I have been spending a lot of time lately working on my retirement finances. After working with fixed annuity agents for over a decade, I have noticed that sometimes we help other people more than we help ourselves. This is a huge mistake because we should lead by example.
Around age 48, I started practicing what I preached with the purchase of annuities with income riders (seven annuities and counting). At age 53, I am looking at second-to-die life with long-term care riders and making some decisions about cash-value-building life insurance as well as some other things to create long-term tax-advantaged cash flow.
When I am looking for inspiration and on the concept of income floor planning, one of the people I like listening to is Tom Hegna. Tom was a keynote speaker at the Round-Table Radio Marketing Conference. I spend nearly every working day of my life designing annuity-based income plans for the agents I support and sometimes forget about the importance of life insurance, but Tom was able to get me motivated to add more life insurance to my portfolio.
For risk-based investing, one of the investors I listen to is Rick Rule, who specializes in precious metals and fixed assets. Rick, unlike many precious metal investors, does not turn his commodities investing into a religion. He approaches investing from a pragmatic, Warren Buffett-style philosophy: Only invest in what you understand. Turning investing into a religion is very dangerous, because it can blind you to the various angles of risk.
What I also like about Rick is that he constantly talks about being capitalized and having “dry powder.” In other words, money that sits around and does nothing until there is a market crash, so you can take advantage of below-intrinsic-value prices on equities and assets.
So what does any of this have to do with annuity sales? More than most people realize.
Dry powder can only be used with certainty when you have an income floor. An income floor allows you to have the confidence to allocate capital into risk when everybody is running from the fire.
Think about this with respect to your personal finances. What if you had all the residual lifetime income you would need guaranteed for the rest of your life and then had a bunch of cash sitting on the side? How would that make you feel?
One, you would have a massive amount of pressure released from your shoulders.
Two, you could confidently take advantage of buying opportunities in fixed assets, commodities, and equities when everyone else is liquidating. You would also feel a great freedom and less reserve to invest in your business. This could create massive amounts of wealth over the recovery period, which is typically a short period of time.
That leads us to some very important questions:
- Are you attacking this business knowing the potential of building an income floor for yourself and having a bunch of dry powder waiting for the right opportunity?
- Are you allocating capital to marketing and working your sales process considering the massive demographic opportunity to share this strategy with others?
- Are you selling the income-floor and a dry-powder philosophy with passion and enthusiasm to your clients and prospects; not just as a planning philosophy, but from a belief rooted in your own personal finances?
I am not a fan of man-made religions, especially those that are rooted in money. But, unlike risk investing religions, fixed annuity agents get to believe in something that has guarantees. In my book, that makes what we do worth believing in.
Just like adherents of all religions:
- We have to believe in something.
- We have to demonstrate that belief through personal practice.
- We have to share that belief with passion based on the confidence we achieve from our practice and the experiences and testimony of those that have the same belief.
Are we sharing a religion or a cult? A cult is a religion with a belief based on a lie.
For myself, and I hope for all my fixed annuity agent partners, I truly believe that having a guaranteed income floor is the best insurance someone can buy on this earth other than life insurance. I think it makes people happier and live longer by removing stress.
For me, that is a fact, not a theory, because it is something I practice, not just preach. I have seen the impact in my life and all those I have shared my beliefs with. They are happier and more secure in their retirements. Not only is the guaranteed lifetime income annuity religion is worth believing in, it’s a proven way to live life with less stress while providing the flexibility and opportunity to allocate liquidity to take advantage of undervalued assets.
If you need more faith, listening to Tom Hegna. It will help you become a believer. Sometimes when your faith is lacking it doesn’t hurt to utilize the faith of others.