You are so right about disclosure checklists and communication (“10 steps to prepare prospects to say ‘yes,’” May 2008). Senior clients need to be treated special and breaking down each aspect of the product or service is essential. I use the “ show and tell” system, then questions for understanding, then a review. If I am working with the elderly client with hearing or memory issues, having a third party (especially a beneficiary or heir) at the meeting is critical.
-David Ruibal, Allstate
“The Annuity Taxation Primer,” an article that appeared in the March 2008 issue of Senior Market Advisor, includes a paragraph that requires clarification. The article should make clear that income accumulating within a deferred annuity contract is not subject to current income taxation and also is not included in a taxpayer’s income for purposes of calculating the amount of the taxpayer’s Social Security benefits that will be subject to income taxation. This is generally true so long as income generated inside the annuity contract is not distributed. However, any funds withdrawn or distributed from the annuity contract would count as income for the purposes of calculating taxes on Social Security benefits to the extent that such a distribution is taxable for federal income tax purposes.