selling.