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January 20, 2020 at 07:30 AM
Annuities remain an industry mainstay, but it’s no secret that many clients have low awareness of how annuities can help them meet their financial goals. At the same time, others may not understand how an annuity can help them meet their goals.
(Related: What If Your Annuity Client Ends Up Using Medicaid to Pay for Care?)
Now that the new year has arrived, it is a great time to refresh your sales tactics and position annuities in a new light. As you settle into the first month of the year, consider these three sales tips you can rely on when encouraging prospects to build annuities into their financial portfolios. Taken together, these tips will help your clients understand why investing in an annuity is a sound choice — after all, hindsight is 20/20.
1. Offer stability and security.
The new year is an exciting time, but it can be a period of insecurity. At the start of the year, many clients are likely thinking about ways to preserve and grow their assets as retirement approaches. When talking to your clients, consider bringing up the fact that annuities can contractually guarantee lifetime income without loss of value. Position annuities in a way that champions their security and stability — after all, very few financial tools available today can match the fixed growth guarantee offered by annuities.
2. Create comparisons to other products.
If you encounter clients with low awareness of the beneficial impact of annuities, consider drawing comparisons to similar products that are more familiar. For instance, as clients age, they often place a larger portion of assets into nonstock vehicles — like bond mutual funds — that help ensure they enter retirement prepared.
To help clients weigh their options, think about how a fixed annuity like a bond mutual fund without downside risks might be more suitable to their needs. Instead of taking on the responsibility themselves, as they would with a bond mutual fund, many clients will enjoy the prospect of transferring the responsibility of a downside risk to an insurance company instead.
