Selling to the Right Age Demographic | 7 Figure Annuity Sales Podcast | Ep. 131
This podcast episode (hosted by Chad Owen) examines which age demographics are appropriate candidates for fixed indexed annuities and practical issues agents face. Key points: inherited IRAs are treated cautiously post-CARES-act and Chad generally avoids placing inherited IRAs into annuities; recommended client age ranges for annuity suitability center around 50–80, with a "sweet spot" roughly 60–75 (often cited as 55–65 or 60–75); Chad typically won't meet with clients under 50 for annuity sales and generally avoids writing new annuities for clients over 85. The episode emphasizes purpose-driven recommendations, agent ethics, and product suitability rather than chasing commissions.
Questions this video answers
50–80 years old
Approximately 60–75 years old (also referenced 55–65 as a desirable range)
Under 50 years old (he generally won't meet with someone under 50)
Over 85 years old (he generally does not write annuities for those over 85)
He wrote one for himself at age 43
Chapters
Hey, everyone, this is Chad Owen with seven figure annuity sales. Welcome, welcome, welcome. I was trying to talk like him. The welcome. I can't quite do that hick accent. It's like, excuse me, Southern Texas. I don't want to offend any of our Alabama folk either, so I love it. My favorite draw is one of them Tennessee draws, and I can't do that either. But anyway, welcome to this week's podcast and I'm telling you, I'm, I am pumped up. It is amazing when I get away and I actually am able to rest and relax. You guys may not know this, but I've actually had nonstop meetings from the beginning of the day till now and I still feel super energized. And when you're in this business, you always want to make that time to get away. I can't stress that to you enough because it's a way to recharge, regroup, build relationships. And that's just what we're all about. So. And if you are in good standing, in good relationships, you probably had a pretty good Valentine's Day. Oh yeah. But anyway, next, let's move on. What are we talking about today?
Yeah, well, we're going to talk today about age and annuities. And when I say age, we're going to talk about clients age, we're going to talk about young people buying annuities. Not a fine wine like that. Yeah, not, not that kind of age. Although maybe on another podcast on another day.
Definitely not.
But age and clients. And one of the things that I've been coming across lately is agents talking about they're coming across young people who are inheriting an IRA or some type of retirement account and they're curious about what do I do with this? At what point would a fixed indexed annuity actually be beneficial to this client, etc.
Okay, so when you're talking about age, you always have to throw in what type of money is coming in.
Right?
Because non qualified money, that's easy. But you always specify. So let's say you have a 30 year old inherit in money, even when it goes into annuity, you cannot touch it till 59 and a half, it's tax deferred. Now if you have a 10 year annuity, you're 30 years old, 40 years old, it comes up that annuities due. Well then you can do a 1035 exchange and you can just continue let it roll. Now, inherited IRA because of the good old cares act and the thing rules have changed there, I personally will not put someone in an inherited IRA into an annuity. I know there are some products out there that will allow you to do 10% of the original premium put in, but you can take the 10% of the original premium you put in, but you. What if it gains? So can you take 10% of the count value? I think it can become very complicated very quick. And, and compared the amount of business I get inherited IRAs, it's not, I don't know. I do suspect we are going to be running into that more because the baby boomer generation is getting older. So yeah, I could see that being more of an issue or more of a potential problem we run into. But that being said, yeah, I'll, I'll absolutely put younger people into annuities, but depends on the type of funds.
Yeah, absolutely. So for you specifically, an inherited IRA is not going to go into an annuity. There are agents that do that. I've worked with agents that have talked about doing that.
I won't say, I won't. It's gotta be really good circumstances.
Sure, sure. Somebody that knows what they're doing, know what they're getting into with that.
And I know what I'm doing.
Well, I'm saying the client. Well, and that's the, and that's the way you work with everybody. Right. You don't, you don't ever encourage it. Until they understand what's going on, I chase the sale. Right.
What's the purpose of everything? So, yeah, inherited IRAs are a little touchy right now. I do suspect insurance companies because the amount we're going to be seeing that happening, I do suspect insurance companies coming up with some pretty good products that will allow that maybe allowing you to pull 10% out. But whatever values left at the end of the 10 years, I don't know, that's, that's going to be a tough one. Or maybe they could do.
I guess it could take a 10 year annuity, potentially convert every year it's built into the annuity where they can convert that they pay the tax. I'm not sure how that would work. That might be a good question because I do help insurance companies. I get reached out to about product design. So maybe I'll reach out to some of those companies and just see what they have in mind for that. That's interesting because that will happen more. Yeah.
Now especially as we talk about the baby boomers and these were people that have been over the past however many years, really, really great clients for annuity products. They've been great, great fits for annuities by and large, that demographic, that demographic is obviously aging. And there's going to be some people that are going to be inheriting already IRAs that are already annuated.
Here's what usually happens. You know, dad would have really wanted me have that new Corvette, you know, I mean, I know I can hear him from his grave saying, you know, buy the latest video game equipment.
I know what you mean.
Yeah. It's very rarely do inheritances last.
Sure.
I mean, that's just what I found over the years. It's not common. Now. I've had some really good clients that have had big inheritances and they, they're. And they had nothing before.
Right.
And one of the thought processes was, man, this is my second shot at retirement.
Right.
But what I find funny is when somebody inherits a inheritance and all sudden they become stock market experts. Oh, really? If you're that good, how come you have no retirement right now?
Right.
How come you have no savings right now?
How come the first time you're getting in is with your inheritance?
Yeah, I've seen people do that. But it will be something that will happen more.
Yeah, absolutely. So that brings up the question, what's the sweet spot for an Fiat?
Oh, definitely 50 to 79, 80. I'd say 50 to 80. Now the sweet sweet spot to me is 60 to 75.
Sure.
That's kind of the magical spot for me. But when you're talking what's a very good age to put someone in? I generally won't even meet with someone under the age of 50.
Right.
Because delayed gratification is not a phrase in the younger generation. They don't understand that you touch this money. I mean, look at how many home equity loans have come out. Why they think the equity in their home is a checking account or a savings account. And so they don't. They end up never. I mean, I have clients that I've heard in the 40s or people I've talked to in the 40s that, well, I'm never going to pay my home off anyway, so I'm just going to take the equity out. And that's horrible. You know, debt free is the way to be when you're retiring. I'm going to coin that phrase. Debt free.
Debt free is the way to be when you're a retiree.
Brought to you by Chatto.
I just added the third run.
What's that?
No debt freeze. The way to be when you're a retiree.
Yeah, that's horrible. Let's go.
Feel free to use it. Since Chad doesn't want to you can.
You, you turn it into Southern jingle, then we might do that. Don't do it right now. Please don't do it right.
Okay, I won't do it now. But no, that's good. And so, so you're saying 50 to 80 generally, but really that sweet spot, 55, 65, that range. I really love to see it as somebody that gets to help agents. I love to see when the client can defer for a decent amount of time before if they're needing income, if income is the concern before they turn that on.
Yeah, I mean that's ideal, but that's not. I keep thinking my son, my favorite son in law could actually sing that jingle in a Johnny Cash voice.
He sure could. And it's not this one either.
But anyway, it's, it's, you know, to me, retirement and annuities always come into. When do you not want to have market volatility?
Right.
And everything revolves around that. Well, should I do an annuity now? Well, when do you want to get out of market volatility?
Sure.
You know. Well, I'm too old for an annuity. Well, you're too old to protect money. I'm too young for an annuity or you're too young to protect money.
Right.
So everything I'm telling you, everything I do is driven around the purpose of safety and security. Absolutely not age. Now, there are products, and we all know this, there's products that are way better. Like if you're under 50 years old, there's not a lot of really good income rider products out there. Right. There really aren't. And someone that's 47 years old, I'm looking for that. I'm really trying to find someone now. Do I want income writers? Absolutely. I'm all about investing in all sorts of things, you know. But if brings up an interesting point of how many agents sell annuities but don't own their selves. I mean, my number one product I use right now own that.
Right.
In the same exact index strategy.
And you can then tell clients, I own this annuity.
I made more off of my annuity than I have ever. I've made more having my own annuity than I have in my annuity.
Sure.
And it's just because I do believe in what I do and I'm 47. So. Yeah. It's funny though, because I have met with 45 year olds that, well, I don't want to tie up that money. You can't touch it till 59 and a half anyway.
Right.
So yeah, it's always purpose driven.
Absolutely. Always figuring out what is the purpose of the money and then figuring out from there what's going to be the best for their situation, not what company has the best agent incentives, not what company's paying out the highest commission, what is going to be best for their situation. And really, as an agent, I would encourage every agent listening to this, work with your marketing organization and see what are they recommending in general cases and situations. But do your own research and due diligence as well to really make sure. Because I know there are times when sometimes marketing organizations will, you know, try to push for their own bottom line, you know, and there's some product pushing that can be going on there. So it's really having the client's best interest at heart. And I have no doubt that our listeners do. But it's always good to reiterate. Sure, absolutely. Well, that's a great, that's a great start to a really great episode actually.
That's it.
Well, that's, that's all I've got for today.
That's interesting. I thought it was going to be more life changing. Totally joking if you can. I'll tell you, tapping into younger clients, that is. I do see some agents doing that lately and they've done very well at it. But I, the one of the reasons I actually went to business on my own, right, was because the guy that was teaching me how to sell annuities was putting college students into them, telling them that they could use those annuities to pay for college. I'm like, now you can.
Just listening. My eyes just got huge. You didn't hear anything.
But, but I was like, if this guy is misrepresenting this way, it is, it just blew me away. And this product had big surrender charges.
Right.
And I remember telling him, you know, hey, you can't do that. He's like, well, hey, they got 10% bonus. So a 10% surrender, 10% penalty means nothing. I said it does too. Because the reality is you're misrepresenting the product. But if you do it right, honestly, it can be a good market to tap into. I also, let's balance out to. I don't usually write annuities for anybody over the age of 85 as well.
Right.
So that's just something we want to make sure. It's funny, we got our technical difficulties behind us. It's okay though. I can see through the window. I love this because we are live and this is what we do. But over the age of 85, I'm generally not going to write annuity for. Why? Because that's, I mean, you put anybody in brand new annuity, 85 years old, you have surrender charges. That's just something I don't do as well.
Yeah, absolutely. I've got one more thing.
Sure.
If you're using leads and somebody is 35, 40, 45 years old, and they're reaching out to get information about these products.
More than likely that individual is considering delayed gratification, like you would say. Right.
You would think.
Have you come across. You've come across very, very different.
Yes.
People with the mindset that it's going to be the next gold mine for them or something.
I think the youngest person I've ever written an annuity for is me.
Really?
Yes. When I was 43 years old.
Wow.
Yeah, I just, I don't know, I might have maybe a 40 year old at one time because I remember one of the products at one time they had a 20 year income guarantee and they were retiring at 60. So I think I do remember that, but it's not common.
Well, I'll say as a young person, I wish young people understood the way that they can benefit them, but then actually had that mindset of delayed gratification.
I have an annuity sale right here.
Soon as it gets money, sell me my own.
That's true. You are. No, you're not licensed yet. You will be. You are. Wow. Congratulations.
Thank you.
First moment of encouragement. Live well. I hope this helps you guys. You have a great day and once again, be very specific on who you help with annuities and make sure the product suits what they want to do. Have a great day.
