Preparing for a Recession | 7 Figure Annuity Sales Podcast | Ep. 197

On this week's episode, we're going to talk about preparing for a recession.

Hey everyone, this is Chad Owen, owner of retirement realized financial owner of retirement realized agents academy and the annuity sales coach. Here is the one of the most important people in my life life. Easily the top 1000 now. I mean I know 999, but easily top made the top. Definitely, definitely one of the most important people in my life. And he actually does keep me pretty well, let's say informed of new things, new trends that are going on in the industry. Because you talk to a lot of agents.

I do talk all the time.

Some days you could just leave it at that. I do talk all the time.

You talk all the time. But I mean there's days, it's seven hours on the phone.

Yeah, but it's, it's amazing because you get all these different perspectives from people have been in business a long time. People that are brand new.

Oh yeah.

People that are doing really well, people that are not doing really well, people that understand what marketing is, people who don't understand what marketing is. So you get a good, you good perspective.

I will tell you, this is not even in the notes, but there is a consistent indicator for success in the business.

What is that?

I mean it's almost a perfect correlation between agents who treat what they do selling annuities like it's their business versus agents who treat selling annuities like they're just a salesperson for an insurance company.

Yeah, and that's, that's a good point because you know, if you're. Man, who was that, I heard this one time that only an entrepreneur would work 80 hours to make the same amount of money as someone who worked for someone else for 40 hours.

Yeah.

But the reality is if you're working 50, 60 hours here, you are killing it. If you're doing it right, you should be. Now I, we've talked about this before. If I just focused on just my annuity business, not all my other companies, not my training, if I just focused on that, I'm probably working.

40 to 45 hours a week. I mean there's some weeks where I'm working less than that. Sure. But I would say, and that of course includes driving time and everything. And you know, there's always that thought process of I could bring to where I have people coming in the office. But man, that drive time is my leveler. It keeps level headed. I do because I just, that's my time for Bible podcast, worship music or literally just sitting there and thinking you know, you know, because there's a lot of things to think about. But the other thing I look at too is there's a lot of people that appreciate the fact that I'll drive out to their place.

Very true.

And that's a big help. I'm in their environment, they're not in mine.

Yeah.

So I know for a fact people don't have to work a lot hours to do very well in this business.

Well, and from, from the very infant stages of you running business, writing business, it was viewed with that mentality of, this is, this is my business. If you approach from the standpoint of you're just trying to close some annuity sales and, and that's really the extent of it. Yeah, You. I mean, Kylie, it doesn't take much written business, issued business to, to make, you know, pretty. Pretty stinking good money in, in this industry.

I mean, you think about if you write 4 million a year and you average 7% commission, 200 to 80,000 a year, there are doctors that don't make that. There's doctors that make half that.

Right.

And they have way more cost and insurance and all that. I mean, it's unreal what we can do in this business. But the beauty behind this is if you're a doctor and you make, let's just say, 300,000 a year, you still lose patience.

Yeah.

Like, patients still die. With my clients, nobody dies.

Nobody dies.

From the standpoint of financially, they never lose money, they never run out of income, they never die. I mean, it's unreal what we get to do. So, you know, with all this talk of death and turmoil, and we're obviously talking about prepping, becoming a prepper, getting.

Prepared for what a lot of people are calling for recession on the horizon.

Yeah, they are. And it's, and it's pretty clear. I mean, come on, you have to have your head in the hole in the ground to realize what's going on. Right. And the problems, I mean, there's just everywhere you look, there's uncertainty and it's not doom and gloom.

Right.

I honestly, I mean, didn't. Didn't I just have a meeting a couple weeks ago about saying, hey, we will not have anybody lose their job. We will not have cutbacks, we will not have anybody with pay decreases. We're just. We won't. Right. And I did that in March or April of 2020 when everything was going. And what. Not only did we not have any of that, everybody else is making way more than what they were then. We've Expanded and we have a bigger team. I can't wait to see, honestly, what happens during a recession, because even the top economists right now are calling for recession. And it's not Republican or Democrat thing from the standpoint of we know who's likely causing it, but that's a whole nother story. But the thing is, is anybody in any background right now saying things are not looking good?

And I just literally had this thought of, like, so glad that I'm not in the space of managed money doing risk. Risk. And this is just a personal thing, because I'm looking at the S P500 is down over 16% year to date. Okay. It's down over 4% over the last, you know, year from, like, calendar year.

Yeah, this is a week ago.

Yeah, this is. Yeah. So by the time this podcast comes out, it's. It's a little bit. Yeah. Different. But as we sit today, it's down over 16% year to date. For. I'm in risk. You know, I'm dealing with risk investments. Almost.

That's almost bare market.

Yeah, almost.

I.

Then I've got clients who are moving their money, so I'm making less. And I have clients that are upset calling me about what they've lost.

Which is even bigger concern, though, because I've been on this side from the standpoint of people calling into my show or calling. I'm calling them from one of my Internet leads, and they are scared out of their stinking mind right now.

It's wild.

You know, there's more. More people right now. And I think of a guy, actually this guy in February that free looked a $600,000 policy, and it's like, hey, I'm staying in the market. I'm going. And if somebody does that, I don't reach back out to them because they've made. Then. Then I could be the guy that goes, oh, you convinced me to get back into the annuity. I just don't reach it. You made your decision. It's your money, not mine. But I can't even imagine how much he's lost if he stayed in the market. Because what the NASDAQ is well into.

Be over 26% year to date.

Well, well into bear. Yeah.

Yeah.

Funny that you did this, because I actually looked at the same thing. I did the same thing.

Well, so here's. Here's the exact numbers. And this is, you know, again, not perfect for the time you're listening to it. S and P at this point in time, down over 16% year to date. Down over 4% over the last full year. Dow is down over 11% year to date, down over 6% over the last full year. Nasdaq's down over 26% year to date and down over 12% over the last four year. Wow. The feds just approved a half a percent interest rate increase which is the largest bump since 2000. And inflation rate was 8 1/2% for the year prior to the end of March 2022.

Wow.

So inflation is up, interest rates are up, market is down.

And there's a whole lot of other factors that can play into it obviously. But it's a pretty, it's a, it's a daunting looking environment right now and.

We, we can't switch over to our political platform yet. But you know, the reality is this administration's causing a lot of problems. And this is not a Republican or Democrat comment, this is a factual comment. I mean there are, you cannot blame the supply chain anymore. You can't blame oil shortage. You can't. These are decisions that are being made that are affecting everybody right now. And it doesn't, it's funny because when things like this happen, the only people that could somewhat say that they're not affected is the people that have surplus in income. But that can catch up. We keep having 6 to 7, 8% inflation, that can definitely catch up. And you know, because you can't even say, well, the people that are relying on government aid, they're not feeling it. Oh, absolutely. Are things, I mean, I know clients are people that I wanted my help but I couldn't because they don't have enough money. And they're like, what do I, what do we do? We're losing money or we don't have money and gas is twice as expensive. They don't even get out, don't even get to go and do their normal things. And it's unbelievable to be in that situation. This is why if you're younger, it's so important to plan for stuff like this because you have no idea what it's going to be like when you actually retire. Right. And I'm talking about our industry people, you know, they think they can spend, there's so many people in our industry that spend what they want on what they want right now. And then all of a sudden they think they can over, you know, live in, let's just say beyond your means lifestyle. And then the market starts to tank and you go to retire, you're not retiring.

Right? Yeah.

That's why we see some agents that are working at 70, 75 years old. I'm not talking about the ones that want to work because they just want to. They like it. It's the ones that have to do it. And they're still trying to work 40 hours, 50 hours a week. I don't care who you are, man. Generally when you're in your 70s and you're trying to work 40 to 50 hours a week, and especially if you're road wire, that's really tough on the body and tough on the mind.

It's true. It's true. I was, I was talking with an agent earlier this morning about just inflation in general. And you know, the federal government has expenditures. Right. And those expenditure like they're even. The federal government is not like.

They can't avoid the effect of inflation either.

No. Right.

So what's.

But they can pass it down to everybody else.

That's what I was going to say is what. What's the logical thing if you got an 8 1/2% inflation rate, what's the logical thing from a taxation standpoint? Yeah, Logically taxes should go up.

One is funny because I go to debt debtclock.org and there was funny, it said that the number of people, the official number of people unemployed right now. And it gave. I can't remember the exact number, but then it said below that the actual number of people unemployed was twice the amount.

And the reason why. And most people don't know this, but there's. And I can't remember the exact cutoff but once you're past a certain timeframe and you're collecting unemployment or you're collecting government assistance, you're no longer counted as unemployed.

That doesn't even make sense.

Well, let's not talk about logic, you know, because when we really look at what's going on when we're preparing, I mean literally our annuities are the bomb shelter for retirement.

I'm telling you in a lot of ways it is.

And so you have, you know, you can do one of two ways, you know, if you. And it's funny because I used to watch those doomsday prepper shows and I am not one of those people. I mean, could we have an emp?

Yes.

Could we have a nuclear war? Yes. Could we have a comet hit the earth? Yes. Could we have someone poison the entire water supply in the entire United States? Yes. But if you ever live like that, you're never enjoying life, bad things are going to happen. But you have this prepper that goes down into the ground. They have this beautiful shelter and everything. But the gardens all up, up on the top. So this nuclear bomb goes in, wipes out their entire garden. You're dead. You're dead. Yeah, you're dead. Or you can actually have the, the bomb shelter or whatever and then you have your little UV lights blow, whatever. I don't know how you can control it because.

A nuclear bomb went off. Okay. And that's probably going to get rid of the sun to a certain de. You know, as far as pretty well. So what are you going to do? I don't know. But the point is it has. You have a higher likelihood if you have the food source down with you. Let's say you supplied 100 years worth of food down below. That means you have a good chance of survival. And these annuities, that's your own self sustained, your self reliant income source. And it's, it's in. Somebody says, well what if the insurance companies went under? I still, nobody's been able to find this information. A fixed indexed annuity company. I personally have not found one that's defaulted or not paid for clients in the past hundred years. And I'd say 100 years because I haven't looked beyond that.

Right. And I can't quote where I heard this or where I read this. So take it as hearsay. But.

Which is a lot of the stuff I take that you say.

But, but according to what I understand from the housing crisis. 07080809 or you could say 2007 to 2009.

But okay, yes, there you go.

There were more and just say it. Okay. Banks that went under.

Yeah.

Then there were insurance companies that went into receivership.

Oh absolutely. 500. I know it's over 580 banks that disappeared 2007 to 2009.

Right. You got to be careful about how you use that.

No, you don't want to be able.

To, you know, start thinking that banks are somehow an unsafe place when they're.

Insured by the fdic, which is an insurance company. I mean, just don't. You should never ever have to use fear to present or sell an annuity. Whether, well, you better not put money in a bank, they're not stable and blah blah or you better not. I mean you don't present your facts of safety and security. Let them what's important to them.

Well, I have some other statistics.

Well, let's go.

Pretty encouraging for those of us in the annuity world. And these are from Limra. So to give Limra credit for this.

And what is Limra?

For those who don't know, 254.8 billion in annuity sales, fixed in or fixed annuity sales in 2021, up 16% from 2020. Okay, this represents the highest annual annuity sales since 2008 and the third highest sales recorded in history, according to preliminary results from the Secure Retirement Institute. And then here's another fun one from Limra. So that was 2021, up 16% from the year prior, third highest in history. Total fixed annuity sales were 35.2 billion, up 14% for 2022. The first quarter of 2022, from quarter one of 2021. So what that's saying is that 2021 was the third highest annual sales volume of fixed annuities in history, the most recent highest from 2008. And here we are in 2022, in quarter one of 2022 was up 14% from 2021's quarter one.

Yeah. Which I would be curious what my quarter wine was compared to last year. Well, of course. Yeah. Well, I'm sure.

Got your trackers right here.

Handy dandy notebook there.

Okay, so Q1 of 2021, you did. Let's see.

Let me do.

Do some.

Man, this guy is a master on Excel.

I'm literally just punching in some quick, some quick calculations. Crazy.

He's doing su. Yeah, the sum. I don't get all this stuff.

Okay, so Q1, 2021, you did 5.98 million, sold. Q1, 2022, 11.8.

That's a hundred percent gain. Wow.

Now, industry wide, it was up 14%.

And I'm up 100.

And you're up 100%. Which again, you want to talk about the effect of process? Yeah, it's a compounding effect. It is, you know, 14% across the board. Meaning if you're just producing annuities, period, regardless of how good you are or how much work you need, you should have experienced approximately a 14% increase just doing nothing different. You improve your process, market changes, which makes it a better environment for annuity sales and you have a better process. That's a compounding impact.

Yeah, that's true. Because I've seen this before, you know, I remember 2007 to 2009. Yeah, and I remember, you know, I mean, I think, I think it was 2004 is when I officially got into the retirement life insurance business. And man, it talked about baptism by fire. I get in there and then 2007, 2009 hit. And it's. It's learn quick, but it Been. It was the time from 2004 to 2007 where I was studying like crazy, that helped me thrive in 2007-2009. So same. Which was funny because my thriving there was still minuscule.

Yeah.

I mean, I think in probably eight weeks, I wrote more. And let's see. So 2008, I probably wrote more. I don't think we go back that far, do we? Yeah, I don't think we go back all, but I know we have that somewhere.

Yeah, we do go back. Not all the way to 2010. 2008, you sold 5.8.

Well, there you go.

Nine million.

Literally six weeks, I sold my entire year's volume for 2008.

Right.

And then 2009, I did 9.2, and then 2010, I did over 15. 15.4. So you can see, actually, that's interesting, because you can show 2007 the top. I did 1.4. 1.5 million. Yeah. Then 2008, 5.9. 2010, 9.3. Excuse me. 2009. 9.3. 2010, 15 point. Talk about compounding just increasing.

Just.

Just in that short time frame.

Yeah.

So what's going to happen 2022-2000?

I don't know. I mean, look, you had the last three years in a row in a. In a pandemic environment. Okay. Over 26 million a year. Three years in a row.

Yeah.

This year, you should blow that 26 out of the water by probably another 5 million or so. At least, I would think, depending on how much time you take off between now and the end.

So you're saying I'm gonna only end up at 31 million for the year, and I'm already at 17.4.

I'm saying.

Okay, you know, man, you know what? You are fired as a motivational speaker. You're done. No more motivational speaking for you.

Hey, here's a motivational thing. 2007, Chad wrote 1.47 million for the year, one of his first years in the business. So if you're at that million mark or one point, there is hope.

And apparently for the rest of the year, I'm only going to write $5 million. What I'm averaging. No, you know, it'd be 14.

You'd be writing another, like, 14 million between now and the end of the year.

We're not even at. So we're not in June yet. So the end of June, I should have double. If I just doubled my production right now, that would be 34, 30. Almost 35 million. Yeah.

I hope that happened. Aren't you taking off like all of August?

That is true. I'll be gone for four weeks in August. That's true. And I may take off the last two weeks of June. I don't know.

So. Yeah, but all that to say we are in a phenomenal time like we used to. I mean, we've been saying for three years now, oh, we're in the golden age of annuities. We're in the golden age. And that was when the market was doing crazy things.

Now we're, now we're in the lead years of the stock market and the golden age of annuities.

It's a good time to be doing what we're doing.

Okay, well, I hope this helps you guys. And of course we like to have fun, but we also like to put the, the hard hitting facts in there. And that's what this is about. These are just statistic. And you apply this information to your clients. You give them information and let them put the emotions to it. You do not try and freak them out. You know, go, oh my gosh, read all these statistics. We're all gonna die. You know, you don't just don't do that. Yeah, it present information. Let them provide their emotions to and how it's important to them or not.

Yeah.

But I hope this helps you. You have a great day and of course happy selling.