Retirement Realized Agents Academy https://rragentsacademy.com Annuity Sales Training Tue, 29 Nov 2022 21:20:41 +0000 en-US hourly 1 https://wordpress.org/?v=6.1.1 https://rragentsacademy.com/wp-content/uploads/2020/06/cropped-RRAA-_-EMBLEM-32x32.png Retirement Realized Agents Academy https://rragentsacademy.com 32 32 How to Sell Annuities: The Complete Guide https://rragentsacademy.com/2021/07/23/how-to-sell-annuities/?utm_source=rss&utm_medium=rss&utm_campaign=how-to-sell-annuities https://rragentsacademy.com/2021/07/23/how-to-sell-annuities/#respond Fri, 23 Jul 2021 22:30:47 +0000 https://theannuitysalescoach.com/?p=1065 I hear of agents all the time who are selling life insurance, medicare, final expense, etc., and want to learn how to sell annuities. Then there are those who aren’t even currently in the industry but want to get away from their 9 to 5 jobs and start selling these products. Lastly, there are those…

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I hear of agents all the time who are selling life insurance, medicare, final expense, etc., and want to learn how to sell annuities. Then there are those who aren’t even currently in the industry but want to get away from their 9 to 5 jobs and start selling these products. Lastly, there are those who are already selling annuities, and simply want to increase what they currently produce.

Wherever you find yourself, this blog will provide valuable information and practical next steps for you to take. 

The steps you need to take to sell annuities are as follows: 

  1. Get licensed
  2. Find a Marketing Organization
  3. Become an Expert
    1. Basics of Annuities
    2. Types of Annuities
    3. Specialization
      1. Product and Carrier Knowledge
      2. Only Annuities or Other Lines? 
    4. Retirement Accounts
      1. IRAs
      2. 401(k) and Employer Plans
      3. Pensions
      4. Non-Qualified vs Qualified
    5. Taxes and Annuities
    6. Annuity/Insurance Regulations
      1. State Regulations
      2. National Regulations
    7. Establishing a Sales Process
      1. Mindset
      2. Phone Calls
      3. Fact-Finding
      4. Appointments
      5. Objection Handling
  4. Getting in Front of Clients
    1. Types of Leads
    2. Selecting Lead Companies
  5. Why “Getting in Front of Clients” is Last

How to Sell Annuities

If you’re currently selling products other than annuities, and you’re concerned about stepping into annuity production, take my story as encouragement.

I started in this business as a life insurance agent selling mortgage protection, and final expense insurance.

Then, in 2008 I cross-sold $5.8 Million in annuity premium. Since then, I’ve continually refined my knowledge and my process, but I haven’t looked back.

In 2009, I fully committed to specializing in annuities. In 2020 alone I sold $26.7 Million in personal annuity production.

Step One: Get Licensed

To sell annuities, you must first obtain a life insurance license in each state that you intend to sell annuities. Each state has its own set of laws and regulations around the different products from life insurance companies (which includes annuities), and each state is governed by the National Association of Insurance Commissioners.

Having a life insurance license will allow you to sell annuities that fall under the “fixed” category of annuities. i.e. Fixed Annuities (Multi-Year Guaranteed Annuities), Fixed Indexed Annuities, Immediate Annuities, Deferred Immediate Annuities, Single Premium Immediate Annuities, Fixed Income Annuities. 

Having only a life insurance license in your respective state will NOT allow you to provide financial advisory services for compensation, or to sell variable annuities, securities, mutual funds, or other “risk” products. To offer those services you must obtain the proper securities licenses. 

To become a licensed life insurance agent, and sell annuities, you must go to your state’s Department of Insurance website and follow their guidelines. Here is a Directory of each state’s Department of Insurance. 

Generally, your state will require that you pass an examination proving your knowledge in the life insurance industry and the different products, features, and laws regarding it. Because there is an exam involved in this process, it’s advised to take a pre-licensing course to sharpen your knowledge of the life insurance industry before taking the exam. 

Simply Google “life insurance pre-licensing course” and examine your options. 

The next steps are critically important to selling annuities, but without your license, the next steps wouldn’t have any application to you. 

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Step Two: Find a Marketing Organization

The process of finding a marketing organization (also known as an IMO, FMO, NMO, BGA, MGA, etc.) is very important because you are aligning yourself with a company or individual. 

IMO – Independent Marketing Organization

FMO – Field Marketing Organization

NMO – National Marketing Office

BGA – Brokerage General Agent

MGA – Managing General Agent

The relationship between a Marketing Organization and an Agent should be a partnership. That means that if a marketing organization and an agent work together, they should both become more profitable because of the relationship. It should be mutually beneficial. 

In today’s world of marketing organizations, it can be challenging to find an IMO or FMO that aligns with your beliefs, the ways that you do business, and that has adequate tools and support to make sure that your practice is as successful as possible. 

Because this relationship will drastically affect your business, it’s a decision that you should take seriously. Be methodical, have a set standard of what you want, and don’t chase “shiny objects.”

Some things that you should ask a potential marketing organization follow below: 

“What does example organization specialize in?” 

Reason: If a marketing organization doesn’t have some kind of niche in which they thrive, they’re likely just trying to throw all their agent’s business to the wall to see what sticks.

“How does example organization practically help me produce more?”

Reason: If they can’t accurately articulate the practical ways that they help you produce more business, then you have to wonder if helping you is actually one of their objectives.

“What kind of resources and tools does example organization offer their agents?” 

Reason: Marketing organizations should be providing agents with different resources and tools. Some of these resources and tools include sales training, process training, creative design/branding, plans for leads/marketing, backend support, case design, and ways to track your business, etc.

“How many different carriers do you have?”

Reason: The more carriers a marketing organization has, the less likely they are to push only a few specific carriers/products. Be careful of organizations that push only a handful of products, and don’t take a holistic approach to case design with your clients. 

“Do you help with product selection/case design?” 

Reason: Marketing organizations should be assisting agents with product selection and case design, and they should be able to explain why they recommend a specific product for your clients. Your reputation rides on your expertise, and product recommendations. If you can’t be sure that you’re promoting the best possible option for your client, your reputation can be at risk. Make sure your marketing organization has your best interest and your client’s best interest in mind when recommending a product to you or helping with case design. 

“How am I compensated? From you? Or from the insurance company? What level am I at? Street or higher?” 

Reason: Marketing organizations should not try to control their agents by controlling their comp. They should compete for their agent’s business using their tools, resources, and support. Further, ask about your comp. level. Generally, agents should be started at street level, but sometimes if a marketing organization is providing leads to their agents for free, they’ll give them a lower comp. to cover the cost of leads. 

“Do you have any testimonials about agents who’ve been able to improve their production with you?”

Reason: If they can’t give you an example of other agents who’ve had substantial success with them, that must not be something they’re concerned about, or they don’t work closely enough with their agents to know. 

“Anything else I should know about example organization?” 

Reason: This puts them on the spot, sometimes there will be lots of other good information you want to know, but it allows you to hear from them what they want to communicate most clearly to you. Their motives will often come out after this question. 

“Would I be a captive agent at example organization?”

Reason: If you are wanting to have the freedom to sell what you want to sell, and make sure that what you sell is best for the client, and you want to be able to be a part of other organizations, steer clear of becoming a captive agent. 

If you have specific questions about the IMO/FMO you’re talking to, make sure you ask about those too. This is just a list of the things that we recommend agents inquire about. A Lot of the “heart” of the organization can be easily observed by the answers to these questions. 

Some things that you should be wary of when it comes to marketing organizations follow:

– Captive organizations: Generally, captive agents struggle more than non-captive because they can be limited in many different ways.

– Providing you leads for a piece of your comp: Generally, agents who are good producers that give up comp. for their leads end up paying more than agents who purchase their own leads/marketing from third-party companies. Sometimes this model works, but it can be confining.

– Product pushing: Generally, IMOs/FMOs that push a product or two don’t have your client’s best interest at heart. Your focus needs to be finding a solution to a problem, not pushing a marketing organization’s product that gives them the best override. Be careful with this one.

One thing that’s worth noting is that bigger is not always better. The same is true for marketing organizations. If you value a personal relationship with the people you do business with, then don’t just discuss things with a big organization where you’re one out of several thousand. Talk to the smaller organizations where you’re one out of a few hundred, and develop relationships with that team. 

The best thing you can do is align yourself with an organization that shares the same values that you have. Remember, the relationship between an agent and the IMO/FMO is a partnership. Both should become more profitable by working with the other. 

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Step Three: Become an Expert

Becoming a true expert in the annuity industry is time-consuming, but absolutely necessary. There are 7 areas in which you need to be an expert within the annuity industry before you even consider meeting with a client. 

7 Overarching Areas of Expertise:

Annuity Basics

Types of Annuities

Annuity Specialization

Retirement Accounts

Taxes and Annuities

Annuity/Insurance Regulations

Client First Sales Process

You should have mastery-level knowledge in all of those areas before soliciting an annuity because your clients shouldn’t be considered practice. There are plenty of “sales” industries where you can “practice” your craft with consumers, but the annuity industry isn’t one of them. The magnitude of responsibility that’s assumed by a producing agent is immense, and proper knowledge, training, and mindset should be in place before a sale is ever made. I always say “this affects our client’s retirement far more than it affects ours.” 

That said, in the paragraphs that follow, I’m going to give you tons of information about these 7 overarching areas of expertise, but I strongly recommend you spend ample time researching other places like the NAIC, the IRS, the SSA, Retirement Realized Agents Academy, my other Free Resources, and various insurance companies to see their product offerings. 

Annuity Basics

An annuity is an insurance contract that’s sold by an insurance company. In effect, it’s a financial product that’s purchased either by a lump sum payment (“single premium”), or multiple payments over time (“flexible premium”). There are multiple types of annuities, but the two overarching categories of annuities are “immediate” and “deferred.”

Annuities are commonly used in retirement planning to create an income stream during retirement whether that be through annuitization or an income rider. Annuities are vehicles in which a consumer can in effect create their own type of pension. 

Want to fast-track your understanding of annuities? Watch this video of Chad and Caleb giving “A New Take on Simplifying Annuities.”

Types of Annuities

There are different types of annuities for different types of client situations and risk tolerance. It’s important to know the different types of annuities that you are able to sell based on the licensing that you have, as well as the types of situations that each type is most beneficial. 

Immediate Annuities

An immediate annuity is generally purchased with a single premium (lump sum contribution) for the purpose of generating an immediate income stream. Generally, control of the money in the immediate annuity is completely transferred to the insurance company, because immediate annuities are commonly annuitized immediately. Hence the name. 

Deferred Annuities

A deferred annuity is generally purchased with a single premium (lump sum contribution), however, some products with various insurance companies allow “flexible premium” with a set minimum contribution. Deferred annuities are commonly used for protected accumulation and income generation at a later date. 

Fixed vs. Variable Annuities

Another way that annuities are categorized is by their exposure to market downside risk. For example, there are Fixed, Fixed Indexed, and Variable annuities. Both Fixed and Fixed Indexed annuities are protected from downside risk, while Variable annuities are subject to downside risk, and require a securities license to sell (such as the Series 7, or Series 6 and Series 63). 

A Fixed Annuity guarantees a minimum interest rate to be credited to the account. A “MYGA,” or “multi-year guaranteed annuity” which is a term commonly used interchangeably with “fixed annuity” is essentially a fixed annuity that has a set surrender schedule and a guaranteed annual interest return. MYGAs are commonly found in 3, 5, 7, and 10 year surrender periods, though other surrender periods exist too. Fixed annuities can either be deferred or immediate. A fixed immediate annuity is immediately annuitized and an income stream is immediately generated. A fixed deferred annuity accumulates or grows for a period of time, and is then annuitized later to generate income payments at a later date. There are also various riders that can be purchased with different Fixed Annuities such as income riders (which allow the annuitant to create guaranteed lifetime income without annuitization), penalty-free withdrawal (which increases the liquidity of an annuity), interest withdrawal (which allows the credited interest growth to be withdrawn), death benefit rider, etc. 

For more information about how to explain Fixed Annuities to clients, check out my blog “Fixed Annuities Explained.”

Indexed Annuities

An Indexed Annuity generates growth according to an index strategy selected by your client. For example, an insurance company may have interest credited based on the performance of the S&P 500 or other indices as well. The way they calculate interest to credit the client is based on index performance, and the limiting factors assessed by the insurance company. Caps, Spreads, and Participation Rates (more information below) all “limit” or “set” the amount of return that will be credited to the account based on index performance. Other factors such as an index strategy fee will affect the net credited rate. Indexed annuities essentially give clients the ability to participate in some of the market upsides, while staying protected from the downside. Indexed annuities are commonly deferred annuities, in which a surrender period is in place (commonly 5, 7, 10, or 14 years), and income payments are set to commence at a later date. Various riders can accompany indexed annuities, like lifetime income benefit riders, guaranteed minimum withdrawal benefit riders, long-term care riders, etc. There are other various guarantees that accompany some indexed annuities like penalty-free withdrawals, death benefit features, living benefits, and waiver of surrender charges for certain situations. 

A cap on an index strategy essentially sets the “ceiling” of possible credited interest. For example, if the selected index strategy grows at 10% during the crediting period, and the product has a cap of 5%, then the 5% is the most interest that can be credited to the account. 

A spread on an index strategy is essentially what the insurance company scrapes off the top. For example, if the selected index strategy grows at 10% during the crediting period, and the product has a 5% spread, then the insurance company takes the first 5%, and leaves a remaining 5% to be credited to the account. 

A participation rate on an index strategy is essentially the percentage of index growth that the account participates in. For example, if the selected index strategy grows at 10% during the crediting period, and the product has a 50% participation rate, the account participates in 50% of the 10% growth generating a credited rate of 5% to the account. 

For more information about how to explain Indexed Annuities to clients, check out my blog “Indexed Annuities Explained.”

Variable Annuities

Are we even allowed to discuss Variable Annuities??? A Variable Annuity is an insurance contract, where the owner of the annuity assumes the risk, not the insurance company. Because of that, securities licenses are needed to sell variable annuities. With a Variable Annuity, the owner is able to place funds into different subaccounts of a separate account depending on the risk tolerance of the owner. Various riders can be attached to Variable Annuities, and Variable Annuities can also be annuitized to generate an income stream.

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Creating Specialization

One of the things that I see all the time is agents who try to sell 3-5 different types of insurance products. This can actually hurt agents who do this because it slows them down from becoming true experts in any single area. The agents that I see having the most success are those who specialize in one or two product lines. For example, agents selling life, medicare, health, annuities, etc. will have a hard time being a true expert in any of those areas. It’s best to select one or two areas (ex. life and/or annuities) and become a true expert in one or both areas. 

I wrote a whole blog about the importance of specialization. Check it out here!

Product and Carrier Knowledge

Whatever type of product you choose to sell, you have to be an expert in the different insurance companies and products out there. Often times what will happen is agents will become experts in the products that their IMO offers them, but they stop there. Then they go out to an appointment, see another product that another agent showed the client, and they don’t know anything about it. You have to be an expert not only in what you are selling but also in what other agents are selling. 

Knowing what the industry as a whole has to offer does two things for you. First, it allows you to know what your competition may be positioning with your clients. Secondly, it allows you to make sure that you are showing your client the best possible product for their situation which is vitally important. 

Note: Do NOT product push. Find the problem that your client is facing, and find the BEST product solution for their individual situation. 

To find the best carrier and product information, you’ll want to work directly with the insurance companies. Be appointed with different carriers, and look at their materials. Study the products they offer. Make sure you’re part of a marketing organization that will help you find the best product for your client, not just push a product on you. If you’re curious about what a carrier has to offer, and you’re not appointed with them, do one of two things. Either reach out to your marketing organization just call them and candidly explain who you are and what you’re doing. They will work with you because they want you to sell their products. 

The bottom line is study, study, study. Know the carriers and products out there, and be a student of them. 

FAQ: Should I Only Sell Annuities?

Answer: Generally, I recommend agents stick to one line of business, (sometimes two), but when annuities are involved, I do recommend focusing on them exclusively. My background is in cross-selling life and annuities, but when I realized what annuities could be for my clients, I shifted gears to focus on annuities, and my business took off when I specialized. 

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Retirement Accounts

One of the things you have to be an expert in as well is Retirement Accounts like IRAs, 401(k)s and Employer Plans, Pensions, and the difference between Non-Qualified and Qualified funds. Don’t let this overwhelm you, it’s not as challenging as it may seem. 

It’s important to know the legal ways in which these different retirement accounts are taxed, rolled over, and withdrawn so that you can expertly help your clients when moving a retirement account into an annuity. 

There is a lot of great information out there that goes into much deeper detail about these different retirement accounts, but for the sake of this blog, I’m going to give you a high-level overview of them. 

IRAs

An IRA is an “Individual Retirement Arrangement,” which just means that an individual (not an employer) has created this account for the sake of retirement, but the advantage is the tax-deferred growth that is attainable through an IRA. 

There are different types of IRAs, and tax implications vary depending on the type of IRA. For example, Roth IRAs utilize after-tax dollars (non-qualified funds) to grow tax-free, whereas Traditional IRAs use either non-qualified or qualified funds to grow tax-deferred. 

Because of the tax-deferred status, funds in most IRAs, they are classified as qualified funds which essentially means that the funds in the IRA are going to be subject to taxation upon withdrawal. 

When a person starts an annuity, it gets classified as an IRA, and most annuities will allow other types of IRAs (like Roth IRAs) to transfer into them. 

401(k) and Employer Plans

401(k) and other Employer plans are typically qualified retirement plans. They can be rolled over into an annuity to create principal protection, and lifetime income, but you have to make sure that the company you’re representing will allow 401(k) rollovers (Or other plans if they apply to the situation). 

Pensions

Pension plans are employer plans that allow former employees to have either a lump-sum retirement payment or a stream of income in retirement. The lump-sum pension can be put into an annuity for the sake of generating a guaranteed lifetime income stream. 

If a pension is being paid out as periodic payments, it’s important to understand what the survivorship percentage is on it. That means that if the primary recipient of the pension were to pass away, what percentage of the pension payments would be passed on to the remaining spouse. This is very important to know and plan for when considering a client’s retirement income situation. 

Non-Qualified vs Qualified

The terms Non-Qualified and Qualified refer to the tax status of funds. Non-qualified money is “after-tax dollars.” Qualified money is “pre-tax dollars.” The way you can think about it is qualified money is qualified for taxation. This is a very important topic to be an expert on because different retirement accounts that your clients have will be classified differently. 

If your client is funding an annuity with qualified money, that client will be subject RMDs (Required Minimum Distributions), which will be taxed. Annuities funded with non-qualified money will not be subject to RMDs, but their gains will be taxed when withdrawn. 

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Taxes and Annuities

The way taxes and annuities play together is tied directly to their tax status as previously discussed. If the money funding the annuity is qualified, then all of the account plus the gains are subject to taxation upon withdrawal. If the money funding the annuity is non-qualified then just the gains are subject to taxation upon withdrawal. It’s worth noting that annuity withdrawals work using a LIFO (Last In, First Out) system. That means that when an owner makes a withdrawal, it will be the most recent gains first. 

Because most annuities get classified as IRAs, the annuity operates with a tax deferral benefit, meaning that an annuity owner’s gains can continue to return more gains without being taxed. Essentially, their tax dollars make them more money. That’s one of the major benefits of annuities, but remember the non-qualified vs. qualified taxation rules.

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Annuity Regulations

One of the most important things for you to be an expert on is the different annuity regulations that you and your clients are subject to. While insurance is generally regulated on the state level, there are federal laws that affect the way states are able to regulate as well, so you need to be informed about both. 

State Annuity Regulations

The best way for you to get information about state-level annuity regulations is to periodically check your state insurance department or commissioner’s website, as well as your state’s senate and house bills to make sure you’re informed about any changes on the horizon. 

For your convenience, here is a link to the Insurance Information Institute Directory of State Insurance Commissioners 

A common example of state regulation is that some states will require that a product has a surrender schedule no longer than 10 years, and a surrender fee no greater than 10%. Those states are called 10/10 states. 

National Annuity Regulations

The best way for you to get information about Federal-level annuity/insurance regulations is to stay up to date with the publications from the NAIC, and periodically check the U.S. Senate and House Bills for anything pertaining to the insurance industry. 

For your convenience, here is the link to the NAIC

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Establishing a Sales Process

One of the most important things you can do is establish a sales process. This is everything that you say and do to clients. You want to have a flow that you’re bringing clients into. It should be systematic, deliberate, and centered around two things: educating your clients, and doing what’s best for them. 

The moment you pick up the phone to call them for the first time, you need to know what you’re going to say, and how you’re going to say it, as well as the destination you’re trying to get to by the end of it. 

In appointments, the same thing holds true. Know what you’re going to say, what you’re going to show them, and where you’re trying to get them to. 

The best way I know to do this is to give you a glimpse into my process; one that has allowed me to sell multiple hundreds of millions of dollars of annuity premium since 2008. 

Mindset

One of the most critical pieces to success is often the most overlooked… mindset. If your mindset is off, your actions will follow. When I say “mindset,” I’m talking about your inner beliefs about certain things like morals, ethics, your own capabilities, what’s important in business, whose priorities are most important, and the “why” behind the “what.” 

For example, if your morals and ethics are skewed, the way you handle illegal, or unethical opportunities for business will follow that skewed mindset. If you doubt your own capabilities, more than likely, the way you actually communicate, run appointments, and talk with clients will reflect that doubt. If you believe that the financial bottom line is the most important thing in business, you will sacrifice other things for it. If you believe your priorities are most important than your client’s, you will do what benefits you more than them. If you don’t have a solid “why,” you will have a hard time pressing on when unmotivated… your mindset on these things is critical.

For me personally, I will not do anything immoral, or unethical. Following the law and doing things properly is a huge conviction of mine. I know beyond any shadow of a doubt that I am an expert, more than capable and qualified to help people protect their money. I believe that relationships are the most important thing in business, not the monetary bottom line. I will not sacrifice what is best for my clients to benefit myself. And my “why,” well that for me is to honor God in everything I do and say, and to advance His Kingdom. All of those core beliefs and principles shape my “mindset,” and you need to examine your own thoughts and ideas in those areas. Have a grounded and solid mindset. 

Phone Calls

The phone call is going to most commonly be your first point of contact with a client. The phone call is one of the most important parts of the process because there is so much that needs to be conveyed on the phone call in as little time as possible. 

Remember, your clients aren’t looking for a new friend (most of the time), they’re looking for an expert to educate them about the safe money options available, and which is best for their situation. The decision to purchase is always theirs, so don’t ever use high-pressure tactics. 

Below is a list of things you want to convey on the phone:

  • Your expertise
  • Your ability to educate them
  • You care about their situation
  • You are on their side

Note: with the exception of saying “I’m an expert in this area,” I don’t recommend saying those things verbatim. The list above is a list of truths that your clients should be able to interpret about you simply by talking to you. 

Below is a list of things you want to gather from them on the phone:

  • Any questions they have (and then answer them briefly on the phone)
  • Their age, and spouses age
  • When they plan to retire
  • Their retirement and investment account values
  • Emergency funds and savings accounts values
  • If they want a plan for living or a plan for dying (income or accumulation)

All of this is nicely complied in what I call my “mini fact-finder.” If you’d like to use it, go to Retirement Realized Agents Academy or call 512-798-3500. 

Note: The reason you want to gather this little bit of information over the phone is so that you can have an idea of what product you’re going to recommend to them in the appointment. 

And of course, you’ll want to set up the first appointment with them whether that be in person, or virtually. It’s worth noting that with annuities, face-to-face, in-person appointments still have better success rates, and create a better client-agent relationship. 

Fact-Finding

Typically the bulk of your Fact-Finding will be done in the appointment (the section below this), however, if you do your first calls the way I do, you will have a lot of good basic information from the first call that will allow you to go into your appointment with an idea of what best suits the client. 

When you’re Fact-Finding you’re going to want to get as much information as you possibly can in as quick a time as possible. Trust me, your clients don’t want to answer 3 pages worth of questions over the course of an hour. They want it quick and easy. I personally use a one-page Fact-Finder in my appointments, and it allows me to get all of the necessary information to make sure that the product I’m recommending is the best possible option for the client. 

I have a free document that teaches you how to build a Fact-Finder. You can download it here.

Remember to always look at your client’s worst-case scenario. That means examining their income vs expenses in their retirement and what the income would be for each client if the other spouse were to die. Annuities (specifically FIAs) are unique in that they can generate guaranteed income for life, with the potential for gains without any market risk. Not utilizing them for this purpose would be to miss out on one of the greatest benefits they provide. 

Appointments

Having a well-established appointment process is absolutely essential to getting your clients from point A to point B. Knowing what documents you’re going to go over, and what product you’re representing is absolutely crucial to having success. Generally, you don’t want your appointments to go much longer than an hour, and remember, your client is not looking for another friend. They’re wanting an expert. Build rapport by your expertise on the subject, not just flippantly commenting on photos, cars, and decor. 

When I conduct an appointment, I usually take 45 minutes for the first, and approximately 30 minutes for the second. The first appointment is all about education, fact-finding, and product explanation. The second appointment is all about answering questions, and filling out the application when your client understands the product and wants to move forward. 

The general flow of my first appointments goes as follows:

1) Explain who I am, and build up my expertise. 

2) Explain annuities from a 10,000 foot-view

3) Fact Find

4) Explain how the product(s) work in their situation specifically

5) Answer any questions

6) Leave them with the leave behind kit. 

I have a free document designed to help you build an appointment process based on the one I use. Download it here. 

Objection Handling

Objections are essentially questions or statements that clients may make to try to avoid moving further along and doing business with you. Objections commonly arise out of a lack of confidence in the agent/advisor, or a lack of understanding about the product. It’s important not to assume that an objection is a “no,” but it’s also important to respond to the objection in a way that brings clarity. Realistically, objections that are handled properly can be catalysts to helping your client understand and gain more comfort and confidence, simultaneously catalyzing the deal. 

Objection handling is more an art than a science, and one of the key attributes of a good objection handler is relatability. If you develop your relatability, you’ll become a better objection handler because you’ll see where the objection is coming from, and how to relate the response to the individual client. 

Don’t assume objections are combative, assume they come up because you missed something, or said something that made them unsure or uneasy. The more you handle objections, the more your responses will become engrained into your mind, and over time they will become much more fluid and smooth. 

I recommend practicing objection handling with an employee, family member, or friend to get more fluid and smooth responses engrained. I have a document called 21 Phone Objections where I give 1-2 sentence responses to some of the most common phone objections you’ll face. You can download it here. 

One thing you’ll notice over time as you improve your process is that some calls/appointments will have objections, and others won’t. The reason that some don’t have objections arise is that you “pre-handled” them, meaning you explained things in such a way that there was nothing concerning, or unclear about what you presented. This is the end goal for your calls and appointments….get to a point where you are consistently “pre-handling” objections. 

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Step Four: Getting in Front of Clients

Once you’ve become an expert, it’s time to get in front of people and start helping them with annuities. There are all kinds of ways to get in front of people, and thinking creatively is one of the most important things you can do when prospecting. 

The first thing you have to determine is how you want to get connected with people. Do you want to do the prospecting manually, or do you want to outsource it to a lead company? Manual and automated marketing/lead systems are the two overarching ways to get in front of people. 

If you decide to go the route of doing your own prospecting, expect a slightly longer ramp-up period before getting connected with qualified individuals, but potentially lower cost. If you decide to use other companies for leads and marketing, things may be faster getting started, but you will pay more. 

Personally, I choose to outsource leads and marketing to companies that specialize in it, for a couple of reasons. I know I’m not an expert at it, and frankly, I don’t need to be. The time I save by not doing my own prospecting allows me to spend more time working with clients and specializing in my process as well as the different products and carriers out there so I can stay up to date with product options.

Types of Leads

Annuity leads often get blamed for an agent’s lack of production, and while there are some poor leads out there, most of the time the agent’s process is the reason the leads don’t pan out. If you look for excuses, you’ll find them. If you look for solutions, you’ll find them. I say that as someone who has personally spent hundreds of thousands of dollars testing leads of all “qualities” and talking with agents all over the United States who’ve tried leads too. 

There are many different types of leads out there, but typically a “type” of lead is just a way of describing the way a lead is generated. For example, a “Scrubbed Internet Lead” is a lead that was generated via the internet, and the lead company has scrubbed or qualified that lead’s information. 

Scrubbed Leads vs. Non-Scrubbed Leads

Scrubbed leads have had their information verified in some way by the lead company selling them. Non-Scrubbed leads have not had their information verified. Keep in mind that a lead company will likely not name a lead “Non-Scrubbed,” but they will typically name a lead as “Scrubbed” because it’s a good marketing term. 

Exclusive vs. Shared

Exclusive leads are leads that are given exclusively to one agent or advisor. Shared leads go to multiple agents or advisors. I recommend only using exclusive leads, and frankly, most lead companies are starting to use the exclusive lead model. Generally, exclusive leads will be more expensive, but it’s worth the added cost. 

Internet Leads – Leads that have been generated from the internet. Typically a lead company will have a website (or multiple) that provide some kind of information to potential customers, and then have a call to action for the customer to submit their information, and get more of their questions answered, or even get something for free. Once someone has submitted the form, it either goes straight to an agent’s inbox (that’s called a “Straight Internet Lead”), or it will go to the lead company to be further scrubbed and qualified (that’s called a “Scrubbed Internet Lead” or “Qualified Internet Lead”). 

Social Media Leads – Leads that have been generated from social media platforms. Typically this occurs when a lead company utilizes social media ads to “offensively market” meaning they are advertising to people who may not necessarily be looking for an annuity, but the ad stimulates interest and then takes them to a website to gather their information which can then either be scrubbed or passed on to the agent or advisor. 

Seminar Leads – leads that have been generated via a seminar event. A seminar event is a gathering of potential consumers to listen to an agent or advisor give a presentation on a specific topic of interest. There are different seminar companies who will perform different parts of putting on the event. Seminars have historically been a very common way that agents and advisors prospect for clients. 

Radio Leads – leads that have been generated via a radio program. Whether the agent or advisor is the radio show host themselves, or ads are being run on a radio program, it doesn’t matter, they all get classified as radio leads. 

There are other types of leads like TV commercial leads, and email marketed leads, but they aren’t as common or as popular as the ones listed above. 

Remember that the name of leads is basically a grouping of descriptive words like “Scrubbed,” “Qualified,” or “Exclusive” and then the medium through which they were generated like “Internet,” or “Social Media.” 

Selecting Lead Companies

Selecting lead companies to work with is an important part of the process because you’re putting a lot on the line when you test a lead source. There are specific things to look for like their rating, reviews, ease of contact, and how long they’ve been doing business. I always recommend you personally talk with a representative from a lead company you’re considering working with, and ask them questions about how the leads are generated, are they exclusive, how many can be generated in a month, are they scrubbed or qualified, etc. 

It’s also important to try to have at least 3 different lead sources at any given time. Truthfully, there isn’t just one lead source that will be the end all be all for you, and lead companies tend to fluctuate in productivity anyway, so make sure you have multiple. 

If you’re curious about what I look for in a lead company, here’s a document that I made that explains the 5 most important things to look for in a lead company. 

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Why “Getting in Front of Clients” is Last

You may be wondering why you had to go all the way to the bottom of this blog to find the information about leads, well it’s simple. It would be a waste of your time and your client’s time to meet with them before you’re an expert. You have to be an expert before you try to solicit annuities, and I wanted to equip you with the knowledge of what you need to be an expert in before I explained marketing and leads. 

So now the ball’s in your court, and it’s probably time to study study study. Go back to the top, and take a photo of the list of things you need to be an expert in, then go become the expert. If you want a team of people behind you to assist you in this process, go to Retirement Realized Agents Academy, or Retirement Realized Financial and become a part of our training community or our FMO. 

We simplify annuity sales. Learn more about Retirement Realized Agents Academy today!

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Stay Up-To-Date with Annuties!

Check out the 7 Figure Annuity Sales Podcast to hear weekly episodes on all the current happenings in the industry! Also, be sure to subscribe on YouTube to see our beautiful faces for each episode!

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If you ever have any questions about anything at all, our mission is to serve agents! Give us a call at 512-798-3500 and ask for Caleb North! He knows the industry like the back of his hand and can help you with any annuity-related questions!

Thanks for reading and I hope this helps you sell more annuities! Happy Selling!

Additional content you may be interested in:

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How to Explain an Annuity to Clients https://rragentsacademy.com/2021/02/25/how-to-explain-an-annuity-to-clients/?utm_source=rss&utm_medium=rss&utm_campaign=how-to-explain-an-annuity-to-clients https://rragentsacademy.com/2021/02/25/how-to-explain-an-annuity-to-clients/#respond Thu, 25 Feb 2021 15:20:05 +0000 https://theannuitysalescoach.com/?p=340 If you’ve ever sold an annuity, undoubtedly you’ve had to try and figure out how to explain the annuity to your client. Agents often overcomplicate this process and try to utilize financial and insurance jargon to make themselves be perceived as an expert, but the reality is that doing that often just prevents the client…

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If you’ve ever sold an annuity, undoubtedly you’ve had to try and figure out how to explain the annuity to your client. Agents often overcomplicate this process and try to utilize financial and insurance jargon to make themselves be perceived as an expert, but the reality is that doing that often just prevents the client from understanding the product. 

Explain Things in the Client’s Terms

What I always try to help agents understand is that the mark of someone who truly understands how something works is able to communicate it in a way that the listener understands. If we truly understand annuities ourselves, then we should be able to communicate them in a way that the client understands. One way we can do this is by putting it in the client’s terms. 

By simply understanding what a client does or has done for a living, you can easily explain annuities in ways that they understand. For example, (I’m in Texas) if I’m meeting with a cattle rancher, I may illustrate how the product works by using cows as an example of money, and a ranch hand as an example of a broker or advisor. (From there you can fill in the blanks).

Or if I’m meeting with a bus driver, I might use passengers on the bus as an example of money and the destination as an example of a safe and secure retirement.

Analogies work beautifully for helping clients understand the concepts you’re communicating and literally every line of work, and even hobbies have ways for you to use their language in relation to your products. 

When you think in your client’s terms, it’s easy to explain things in a way that they understand. It’s important to not use financial jargon as a means of sounding intelligent, only use it when it’s necessary, but explain the function of the product in ways they understand.

Simplifying Annuities

Often, clients already perceive annuity products as complicated, and even agents can struggle to understand the ins and outs of the products they have available to them, but realistically annuities are pretty simple, and it’s important to intentionally study and understand exactly how your products work so that you can simplify them to clients. 

I like to think of annuities as vehicles. If an annuity is a vehicle, then the funds they use to purchase it are the contents of the vehicle, and there is a destination they want to get to. Maybe that destination is retirement, or safety and security. Maybe that destination is guaranteed income for the rest of their lives, or no more risk to market volatility. By understanding the destination they want to get to, you can determine what vehicle helps them get there, and you can explain it in those terms. 

Occasionally you’ll come across people with a background such that they understand the basics of annuities, and you need to explain specifically what’s going to be best in their situation. Or, you’ll come across a highly intellectual, highly analytical type of client. When these things come up, don’t assume that they know everything, but simultaneously don’t speak down to them with how you discuss annuities. You are the expert (if you can’t genuinely say that about yourself either you need more confidence, or you need to study more), and because you’re the expert, you should be the one guiding the conversation, and educating the client. We’re dealing with people’s money and because of that, sometimes things can get “sensitive,” but think of yourself as a financial doctor of sorts, not a general practitioner, but a specialist. A financial doctor who specializes in safety, security, guarantees, income for life, no market risk etc., and carry yourself as that specialist.

Types of Annuities

If you want an explanation of how different annuity products work, click on the types below.

Indexed Annuities

Fixed Annuities

Immediate Annuities

Objection Handling

We often get the statement “Annuities are Complicated.” For more material on how to get past the idea that “Annuities are Complicated” and how you can help others get past that idea too, just go to my “Annuities are Complicated” Blog. 

Remember, annuities are not as complicated as people make them out to be, and they are certainly able to be communicated in a way that clients can understand. Take some time and think about the common things your clients do or have done, and how you can use elements of their world, occupations, careers, and hobbies to explain annuities in their terms. 

Happy Selling!

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5 Things To Look For When Purchasing Annuity Leads https://rragentsacademy.com/2021/02/17/5-things-to-look-for-when-purchasing-annuity-leads/?utm_source=rss&utm_medium=rss&utm_campaign=5-things-to-look-for-when-purchasing-annuity-leads https://rragentsacademy.com/2021/02/17/5-things-to-look-for-when-purchasing-annuity-leads/#comments Wed, 17 Feb 2021 16:49:45 +0000 https://theannuitysalescoach.com/?p=326 Over the past 16 years, I have spent hundreds of thousands of dollars on annuity leads. Sometimes testing new leads works out well, and other times it doesn’t, but that’s just part of doing business in this industry. I’m going to share 5 things with you that I’ve realized over the years often correlate with…

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Over the past 16 years, I have spent hundreds of thousands of dollars on annuity leads. Sometimes testing new leads works out well, and other times it doesn’t, but that’s just part of doing business in this industry. I’m going to share 5 things with you that I’ve realized over the years often correlate with “good” leads. That said, before we get too much further, I want to clarify that a lead is really only as “good” as the agent who has it, but there are still objective differences that can help set an agent up for more likely success. 

1) No “Pre-Payment”

I have tried multiple lead sources that required upfront payment. Essentially the way these types of companies work is that you pay $___ before you get a single lead, and then they go generate you leads based on the amount you purchased. It could have just been the few lead companies I’ve tried, but they have never panned out well for me. That’s not to say that I haven’t gotten sales off of these leads, I have, but because I track my appointment rates, and close percentages with all my leads, I could see that there were significant decreases with the “pre-payment” leads. 

2) $25,000 Minimum

One consistent feature that I’ve noticed with lead companies I’ve had success with is that they all have a “minimum investible amount,” essentially that if a potential client doesn’t have at least $___ in investible amounts, they will not become a lead. The minimum that I’ve found most common and consistently productive is a $25,000 minimum. It’s important to note that just because a particular lead says they have $___ in investible amounts doesn’t mean that that is truly what they have. I have met with many clients who said on the lead that they only had $___, but by using my fact-finder, I learned they had way more than that. 

3) No One Under 45

Another must-have feature for me is no lead under 45 years old. Because I’m using straight annuity leads, I want to make sure the people I’m meeting with are likely to need what I’m offering. While selling an annuity to someone under the age of 45 is doable, it’s fairly uncommon. Because of that, I want to make sure that I’m not spending my time trying to help people that don’t necessarily need my help in their current life stage. You can argue that people under 45 could use an annuity, and I agree, but it’s rare for people under the age of 45 to truly grasp and embrace the idea of delayed gratification, and long-term thinking. 

4) Exclusive to One Agent 

One thing that is 100% non-negotiable for me is that the leads I use are exclusive. This means I’m the only agent who was given their information to reach out to them. I simply do not have the ability to sit by the computer and phone all day and wait for a lead to come through so that I can try to be the first agent to contact them. By using only exclusive leads, it allows me to set my schedule, and contact people in my pre-determined call times on Mondays. 

5) Annuity Specific Leads

I use exclusively annuity specific leads. This means that the leads I receive have asked about annuities specifically. Many agents cross-sell annuities with other products, so they can use mortgage protection leads, or Medicare leads, and address the client’s first concern, and then in proper scenarios present annuity options as well. I specialize in annuities specifically, so I use annuity-specific leads. If you’re wanting to specialize in annuities, there will inevitably be a point where you need to transition to annuity-specific leads. 

I want to clarify that not every agent is in a position to use all five of these criteria, but consider all 5 of these things when you’re purchasing new leads (especially annuity leads). To take it one step further, consider how the lead was generated. Was the lead doing their own searching for the types of products you sell? Or did the lead company do something to try to pique their interest, and then incentivize their lead form submission? Generally leads that have been advertised to, and then incentivized to submit a lead form are not going to be as great as leads that have begun their own search, and then submitted a lead form to get more information without any incentivization other than information and chatting with an expert. 

I hope this helps you make your lead purchasing decisions, and as always, Happy Selling!

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The Importance of Focus https://rragentsacademy.com/2021/02/03/the-importance-of-focus/?utm_source=rss&utm_medium=rss&utm_campaign=the-importance-of-focus https://rragentsacademy.com/2021/02/03/the-importance-of-focus/#respond Wed, 03 Feb 2021 19:04:17 +0000 https://theannuitysalescoach.com/?p=316 There’s a common mindset in the insurance industry that agents need to work in as many different forms of business as they can (i.e. doing life insurance, medicare, final expense, annuities, long-term care, retirement planning, assets under management….the list goes on) to generate revenue from as many different places as possible. This mindset is not…

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There’s a common mindset in the insurance industry that agents need to work in as many different forms of business as they can (i.e. doing life insurance, medicare, final expense, annuities, long-term care, retirement planning, assets under management….the list goes on) to generate revenue from as many different places as possible. This mindset is not only rarely successful, it can also be damaging to the client’s situation. 

There’s an old saying “he’s a jack of all trades and a master of none.” That saying exists because the reality is that it’s extremely difficult to truly be a master of all different types of products. You don’t see many pediatricians also practicing attorney services. You don’t see many lawyers also practicing dentistry. One might say “well yeah because they have a full workload specializing in one thing.” To that, I would say, “then why don’t we?”

To give a real-life practical example of what specializing in a particular type of product can do for you, look at my experience. I have no college degree, I was $150,000 in credit card debt in 2006 and 2007, but by focusing on a specific product type, I was able to climb out of it, and now I’m able to make more than most doctors in America and live a freedom lifestyle. Please understand, I don’t take credit for the ways I’ve been blessed, and I’m not saying these things in a braggadocious way. I want to inspire you to focus on something. The reality is you wouldn’t want to use a lawyer who was also a dentist…why? Because something inside you says “there’s no way he/she can actually be an expert at either.” For us, it is challenging enough to truly be an expert in any one particular product industry, much less if you try to do business in multiple product industries. 

The reality is that yes, you can sell all sorts of different products over the course of a year, but it’s not about selling products, it’s about being an expert. If you will devote yourself to a line of business and not spread yourself thin doing multiple things, you’ll be more equipped to help your clients, and I truly believe you’ll have greater success overall. 

This year, I’ve written over $2.75 million in annuity premium since the start of 2021, and I took an entire week off to celebrate my anniversary with my wife. Focus will open doors, and help you establish a well-oiled machine of a process that continually gets better and better with each passing year. Do yourself and your clients a favor and decide in 2021 to focus your work efforts on one thing, become a true and genuine expert in that thing, and watch what happens.

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Immediate Annuities Explained https://rragentsacademy.com/2021/01/13/immediate-annuities-explained/?utm_source=rss&utm_medium=rss&utm_campaign=immediate-annuities-explained https://rragentsacademy.com/2021/01/13/immediate-annuities-explained/#respond Wed, 13 Jan 2021 19:18:30 +0000 https://theannuitysalescoach.com/?p=288 There are two overarching types of annuities, immediate and deferred. Within deferred there are 3 types, variable, fixed, and fixed indexed. I’m not going to get caught up in all the different names that people have for them. I’m just going to use names that are primarily acknowledged by the Insurance Commissioner of each state.…

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There are two overarching types of annuities, immediate and deferred. Within deferred there are 3 types, variable, fixed, and fixed indexed. I’m not going to get caught up in all the different names that people have for them. I’m just going to use names that are primarily acknowledged by the Insurance Commissioner of each state.

Let’s jump into the immediate annuity. The immediate annuity is a product that the insured (the person who’s buying the annuity) puts in a lump sum of money. Let’s say they put down $100,000. Then based on a single or a joint lifetime payout, it’s going to determine how long they can receive the payout and for what dollar amount… it’s all based on their age. To determine this, they have an actuarial number. Let’s say the client is 50 years old, their life expectancy is to age 80. The insurance companies are going to say “$____ is what we can afford to pay based on that.”

If the client lives longer than age 80, the Insurance Company still has to make the payments, but if they pass away before age 80, the money is gone…Unless you do something called a “return of premium”. Return of Premium is if you die prematurely, whatever is left in that annuity would go to your heirs. Or you have something called a period certain it just simply means there’s a specific time frame, the annuity will payout. Then you have a period certain with a lifetime of income, so let’s say you have a 20-year period certain, and you pass away at year 15, that means your beneficiaries are going to be paid for the rest of the five years, the same amount you’re being paid. At the end of the 20th year, it’s completely gone. If you have a 20-year period certain with life, that means even if you surpass the 20 years, the income will continue to pay for the rest of your lifetime. Then, if you have a period certain with life and joint lifetime payout, it would continue to pay your spouse if you die. 

There are no shortages of nuances and different features with immediate annuities, but this is a broad, generalized overview of how they work. The way that I think about (most) immediate annuities is that it’s like writing a check to the insurance company and kissing it goodbye because of the common limitations to access the money. I personally believe it’s a very rare scenario where an immediate annuity is the best option for an individual. 

I hope this helps you understand immediate annuities a little bit better.

Happy Selling!

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Indexed Annuities Explained https://rragentsacademy.com/2021/01/06/indexed-annuities-explained/?utm_source=rss&utm_medium=rss&utm_campaign=indexed-annuities-explained https://rragentsacademy.com/2021/01/06/indexed-annuities-explained/#respond Wed, 06 Jan 2021 18:09:22 +0000 https://theannuitysalescoach.com/?p=284 Let’s jump into indexed annuities, and explain how they work, just as I would explain it to a client.  The indexed annuity started around 1995 and was the answer between the fixed annuity and the variable annuity. People say, “I don’t like a fixed annuity because my interest rate is too low. I don’t like…

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Let’s jump into indexed annuities, and explain how they work, just as I would explain it to a client. 

The indexed annuity started around 1995 and was the answer between the fixed annuity and the variable annuity. People say, “I don’t like a fixed annuity because my interest rate is too low. I don’t like variable annuities because of the high fees and losing money on the principle.” So the fixed indexed annuity answered those objections. In a nutshell, how fixed index annuities work, is that as the market goes up, you get a portion of the gains, and if the market goes down, you stay flat.

I have a chart that talks about the real benefits of indexed annuities, and it shows how it has factually performed at a 50% participation rate since 2000. It’s a very powerful chart because people often say, “Well, I need to risk money to make money. That’s what I’ve been told. That’s what my broker said.” That is a complete lie. I always respond to that by saying “No, you need to risk money, so your broker makes money…if you don’t have money at risk, your broker is not making any money, so they want to keep you at risk to keep making their fees.” That’s why brokers use statements like, “Let it Ride” or “Don’t worry, it will bounce back.” The fixed indexed annuity simply allows you to get a portion of the gains and none of the losses. Now, all index annuities base everything on three factors. You have the cap rate, known as the ceiling which is the highest amount you can make. You have the participation rate, a percentage of the index growth that you make, and then you have a spread. The spread is everything you would get above what the insurance company retains. 

For example, let’s just say the index makes 10%, and you have a 5% cap. That means the most you can get in that index is 5%. 

Let’s say you have a 60% participation rate. That means that you participate in 60% of the growth, so out of a 10% index gain, 60% of that growth would be 6%. What you make in that case is 6%.

The last one is the spread. If you have a 3% spread and the index made 10%, you get everything above the spread. So 10% growth minus 3% means you made 7% total.

Now, also in an index annuity, you could have some that have death benefit riders or you could have some that have income riders, and there’s usually a fee attached to those as well. If you have an income rider in an indexed annuity, you’re going to have an income rider fee (most of the time). There are rarely any fees other than that. Some newer annuities have come out that have a fee on the index. I don’t like those types of annuities because attaching an index fee to a product means that if the index doesn’t have any growth, and there’s still a fee, you could go backward. You can have an indexed annuity with a 1% fee on the index, and the market stays flat, but your client lost money because the 1% fee comes out no matter what… I don’t like that. I like telling my client in a fixed indexed annuity the money can never go backward due to market volatility. Now, of course, you have your rider fee, if you have a rider, that can happen, but due to market volatility, your account value and your income value cannot go backward.

So why do I like the fixed indexed annuity? Because it allows my clients to participate in some of the growth with none of the market risks, with the ability of also attaching an income rider. People way over-complicate the indexed annuity. Can we go into the total back end of index annuities and try to explain exactly how all the inner workings come together? Absolutely, but you don’t have to because the reality is, we’re not trying to hide anything, and they are not that complicated. 

Remember, always include the buyer’s guide, all brochures, all illustrations, and all disclosures, when you meet with the client. Leave that with them because you want everything you said to have a complete representation of what it factually does. Then you want the clients to read over all that information and you set another appointment to go over questions because you want them to understand the concept behind it.

We get to help people secure their retirements, not over complicated it. Understand how the Fixed Indexed Annuity works, and explain it in a way that the client understands too. 

Happy Selling!

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Fixed Annuities Explained https://rragentsacademy.com/2020/12/30/fixed-annuities-explained/?utm_source=rss&utm_medium=rss&utm_campaign=fixed-annuities-explained https://rragentsacademy.com/2020/12/30/fixed-annuities-explained/#respond Wed, 30 Dec 2020 22:10:35 +0000 https://theannuitysalescoach.com/?p=279 I often have agents asking how to simplify the explanation process of annuities. You have to understand that some clients don’t have prior knowledge about annuities or how they work. We have to be able to explain them in terms that they DO understand. So let’s dive into fixed annuities. A fixed annuity is very simple.…

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I often have agents asking how to simplify the explanation process of annuities. You have to understand that some clients don’t have prior knowledge about annuities or how they work. We have to be able to explain them in terms that they DO understand. So let’s dive into fixed annuities.

A fixed annuity is very simple. It’s similar to a CD, but it is not a CD, so don’t call it a CD annuity. A CD is something that comes from a bank, an annuity is something that comes from an insurance company. You have a bank and an insurance company doing something that is completely conflicting with each other because only banks can do CDs, and only insurance companies can do annuities, but it’s a similar concept. Calling a fixed annuity a CD annuity doesn’t make sense, and can cause more confusion for the client.

If you have a fixed annuity with a guaranteed period, they call it a MYGA, multiple-year guarantee annuity. It’s going to be set… Let’s just say at a 3% fixed rate for five years. That means every single year they’re going to have a fixed amount that’s going to come into their annuity in the form of interest. Now some of them will let you pull 10% penalty-free withdrawals. Some of them will let you pull the interest only. Some may not let you have any access to the money including upon death until the end of the term, so it’s very important that you understand how this works.

To go another step further, some fixed annuities may have simple interest, and others may have compounded interest. 

It’s important that you use the different benefits or riders with fixed annuities (i.e. penalty-free withdrawals, interest withdrawal, death benefit, etc.) along with the compound or simple interest to determine what product is going to be the best solution for your client. For example, someone taking interest only withdrawals each year wouldn’t inherently benefit from compound interest if there is a simple interest product with a higher rate. If you’re going to set them up with interest withdrawal, compound interest isn’t necessarily better than the simple interest. If someone is not going to take interest, they’re going to let it grow, then a lower compound interest could be better than a slightly higher simple interest. 

Further, I always use a death benefit (where the spouse or beneficiary has access to the money upon the death of the owner), and I always use a 10% penalty-free withdrawal benefit because I want the client to always have some level of increased access to their money for emergencies. 

The key is to not over complicate things. Annuities (especially fixed annuities) are simple products. It’s our job to show the client how the product works in a way that they understand. And if you understand the product, it’s easy to do. Use the CD analogy, but don’t call a fixed annuity a CD annuity. 

I know fixed annuities are simple products, but I hope this post is beneficial to someone out there.

Happy Selling!

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“Annuities are Complicated” https://rragentsacademy.com/2020/12/23/annuities-are-complicated/?utm_source=rss&utm_medium=rss&utm_campaign=annuities-are-complicated https://rragentsacademy.com/2020/12/23/annuities-are-complicated/#respond Wed, 23 Dec 2020 16:49:26 +0000 https://theannuitysalescoach.com/?p=276 One of the most common questions I get is “how do you explain an annuity to a client that knows nothing about annuities”. There’s a book that I wrote called Stress and Rocking Chairs, The 2 Common Killers of People Over 60. The whole purpose of this book was to explain in clear English, not…

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One of the most common questions I get is “how do you explain an annuity to a client that knows nothing about annuities”. There’s a book that I wrote called Stress and Rocking Chairs, The 2 Common Killers of People Over 60. The whole purpose of this book was to explain in clear English, not financial jargon, how to help clients understand how annuities work, because one of the common things we hear all the time is that annuities are complicated, they’re so hard to understand. Well, let me overcome that objection first.

Client: “Annuities are so complicated. They’re so hard to understand.”

“Okay, have you ever had a mutual fund?” 

Client: “Well, yes, I have.” 

“Have you ever read the 50 to 400-page prospectus that goes along with that individual mutual fund?”

Client: “No, I didn’t even know that. I’ve never even known about a prospectus.” or they say, “Well, yeah, I get those about every year, every quarter, I get prospectuses…” 

“Do you ever read them?”

Client: “No.” 

“Even if you got through the first two or three pages of that prospectus, you would be so overwhelmed with information that you’d inevitably be confused. Obviously, there are some clients out there that take the time to methodically navigate and understand their prospectuses, but for the most part, it confuses people. Now if you have 15 to 20 different mutual funds in your portfolio, you have 15 to 20 prospectuses; which is just crazy because there’s nobody that’s going to read those, there’s nobody that’s going to understand those completely…

I know agents that have been doing this for years that don’t understand how to read prospectuses. There are even people in the variable world that don’t understand prospectuses. So how could we say that annuities are complicated when the client has had to deal with things like a prospectus? Annuities are not complicated. 

The variable world is far more complex than the safe money world, in any product they offer, even stocks. Say you have a stock worth $100 and it goes up to $120. You multiply that by the number of stocks you have minus your fees, that’s what the value of your stock is, but have you ever read the financials of the companies? the PE ratios? all the variables that go into a stock? It’s unreal. So when we talk about complicated products, the fixed and fixed indexed annuities are some of the most simplistic products out there.”

If you have a client claiming that annuities are complicated, find out what other products they’ve had before and show them how those products are actually MORE complicated than the safe money product you’re showing them. 

Happy Selling!

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How To Start Selling Annuities https://rragentsacademy.com/2020/11/23/how-to-get-started-selling-annuities/?utm_source=rss&utm_medium=rss&utm_campaign=how-to-get-started-selling-annuities https://rragentsacademy.com/2020/11/23/how-to-get-started-selling-annuities/#respond Mon, 23 Nov 2020 18:13:07 +0000 https://theannuitysalescoach.weeknightwebsite.com/?p=143 “I’m intimidated by annuity sales, but I want to get started. Tips?” Congrats on making the plunge into the wonderful world of annuity sales. This is truly one of the most rewarding fields you could ever decide to jump into and if you apply these basic principles to your business, this field has the potential…

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“I’m intimidated by annuity sales, but I want to get started. Tips?”

Congrats on making the plunge into the wonderful world of annuity sales. This is truly one of the most rewarding fields you could ever decide to jump into and if you apply these basic principles to your business, this field has the potential to provide a life of abundance, adventure, and generosity!

Don’t neglect the basics.

It’s easy when jumping into this field to get overwhelmed by the complexity of some of these products. Is that you? Are you feeling the pressure of needing to know every little detail and every nuance within your products before opening your mouth about annuities to your prospects? You’re not alone. So many agents fail before they ever sell a single annuity because they are so fearful that they’ll say something wrong. Don’t fail because of inaction! Take every step necessary to build and expand your knowledge of what you do BUT do this as you go. Don’t spend your time getting ready to get ready. If you’re a licensed insurance professional, then you’re qualified but are you actually ready?

“When you ditch your fears and embrace the challenges ahead of you, your income growth potential is literally unlimited!”

If you’ve been stuck in this cycle, it stops now! Step into a freedom from your fears and recognize that information is literally at the tip of your fingertips. You can learn anything about anything on the web, and there are many great teachers that train on these topics if you know where to look.

Establish your lead flow.

Are you currently in life insurance? Medicare supplement? Healthcare? Retirement planning? Regardless of where you’re starting, know that you don’t have to go out and drop THOUSANDS of dollars on new leads like many people suggest. I actually think this is a huge waste of money on your end. Why would you invest your hard earned money on leads when you may or may not actually know how to sell them an annuity yet? It just doesn’t make sense. When getting started, the best way to establish a good lead flow is to keep your current lead flow going and learn how to begin cross selling into the annuity space. At this point you’re essentially creating new leads through fact finding. Let me explain. When you have a prospect who you’re selling life insurance to, dig deep during the fact finding process and if it makes sense for you to mention an annuity to them make note of it. Continue focusing on the primary reason you’re at the appointment, providing a solution to the problem they asked for help solving – in this example life insurance. Build trust. Build rapport. If you do a thorough fact finder and know that an annuity would be beneficial, now you’ve created a new lead essentially. They were a life lead, and they become an annuity lead once you take care of their life policy. Once you protect their family’s life insurance needs, they’ll be much more likely to trust you enough to help them with their retirement needs.

It only takes one sale to build momentum.

“One annuity sale has the potential to drastically increase your annual income! Shift your perspective from quantity of sales to quality of sales when in the annuity space.”

When in medicare supplement or life sales, quantity is everything. You have to close “x” amount of sales per week to pay the bills and make ends meet. With annuities this is true to an extent if you’re selling them exclusively, but in many ways your perspective needs to shift. One sale could pull in commissions in the tens of thousands and that kind of income is a game-changer for most agents. The reason I say this is so that you can set realistic expectations when adding these products into your client protection arsenal. Quantity is not your goal! Become an expert at cross selling when appropriate and over time you can transition into purchasing leads directly for annuities. This will take the pressure of and allow you to celebrate every small success you have. I wrote $18.7M in personal annuity production in 2018 and there were still weeks when I didn’t close a sale. It’s normal. Stay positive, keep learning, keep your client’s best interests first, and the results will follow over time!

Stay the course.

If success seems to be eluding you, don’t worry. REFINE. We constantly need to be refining our methods, or scripts, our solutions, and our skills. If you’re just getting started, the area I suggest focusing on the most is fact finding. This is HUGE. Be able to uncover the gold in your prospect’s retirement accounts. Dig deep! You might face resistance from some clients, but in order for us to best protect their interests we need to ask the hard questions. Don’t think of it as prying or awkward. If you do, they will feel this awkwardness. Stay positive, assertive, and upbeat, while maintaining your authority as the expert. Success is within reach and I believe that if you put in the effort, you can be successful in this industry! If you want more in depth training, enroll in Retirement Realized Agents Academy where I unpack my entire process from call to close!

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Why Are Annuities Needed? https://rragentsacademy.com/2020/11/23/why-are-annuities-needed/?utm_source=rss&utm_medium=rss&utm_campaign=why-are-annuities-needed https://rragentsacademy.com/2020/11/23/why-are-annuities-needed/#respond Mon, 23 Nov 2020 18:07:18 +0000 https://theannuitysalescoach.weeknightwebsite.com/?p=140 What is it about our products that our clients really want? Peace of Mind As an annuity producer, you offer your prospects one thing that, for many, far surpasses the rest in importance: peace of mind. You can offer them something that no broker has the ability to give them. Don’t forget that! When you’re…

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What is it about our products that our clients really want?

Peace of Mind

As an annuity producer, you offer your prospects one thing that, for many, far surpasses the rest in importance: peace of mind. You can offer them something that no broker has the ability to give them. Don’t forget that! When you’re in an appointment, this is what you need to focus on. Your prospects have been saving for decades to be able to retire worry free, and spoiler alert, MANY of them are not living worry free in their retirement years. So many retirees are living in fear. They’re living with the constant thought of whether or not their money will last or whether they’ll be able to pass money onto their children and grandchildren. Not to mention the worry that so many feel about potential losses in the market.

“We as annuity sales people offer something brokers cannot in many cases… safety and security with no risk to the market and guaranteed income that our clients can never out-live.”

If we can truly offer our prospects a solution to their biggest issue, peace of mind, then we never have to worry about sketchy “sales methods” and hard closing to get the deal. Our sole focus then becomes acting in their best interest.

What is the wrong approach?

It’s important to recognize that if you’re not series licensed then you can legally never tell your prospects that they need to get out of the market, and there can actually be serious legal repercussions if you ever do this. Just be safe – don’t do it! Our job as licensed insurance professionals who sell annuities is to inform and protect. If we would spend our appointment time explaining factually how our products have performed historically and constantly paint the picture of peace of mind. High-pressure tactics and hard-selling are NOT “techniques” you should be using in your appointments. These approaches are not right for our business and are likely to get you in trouble.

First Thing’s First

“If you put all of your energy into doing what’s best for your clients, the results will far surpass anything you could’ve dreamed for.”

This business is quite simple: Do what’s best for the client, and if you can’t provide a better solution then walk away. Don’t try to force something if it doesn’t make sense. Money has no emotions. It does what it does. It either works or it doesn’t. We can’t force a client’s situation to fit within the guardrails of our products if it doesn’t make sense for them.

At the end of the day, what’s the why?

At the end of the day, our clients are after 2 things – protecting and growing their retirement accounts. If they are looking for safety, security, guaranteed income that they can never out live with no risk to the market, then you can help them. Remember, our clients are looking for peace of mind, and we CAN provide that. That’s why we do what we do. The financial compensation becomes the icing on the cake.

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