Given the low rate environment, Annuity is a great and much better alternative than many other safe products.
https://money.usnews.com/investing/investing-101/articles/things-you-need-to-know-now-about-annuities
This USNews.com article has a great list of 16 Annuity related questions and more importantly, answers!
Given the low rate environment, Annuity is a great and much better alternative than many other safe products. https://money.usnews.com/investing/investing-101/articles/things-you-need-to-know-now-about-annuities
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Many costs are increasing for retirees. These eleven items have increased more than 100 percent and two more than 200 percent since the year 2000.
The eleven items are:
The last two increased by 226 percent and 272 percent. Retirees’ Social Security checks have not increased anywhere near 100 percent since the year 2000. What does that mean? Retirees are losing purchasing power. Inflation is causing a reduction in the standard of living of America’s retirees. Shouldn’t we plan for this lost purchasing power? Age 30-40
1. Think About Protection 2. Think About Growth and Accumulation 3. Think About Tax Deferral 4. Think About Tax Free Growth Age 40-50 1. Think About Guaranteed Retirement Income 2. Think About Retirement Savings 3. Think About Tax Reduction or Elimination 4. Think About Increased Quality of Life Age 60-70 1. Think About Reduction or Elimination of Tax 2. Think About Inflation 3. Think About Income That Cannot Be Outlived 4. Think About Legacy Below is from "Van Mueller on Cash Value Insurance". A highly educational and fun piece to read about cash value insurance.
=========================================== What would you say if I told you the life insurance industry is the world’s safest industry? What if I shared that the life insurance industry can provide a strategy that yields 20 to 30 times the safe money yield of a CD or a savings account? What if this strategy had guaranteed return in most cases with no downside danger, only upside opportunity? What if I told you this wonderful strategy would never have to be reported to the Internal Revenue Service or reported on a FAFSA? What if this strategy allowed its values to be accessed at any time without penalty and have always been available during serious economic downturns? What would you say if I told you that you could use the values in retirement to provide a 100 percent income tax free supplement to your retirement that you couldn’t outlive? What would you say if I told you that you could use the values in retirement to provide a 100 percent income tax free supplement to your retirement that you couldn’t outlive? Would you want benefits like those listed above for yourself and do you believe that your prospects, clients and customers would be especially interested in benefits like these for themselves? Didn’t I just describe a cash value life insurance policy? What do most people believe you have to do to collect on life insurance? Isn’t it that they must die? Isn’t it true that there are very few people who are aware of the spectacular LIVING benefits of a cash value life insurance policy? Isn’t that why we call it life insurance? Have we ever paid any benefits to a dead person? Of course not. The benefits are available to take care of the people we love and the businesses we’ve created and the charities we have considerations for. Then I lean in and I explain that I don’t want my customer to die. What if I could show you all the living benefits of a cash value life insurance policy? Would that help to clarify why so many leaders and financially well-off people own enormous amounts of cash value life insurance? I then ask, “Do you know almost no one knows how wonderful these plans are?” Do you know why? It’s because government places tight restrictions on the advertising of these accounts even though they are 100 percent legal. Why does the government and the Internal Revenue Service wish to keep these accounts a secret? We will talk about that later. Who Uses These Accounts?
Please remember this important information. Life Insurance Is Easy, Accessible And Liquid. Approximately 3800 banks own more than $190 billion in cash value life insurance.
According to the Federal Deposit Insurance Corporation (FDIC), the largest 38 banks in America have invested over $140 billion in cash value life insurance, Sixty-eight percent of these banks have more money in cash value life insurance than they have invested in skyscrapers, IT networks, and bank branches. WHY DO BANKS BUY SO MUCH CASH VALUE LIFE INSURANCE? Banks are required by regulators to keep large amounts of cash on hand to meet unexpected obligations. This cash cushion must be unassailable. Banks must be able to access this cash immediately. They cannot put this money at risk. Regulators call this TIER ONE CAPITAL. By law, banks must keep four percent of assets in Tier One Capital. Using cash value life insurance was so attractive, the Federal Reserve had to make a rule to limit how much cash value life insurance banks could buy. Currently banks are only allowed to keep a maximum of 25 percent of their Tier One Capital in cash value life insurance. Banks buy ALL they are allowed to buy. Please consider this information if you think or believe an economic disaster is coming. 9000 banks went bankrupt in the Great Depression. Less than 2 percent of life insurance assets were impaired. In 2007 and 2008, 450 banks went bankrupt and less than 1 percent of the life insurance companies assets were impaired. The Wall Street Journal says a cash value life insurance account has become a tax shelter for the rich. It gives the affluent tax advantages far beyond those available to middle income people through a 401(k) and IRA. I turn it around and ask another question of my middle and upper middle-class customers. I ask them why they aren’t using the same techniques that are helping the wealthy get and stay wealthy. Wouldn’t that be the most effective way to build financial and retirement success? Ed Slott, who is a hero to the life insurance industry shares an important opinion at every “Master Elite Advisor Training Session,” and every time he is on public television. He starts by sharing that he is a Certified Public Accountant and that he sells nothing. However, he feels it is important to share with everyone that “The Tax Exemption For Life Insurance Is The Single Biggest Benefit In The Tax Code.” Ask your customers why all these people use cash value life insurance if it’s not a valuable piece of a successful financial and retirement future. Do you know why the government restricts the advertising of cash value life insurance? The government places tight regulations and controls on the advertising of these accounts because once your money is in them, the government and the Internal Revenue Service “Can’t Make A Dime Off Of Them!” That raises another question. If the government needs more revenue in the future how much longer do you think cash value life insurance will be allowed to exist in its present form? That raises a final question. Won’t it then be true that the only people allowed to own cash value life insurance, with all its current benefits in the future, will be the ones who owned it before the laws change? Who else has used the benefits of cash value life insurance to enhance their financial life?
These are just a few names. Why aren’t more names known? Because cash value life insurance is private and is outside the purview of government and the public. We do not know the full extent of how much cash value life insurance is being used by individuals, businesses and charities. I will tell you this; cash value life insurance is used extensively by people who understand all the wonderful benefits that are provided by this product. Do you know that you can also verify life insurance safety at the American Council of Life Insurers (ACLI). When you get to the website if you compare assets to liabilities you will discover that the life insurance industry can pay EVERY claim it has and still have a surplus. WOW! That is the kind of reassurance that our prospects and clients need to be made aware of. Ask them if they know and understand how safe cash value life insurance is. The life insurance industry can pay EVERY claim it has and still have a surplus. Ask your prospects and clients how many savings accounts and CD’s the banks own. The answer is ZERO. Then ask if they know how much the banks own of cash value life insurance. Wouldn’t they be amazed to find out that the number is more than $190 billion? The above information should easily prove that this is the greatest time ever to sell cash value life insurance. If you sell cash value life insurance for the first time in the history of the business, you are the competition. No one can touch you. You have a product that allows one dollar to do the work of many dollars. My dollar takes care of you if you live too long. My dollar takes care of your family, business or charity if you die too soon. My dollar is self-completing if you become totally disabled and have waiver of premium on your contract. My dollar has a critical illness benefit. You can access the funds if you have a critical illness like a heart attack, stroke or cancer and when you die, the death benefit will replace the money you used during your critical illness. If you don’t need critical illness benefits you haven’t wasted one cent on the coverage. Cash value life insurance has a terminal illness benefit. If you become terminally ill, you can access most of the death benefit of your cash value life insurance so you can help develop a plan to look after your family, business or charity before you die. My cash value life insurance will also provide long term care benefits that can be used anywhere. When you die, the death benefit replenishes the money so there is money to care for the person who cared for you. The best part is that if you don’t need long term care, you haven’t wasted any premiums if you never need the benefit. Finally, the ultimate goal is to provide a tax-free income stream in retirement to supplement your retirement income. What’s ever left will be paid to your family, business or charity free of income taxes. Cash value life insurance is also pennies that buy dollars. If you could buy a dollar for 3 to 10 cents per year wouldn’t that be amazing? These benefits are the spectacular wonder of cash value life insurance. Economics research on retirement optimization has long shown that a lifetime immediate annuity can improve the efficiency of retirement income... yet in practice, the great "Annuity Puzzle" is that consumers still rarely purchase them (and fiduciary advisors often oppose them).
Here are some valid reasons to not use an annuity:
At the same time, here are some invalid reasons not to use an annuity:
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