Annuities have gone through an evolution and because of this evolution we now find that we are dealing with more of a hodge-podge of annuity products.  As a result, annuities are commonly sold on the benefits of the so-called first year bonuses, 10% free withdrawals, tax deferred growth and the ability to capture stock market returns without the risk to principle and these benefits, as well as others, may be beneficial to the average annuity consumer.

The fact is, we as annuity marketing and salespeople and retirement advisors, have often become complacent when we set the stage for selling the annuity concept as a safe haven for retirement.  At times, we are far from being fully recognized as a well-rounded Retirement Planning Specialist and are just seen as being an annuity sales person – but you are not just another sales person.

In the past decade, over one trillion dollars have been invested in annuities and 80 to 90 percent of those annuitants and owners are not taking an income from the annuities and in fact will never need to.  Many annuitants and owners are keeping the funds in annuities to pass on to their heirs or for the ability to access the funds, should they need nursing home care.

According to the IRS publication #575, 100 percent of the earnings from annuities are fully taxable upon distribution to the heirs.  Without sound planning, your client’s annuity dollars could go to the IRS, resulting in substantially reduced benefits to their heirs.  Assisting clients in planning that will allow them to leave a tax free inheritance to their heirs will change their lives for generations to come. With people living longer, new retirement strategies are needed to fulfill the wealth transfer objective.

As the annuity broker professional, how do you set the stage for properly implementing the so-called annuity arbitrage or rescue concept?  It simply can start with identifying whether or not the existing annuity accounts are providing the client with money to live on in retirement, or if the money is intended to be left to the client’s heirs, which are their children and grandchildren.  This can be done using a simplified, quick issue method of repositioning current annuity assets to attain a tax-free transfer of wealth at death.

The annuity arbitrage concept can be implemented through various methods.  The first method can be as convenient as utilizing the 10 percent free withdrawals by leveraging those withdrawals into a competitive, flexible premium universal life product.  The second method is to completely annuitize the policy, in which most annuity companies will waive the surrender charge upon annuitization and allow the annuitized payment to be funded into a flexible premium universal life product.  Now let’s not forget the third method of annuity arbitrage, where we now have the ability to place 100 percent of the annuity proceeds into a new, innovative single premium universal life product.  With this product the client has the option to receive a loan equal to the amount of the tax expected, once the annuity account is converted into the life insurance product.  What an economic way of converting annuity accounts!

By the use of life insurance, our clients can still maintain tax deferred growth while continuing to be linked to stock market returns, with certain index universal life products, and they provide long term care protection as well as offer guaranteed death benefits for the beneficiaries.

Two things in life are certain: death and taxes.  As a professional working with Tyrone Clark and Brokers Choice of America as well as with BCA Marketing, I strongly believe it’s a very ripe time to embrace and implement wealth transfer strategies in order to take care of our clients.  This way, if they live another 30 years, they can leave tax-free money to their children and grandchildren, while providing themselves with long term care protection. In the end, you will be the recognized retirement professional you are, and the one who is skilled in offering clients sound planning advice.

Educating one’s self about relevant information pertaining to the insurance industry and annuity product training is essential to your success.  This is why Broker’s Choice of America offers basic annuity training / prospecting classes.  Let BCA help you gain the knowledge needed to increase your insurance and related business.
BCA insurance agent training classes will teach you the knowledge and skills to expand your services to include a broader spectrum of clientele.  Our instructors and programs will guide you through the learning process like never before, applying theory to real life applications.
Annuity marketing and insurance broker training exists to better educate, inform, and to help you invest in the skills required to succeed.  Learn more about financial education training courses offered, life insurance broker training instructors, and financial planning education modules designed to increase success.
For more information pertaining to the training and insurance selling systems offered, call 1-800-344-4105 or contact your personal Business Development Advisor.

Annuities can be a sound retirement planning building block when it comes to long term income replacements, which is why Broker’s Choice of America believes they should be considered as an excellent resource for your clients.  Annuities allow for the option of protection of principle and the option of an income rider or a guaranteed lifetime monthly income, while also protecting the client’s original investments from stock market fluctuations and losses.  Fixed annuities and indexed annuity products are a main focus of Broker’s Choice of America, including Multi-Year Annuities. BCA offers training to help educate you about all of the benefits that these products can offer to your clients.

BCA is proud to provide educational training to help increase your annuity marketing capabilities.  Invest in learning the skills to become successful.  For additional information on annuity and insurance marketing, contact your Business Development Advisor or contact BCA via email or by calling 1-800-344-4105.

When it comes to marketing your life insurance, financial planning prospecting, etc., it pays to work smarter.  BCA strives to keep our marketing systems relevant and up-to-date, which is how we have been able to create numerous successful Annuity Prospecting Programs that can help you increase your annuity marketing strategy.

BCA’s prospecting tools are developed to be efficient, user-friendly, and effective.  Prospecting Programs include:

Unique TV Advertising Opportunities
Radio Show Content Idea Guide
Seminars
Direct Mail

Broker’s Choice of America will help you to uncover prospects via a multilayered prospecting campaign using easy implementation methods.  To inquire more information about how BCA can help increase your annuity prospecting and leads, call 1-800-344-4105.

As seen in the August 2011 edition of "The Register" from Tyrone Clark and Senior Business Development Advisor Joseph Clark:

Ultimate Tools to Longevity Risk Planning

Attention: Advisors and Attorneys, there is a new tool within the niche market of Medicaid and Aid & Attendance Veterans Benefits Planning. The era of the single premium life is back, thanks to the new and improved features, which help the most vulnerable of clients — the widowed individual. As we know, our single clients tend to be the most challenged and also the most common because of extended life expectancies that are a result of the enhanced medical technology of the times that we live in. The new average life expectancy for females is now age 85, up from age 81, and males are making it to age 81, up from age 78; according to the new 2001Commissioners Standard Ordinary Mortality (CSO) tables that calculate insurance rates for new policies.

This niche is set to become the Holy Grail for Medicaid & Veteran Benefit planners who are seeking answers to the complex strategy of qualifying the single client for entitlement benefits, due to the challenges presented by the extended look back period of any transfers done within five years. The Deficit Reduction Act (DRA) has made it a bit challenging and limited for these clients. It is a well-known fact that the US population is aging, and as a result, many of financial and estate planning techniques that have been used for years need to be revisited and revised. It has been estimated that 80% of women outlive their husbands by 7 to 10 years as widows. The sad reality is that the financial advisors or “Safe Money” advisors, whatever they portray themselves as, have unfortunately not addressed the true risks to the pre-retired community. These risks are the direct economic impact to the client for the enormous cost of healthcare and catastrophic illness expenses that are costing families and spouses their life savings!

Case Study: Ethel, who is 85 years old and for years has been living independently, now needs full-time nursing home care and plans to apply for the Medicaid program benefits to help cover the new cost of her care. She has $100K in CDs and Savings that she had planned to leave to her daughter, Kim, age 52, and to her son, Mark, age 55, to help cover her grandchildrens’ education expenses. Under Medicaid rules, Ethel would need to spend the $100K, completely depleting the legacy she has worked hard to create. The usage of the single premium whole life insurance policy would name Kim and Mark as the rider beneficiaries. Since Kim has three daughters and Mark has one son, Ethel wants the death benefit to be paid out to Kim and Mark in a ten year payout at 75% to Kim and 25% to Mark. Ethel also designates Kim as the policy beneficiary to receive $1,000 in lump sum death benefit. Kim would receive a monthly income for ten years of $619.00 and Mark would receive a monthly income of $265.33.

The new era of single premium life product is intended to provide a limited guaranteed death benefit and cash value that meets the Medicaid rule standards to fully exempt assets in order to qualify for government entitlement benefits. By the use of this type of SPL Whole Life policy, there is no underwriting requirement or any type of physical in order to qualify, because it is a guaranteed issue life insurance policy. Utilizing this type of life insurance, our clients can still maintain “peace of mind” from the enormous expenses of LTC costs and offer guaranteed death benefits for their family. These are two things in life that are certain — catastrophic illness/nursing home spend down and death.

As a Senior Business Development Advisor with BCA Marketing, I strongly believe it’s a ripe time to implement this new life insurance product. With this product, if our clients live another 30 years, they know that they can leave their legacy to their children and grandchildren while also protecting their  hard earned assets from the costs of long term care.

Brokers' Choice of America, BCA is committed to keeping you up to date with the major changes that effect our marketplace.  What can we say about the last three days except for WOW! 

Here's a recap:

S&P lowered its rating on the U.S. long-term debt by one notch on Friday -- the first such downgrade in history. The rating agency said that it lacks the confidence that our political leaders will take the steps necessary to avert a long term fiscal crisis.                                            
 Monday the Stock Market plunges and we see the worst drop since 2008.
 Wall Street is now heading into a  “bear” market territory, and today we see nearly a 6.7 per cent decline -bringing the S&P 500 index to more than 18 % off its high for the year. 18% !

Investors fleeing to “safe havens” of Treasuries and gold.

Gold rose to a record $1,720 per ounce - a new all time high.

Now is the time for you to be proud that you specialize in insurance products that offer consumers safe money options that can help protect their retirement nest egg.

WASHINGTON BUREAU -- The National Association of Fixed Annuities says it believes federal regulators are classifying fixed annuities as swaps.

NAFA, Milwaukee, makes that point in a comment letter submitted to the Commodity Futures Trading Commission (CFTC) and the U.S. Securities and Exchange Commission (SEC) in a response to joint SEC-CFTC efforts to develop the definitions needed to implement the swaps provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010. NAFA's understanding of the proposed definitions is that a fixed annuity would be defined as a “swap,” or a "security-based swap" or "security-based swap agreement," and therefore subject to SEC regulation, NAFA President Kim O'Brien says in the letter An amendment to the Dodd-Frank Act sponsored by Sen. Tom Harkin, D-Iowa, made it clear that fixed annuities are excluded from federal regulation, including regulation by the SEC, and that the products should be regulated by state insurance regulators, O'Brien says. NAFA believes the proposed swaps definitions would classify a fixed annuity as a swap or security-based swap because, under the proposed swaps definitions, any insurance or annuity product that does not come within the exclusions set forth in the proposed rule is defined as a swap, O'Brien says. NAFA believes an appropriate approach, consistent with congressional intent, would be to treat fixed annuities as insurance arrangements that are not swaps unless they fail to meet criteria set forth in Section 3(a)(8) of the Securities Act of 1933, O'Brien says. Instead of presuming that “you are a swap until proven insurance,” the operative presumption should be “you are insurance until proven a swap, O'Brien says.

*This article from National Underwriter - by Arthur D. Postal  - published 7/25/2011  http://www.lifeandhealthinsurancenews.com/News/2011/7/Pages/NAFA-Fixed-Annuities-are-not-Swaps.aspx

Today the market has changed, we have gone from cars, to pagers, to cell phones, to androids and now we are almost an online virtual society. Many of us interact with each other, visit our family members, gain our information, educate ourselves about important decisions and purchases and even gain our entertainment on-line via the social networking world.

Today's financial consultant needs to become familiar and integrated with today's society, in order to attract today's business opportunities. For example, the average person is now gathering information and basing decisions on feedback from social networking sites. Other large corporations are already moving into this territory like Northwestern Mutual, who has established guidelines and provided standard, compliance approved language to their advisors for use on social networking sites such as Linkedin and Facebook.  There are several new online communities that are transforming the way people think and act with regards to finances and investing.  There are sites dedicated just to investing, such as www.covestor.com which enables members to follow trades of "living room" investors and this enables them to invest alongside of them.  Another site www.stockpickr.com enables people to create virtual portfolios.

In summary, our message to you, the financial consultant of today, get in the game and embrace social networking, at least on a professional level. You are missing opportunities if you are not positioning yourself to be the trusted financial consultant of your online community.

Americans have been taking on more debt in May and are using their credit cards more for the second time in nearly three years. Kicking up borrowing as the economy begins to slump and hiring is slowing.

The Federal Reserve said Friday, that consumer borrowing has risen to $5.1 billion in April. That following a revised gain of $5.7 billion in April. Borrowing in the category that covers credit cards increased, and borrowing in the category for auto and student loans, also increased.

Borrowing is usually a sign of confidence in the economy because a consumer will tend to take on more debt when they feel wealthier. That in return boosts consumer spending and eventually gives businesses more faith to expand and hire.

BUT - we are seeing an increase in credit card debt. Credit card debt is a sign that people are falling on harder times.

The summary - the economy is slowing, it added only 18,000 jobs in June the slowest in nine months, the unemployment rate is 9.2 percent, which so far is the highest rate of the year. These factors plus the slumping housing market, fears of a fallout from the European debt crisis, all will weigh on the economy possibly for the rest of the year.

Today's pre and post retiree have redefined their definition and view of retirement as a result of our countries current long winded economic "recession".

The new outlook - about 54% now view retirement as a new chapter in life.
Retirement, of course, is now being postponed with most people considering the 5 years later mark as realistic.
Financial Peace of Mind is now estimated to be 6 times more important than accumulating wealth. With over 80% of people naming it as their key financial goal.

Financial Peace of Mind is now taking center stage providing financial consultants, who work in this area with a potential great opportunity to assist more clients.

*This study -The Sun America Retirement Re-Set Study, was conducted in April by the Harris Interactive, and interviewed 1,001 Americans ages 55 and older about their emotional mindset, attitudes and expectations of pre-retirees and retirees nationwide post-recession.