How Much of Your Nest Egg Would You Like Guaranteed?

You may have heard me ask this question, “How much of your nest egg would you like guaranteed?” The answer almost always is “100%”.

Annuities offer very strong guarantees. The reason why some clients don’t have at least some of their nest egg in annuities is because they think that annuities have high costs, low liquidity, low earnings potential, etc….

We need to help them become more educated on the costs, liquidity, earnings potential, etc… of our annuity products.

Let’s take a look at the earnings potential, since I think this may be one of the main reasons why clients may not be looking to annuities.

I’ve been talking about Opportunity Cost with agents and how the crediting potential of annuities compares to other options. While it is true that products like Fixed Indexed Annuities may be capped on the maximum your client may receive in crediting, you need to remember that annuities should not be compared to equities.

These products are a great safe money alternative. What do you normally consider as a safe money vehicle? When you compare the crediting potential of the annuity to those other safe money vehicles, you can see there really is either no opportunity cost or very little opportunity cost.

Do you think that with no opportunity cost or very little opportunity cost and stronger guarantees, clients may prefer an annuity over other alternatives?

I do.