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F&G's Chris Blunt: Are You Up on Inflation-Friendly Strategies?

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As president and CEO of F&G Annuities & Life, Chris Blunt runs an insurer that’s on track to generate more than $9 billion in revenue this year.

He previously was the CEO of Blackstone Insurance Solutions, an investment organization that helps manage assets for insurers. He has been in the middle of the fight to help life and annuity issuers cope with the effects of low interest rates on their investment earnings for years.

Blunt also helps shape how other financial professionals see the world, as a trustee of The American College of Financial Services.

Via email, we asked Blunt a set of questions that touch both on his professional knowledge and on what he does off the clock.

1. What market indicator, industry statistic, regulatory change or advisor trend are you watching most closely right now and why?

Chris Blunt: F&G just released the findings of our second annual Risk Tolerance Tracker, which keeps the pulse on concerns of American investors. The study found that investors saw inflation as one of the biggest concerns, with nearly three-quarters (73%) noting they are worried about inflation impacting their retirement. I was reflecting on the fact the last time people were this worried about inflation, I was listening to Led Zeppelin on my 8-track player! I look at wage growth as a leading indicator of whether or not inflation is becoming more systemic and less transitory. Hopefully, we’re not headed for 1970s-style inflation, but advisors would be smart to bone up on inflation-friendly investing techniques just in case.

2. How has it been changing recently (2021), and how do you expect it to change (2022)?

As I mentioned above, inflation is on everyone’s mind. It ranked as a top concern in our study, followed by high health care costs and market volatility. While investors still remain risk averse, there is increasing openness to new financial products, as more investors noted they’d be willing to explore new options.

We expect this trend to continue, and there’s a real opportunity for advisors to take advantage of this interest to introduce their clients to solutions they may not have previously considered, such as annuities that can give them some exposure to equities (one of the few investments that has the potential to keep pace in an inflationary environment) with some downside protection, which may encourage clients to stay the course.

3. What would you suggest advisors do now or consider doing in the future about it?

Listen more and talk less. Be explicit in connecting clients’ expressed hopes and fears to specific solutions (e.g., “Here’s how this product or strategy can help reduce this risk”). For example, we know from both our own and industry research that most clients approaching or in retirement don’t always bring up the subject of annuities to their advisors, yet we also know they worry about volatility as well as outliving their money.

Don’t present products in isolation, but rather as part of a holistic solution.

All products represent a series of tradeoffs and should be presented to clients as such.

4. Who or what critical source of information do you track, or follow online, to keep up with this or other trends?

Friends and neighbors are often my most insightful sources of information on consumer trends and real-life concerns. Regarding the financial markets, I look most closely at credit spreads, as I find they are pretty good indicators of how the markets are feeling about the health of the economy and the state of corporate balance sheets.

5. Are you changing any of your work habits at this stage of the pandemic? Why/why not?

We can’t ignore the new norm around expectations for workplace flexibility. F&G has embraced a hybrid model as we’ve proved over the past two years that we can excel without being in the office every day.

Having said that, people are psyched to interact in person when they can and I’m no exception. Having flexibility is nice but sitting across a table from a real person or two can be incredibly energizing and productive. Personally, I think we’re making too much of this topic and trying to force extreme choices when the world has voted with their feet – they want flexibility, including the opportunity to gather in person.

6. What’s your biggest hobby and what was the last event/activity you did related to it?

Hiking is clearly number one, although in the winter it’s skiing. Most recently, my wife and I completed a 12-mile hike in Colorado, and we did the Grand Canyon rim-to-rim hike a few years back, which was a bucket-list item for us.

7. How about your latest community/charitable activity/event/cause?

Since 2020, myself, F&G and our employees have donated over $200,000 to the Food Bank of Iowa, providing 90,000 meals to those in need. This includes a recent gift this month of $100,000 to help those throughout Iowa have greater food security this holiday season. In addition, our recent United Way campaign raised $800,000 — resulting in F&G’s most successful United Way campaign to date.

Personally, I’m very engaged as a board member of the YMCA of Greater New York, where we recently opened two brand-new facilities in the Bronx. In addition, I am a trustee of The American College of Financial Services, which is doing some ground-breaking work on economic empowerment and equality, as well as something called Purpose School, helping successful professionals to transition into the world of societal impact.

8. What book are you reading now and why? (Could also be movie, TV show, etc.)

I recently finished Beneath a Scarlet Sky by Mark Sullivan (a great story you can’t believe is true) as well as Essentialism by Greg McKeown, because we’re all struggling with how to optimize our time these days, for both personal and professional reasons.

9. Any special holiday plan, activity or focus you’d like to share as we near year-end? Or a New Year’s Resolution that you’ve decided on?

Just beyond excited to gather with family and friends to reflect on how incredibly blessed we are to be together.

10. Any other update/fact about you or piece of advice/wisdom you’d like to share with our advisor audience?

I started my career as a financial advisor with Shearson Lehman Brothers (now Morgan Stanley) and still consider myself an advisor at my core. And, despite all the challenges, there’s never been a better time to be in the business of helping clients turn their aspirations into reality.