When and When Not to Help a Client | 7 Figure Annuity Sales Podcast | Ep. 116

Hello, everyone. This is Chad Owen, the annuity sales coach, owner of Retirement Realize Financial and Retirement Realize Agents Academy. Welcome to today's podcast and today we are talking about. Oh, wait, I need to introduce you. This is Caleb. That's it. Okay. This is actually my sidekick. He's my shotgun driver. Even though the only thing he can actually hit with is a shotgun.

Oh, that's good. But I am on the left, so technically I would be the driver.

Nope, we're not in your country. We're in my country. We drive on the right side of the road. On the right side of the car. I'm now in the passenger seat with a steering wheel. I'm not sure what's going on. I have no idea. This is what happens when we have Tweedledee right over here. So I'm gonna. Later, Tweedle. Oh, man. Okay.

Back to today's message. We're gonna talk. So what we're gonna cover today is when to help a client and when not to. That's good because it's, you know what I'm going to say, it's good.

It's going to be good.

Prophesying. Okay, Prophet lying. That's what you're doing. Okay. But no, it is going to be good. Anyway, back to. Holy cow. Okay, so, you know, this is the first time we've ever had this much rabbit trails because of people over here. But when to help a client, when not to help a client. And it's important we establish that because every, every time, ever in the 16 plus years I've done this, I've made an exception, I've been burnt. And so mine flat out is you have to have 50,000 emergency funds and 50,000 in investable amounts. Why? Generally, and this is a very general, broad statement, but if somebody doesn't have that by the time they're 60 or 65, generally they don't understand the concept of savings. They don't understand the concept of budgeting. Now, I've ran into some horrific circumstances where somebody has a medical condition that came up or something, illness happened or situation out of control. I get that. And that's not what I'm talking about. What I'm talking about is the people who literally their entire life have overspent or not budgeted their money and now they're 50, 60, 70 years old, trying to retire and they don't have emergency funds and saving because they chose to go crazy on what they have. You know, I remember when we were first married.

Yeah, don't look at me when you.

Say that my wife and I were first married. I mean, we had no car for the first three months, I think. And we had one car for six years. I think it was, let's see, we had maybe four years, this four years. But we went a long time with one car. Now people get married. I need to have a house. I need to have two cars. I need to have this. I used to ride a bicycle to work. I mean, I used to be in a full suit.

I used to be in a full suit in Las Vegas in the summer, catching the bus to work. Now that's not comfortable. But I know beyond any shadow of a doubt that what we had then we just stuck to what we. I mean, we didn't have it really have credit cards because we just weren't established. We didn't have established credit. So it's important to know that what are you dealing with? And every time I went under the 50,000, anytime any of my issues have always been with clients that have less than that. And it's just like talking to someone under the age of 40. Most the time, someone under 40 doesn't understand the concept of retirement. They're not even thinking that way. So if you try and tell, hey, you know what, you're gonna retire in 25 years, they're not thinking, right. Retirement. I mean, 50% of people that call on my radio show, I can't even help because they don't have enough in emergency funds or savings or they have nothing. I think it is. I think it's over 52 or 53%. I just saw this from one of the retirement publications. Have no retirement savings whatsoever. None. They have no pensions. They have just Social Security. Whenever Social. Social Security comes out. Now, once again, we're in Texas as Teachers Retirement System. So it's a teacher pension. And there's a lot of teachers out there that have actually done pretty well. They have a great pension. They just don't have an actual physical retirement, but they have a pension. That's great. There's city workers, there's government workers, there's police officers. You know, they've got this pension that they've been building. We have two, two or three really big military bases here. And some of these guys don't put into their TSP that much, but they have huge pensions. That's fine. But when you don't have a pension, you're relying only on Social Security. That's not someone that you're going to put into an annuity. So you are. It's easy to say, hey, I can't help you in this situation. Another person I'd look at is, you know, someone that just flat out is so arrogant, they think they can beat the market. I mean, nobody knows when the top of the market is. Nobody knows when the bottom of the market is. So what makes you think you're going to beat the market? Sure, right. I mean, I remember talking to a client one time, and he goes, yeah, you know, I could time the market and I can do this. I said, huh? So why are we only dealing with $100,000 then? Why aren't we dealing with 20 or 30 million? Because if you know the top of the market and the bottom of the market, you know when to get in, when to get out, then why are we dealing with more? So that's another type of client that I would say, you know what? I just. I'm not gonna force someone to do something with their money. It's their decision.

Right.

You know what I mean?

100%.

I mean, I'm sure you've heard of cases because you helped so many agents, but where they're trying to squeeze a deal out of something that doesn't exist.

Right.

Well, can you run me an illustration for that? For What? They got $10,000 total, so you can put 5,000. Well, most annuities nowadays, they don't go under 10,000. So, I mean, don't be so desperate for a sale that you're willing to do something that doesn't make sense for anybody. I'm gonna put $20,000 in income rider, and they're gonna activate it in two years. Okay. So you're gonna collect your $25 a month, and what's it gonna do? And then you hurt their emergency funds and savings. True. So I remember we were talking before this. You're like, you know, who do you help? Who do you not? What was something you kind of had in mind?

Yeah, well, going back to that 50,000, really. I know you say that's really kind of your sweet spot. If they don't have that, it makes it really, really challenging a lot of times. But the way I think about that minimum that $50,000 in emergency funds and savings is, it does two things. There's twofold. One, it obviously keeps enough liquid for the client that if they need to draw on it, they can pretty much cover whatever they need to get cover. But two, it also helps ensure that whatever product you decide to put them in makes it through suitability.

Yeah, absolutely. And honestly, suitability should be the last thing on your mind from the standpoint of you never want to just barely get by suitability to get the sale. You want to make sure there's more than enough there. You want to make sure that they have enough income to cover any expenses and then some in the future. Because if you're retiring 65 years old, the married couple, I think the statistic right now is if you are 65 years or over married as a couple, you have a 50% chance of living over age 95. Now, the average life expectancy, what I understand is right now, because there's different publications that say this, but the average life expectancy for a male is about 79. For a female about. It's about 84. If you're married, you add six years on top of that. And I didn't even say happily married. I mean, it's, you know, it's just one of those things that it just. When you're together, there's a higher life expectancy table. I mean, it's. I'm surprised I've actually lived as long as I have those.

Like we credit it to.

Absolutely. My wife does it. She's. Oh, there's. That's an example. She's kept me alive a lot longer than I ever expected. I'm going to live to 100. We are going to hit 75th wedding anniversary guaranteed. That's the goal. But, you know, you have to realize what's best for the client, what's not. I even run into people where the one spouse is absolutely for it and the other spouse is absolutely that one stuff. What?

You hate that situation?

Because I went to one House man, and they had an extreme. She was an extreme left liberal. He was an extreme right Republican conservative. And I'm going, how does that work? She was so far to the left, she would not buy an annuity from me because I had a red truck.

And he's over there.

I love that truck. And he had, let's see, when was this back. Who was president back then? He had Bush stickers all over the place. And I said, oh, yeah, I like your stickers on your car. And she goes, don't talk to me. You don't need to bother coming in. This is a married couple. But, you know, the reality is, if someone's extreme, I want to risk all the money. And the other one's like, I want to protect every little bit of it. It's so hard to work with that client now. If they have separate money, that's fine. You move your 401k, you keep yours where it Is. That's fine. But, man, when you have combined funds, that's another one that I. I often will bow out of that situation because I know when I leave, it's gonna be World War Three. I mean, could I get the deal done? Absolutely. Because I will side with a conservative person all day long because I know no matter what, they're gonna have safety and security, that they're never gonna outlive their income, that even if the market falls, they're not going backwards. But the other person is like, man, I can pull that slot machine arm and I can risk it. That's a tough one, too. So.

And you've run into it the other way around where. And this is. You've said, really a tough situation where the woman is, like, I mean, just all but begging for this product because she realizes the safety and security. And. And the. The man, the husband is just, like, adamant that he's gonna stay in the market, keep risking, and keep trying to capitalize on. On some gains.

I. Man, that one is so fresh in my mind. And that was probably five or six years ago.

That one's here there.

Because she was like, baby, help me, baby. And I'm, like, going, I can't. And she goes, come on, baby, help me. I need help. My husband wants to risk all the money. This guy's a big dude right next to me, and he's like, no, I'm doing this. I do that. And she goes, help me. And I said, I can't. She goes, why? He said, because of that. And I pointed right to him. I said, he doesn't care about your safety. He doesn't care about your security. He. He wants to gamble his money away. That's up to him. I'm not married to him. But the reality is, I mean, I went off on him because he was just being a jerk. I mean, literally, this woman had no say in their financial situation, yet he's put up with him for 30 years. She should be being paid at second by the second to take care of that guy. But, you know, the reality is I just finally, I couldn't because he would not. Absolutely refused to do anything. But the funny thing is, it's about three months later, he called me because I said, hey, I'm not moving your money right now, but I'll help you come up with a budget, and I'll help you. Like, I don't care if you would have said right there, I'll move your money. Because he was way over expending. But I said, hey, I'll help you with the budget. He called me three months later and. And asked help with the budget. And I helped him with the budget. And he said, well, can you move our money? I said, no. I said, until you stop your spending, there's no way. Because what he probably would have done, What I felt he would have done, is I could have got him in the annuity, but then he would have surrendered money to get the money out. He was compulsive in his buying, using discernment on that. Yeah. I knew he would be surrendering the policy and taking money out. So not only would they end up not having the retirement, they'd have to pay surrender penalties. So I just. I walked out of that. I remember one time, another one where this guy had $20 million. Okay? He was 70, she was 45. Kind of getting the picture there, aren't you? He's a winner. Five kids under the age of 18. And so he wanted some money. Like, he's saying, I got to have $2 million a year to live off of. I said, sir, that is not gonna work. There's no way off of 20 million. We're getting you $2 million a year to live off of. He's like, well, that's what I want. I said, sir, you are setting your wife up for failure. And he reaches over, puts his hand on my arm, and he goes, I don't really care what happens when I'm gone. I said, that's it. Zipped up my bag, that. And he said, what are you doing? I said, I'm not helping you. You're a jerk. And I literally said that to him. And he goes, nobody's ever told me they're not helping. I said, I'll be your first. I'm not helping you. And I walked out, and this guy literally followed me out of his own house, ticked off that I wouldn't help him. Hey, I don't care if you got 100,000 or you got 20 million. You don't care about your family situation. I'm not helping you. I'm not letting you be a loser to your family. So that's where the commission means nothing to you at all.

That's good. Those are some really, really good examples. And it goes to show, even on that kind of middle example there, where the woman really, really wanted to, you know, get some help in this, and the guy really didn't. It just goes to show how when your heart is to help, your heart is to benefit them, you can throw other things out on the table that eventually they come back around. And again, even when they came back around, it didn't necessarily translate to any anything. But if the deal hadn't happened the first time, but they were qualified for it and they were a good fit for it and you wanted to work with them, you throw out that help, maybe later they come back around and you're able to help them.

And I did tell them, they said in a year, if you've got your budget established and everything's fine, then we can do that. And I would have, I would have helped them, but I would have definitely need to know that the budget was established and it's fine. And they were actually sticking to it because man, when he was pulling out, let's see, so he had 500,000, he was pulling out 100,000 a year. He used to have a million and he got laid off four years ago. So I mean, he was burning through money. And I think he was only 60 years old, he was young. So I have no idea what happened in that situation. But man, never ever focus on the sale. Never ever focus on the commission. Always do you have a solution to the problem. Always be willing to walk away from something that isn't right. Not only does it burn your client, it's just there's no amount of money that's worth jeopardizing ethics and integrity. Right?

That's so good. That's so good. That's what it's all about. And that's the only way to rewrite the narrative. And kind of this reputation that precedes this industry, that this black eye, is if agents really do a good job of riding their business with ethics and integrity and choosing to take the high road every time.

And I still see it all the time. I see, you know, I have someone that I would go help and they say they have an annuity. And I look at the annuity they got put in and I'm going, there's one that had a very large bonus. But the index strategy stumped. And so this person actually went to one of these award conferences and he sold a ton of this particular product. And I looked at him and said, oh, what you doing here? You know, So I made this number in this other company that, you know, I didn't use, but it was part of a marketing organization. I said, do you realize how messed up the index strategies are on that policy? I don't care. They got a large bonus up front.

So literally the person can go 14 years later at a 14 year surrender schedule to it. This is way back in the day they don't even have these anymore. But, man, I can't even imagine how messed up that person's situation is. Fourteen years later, they're going to be in the same situation they were because some guy pushed a bonus product that they literally should have walked away from. So, once again, just know who you should help. Know who you shouldn't. Don't be afraid to walk away from a deal. It's not your money, it's their money. So I hope this helps you guys. You have a great day and happy selling.