{"id":285,"date":"2023-03-01T18:34:59","date_gmt":"2023-03-01T22:34:59","guid":{"rendered":"https:\/\/www.dinergywealth.com\/blog\/?p=285"},"modified":"2023-04-27T16:22:17","modified_gmt":"2023-04-27T20:22:17","slug":"whats-up-with-the-i-would-die-and-go-to-hell-before-id-sell-an-annuity-guy-really","status":"publish","type":"post","link":"https:\/\/dinergywealth.com\/blog\/whats-up-with-the-i-would-die-and-go-to-hell-before-id-sell-an-annuity-guy-really\/","title":{"rendered":"What\u2019s up with the \u201cI would die and go to hell before I\u2019d sell an annuity\u201d guy? Really?"},"content":{"rendered":"

I started out the day with a great plan \u2013 pull together a post about how the right annuity, designed with your specific needs in mind, can play an important role in protecting some portion of your irreplaceable wealth. Instead, I pulled a Sidney J. Harris (a columnist for the Chicago Daily News) who would sometimes write about \u201cthings I learned on the way to learning something else\u201d.<\/p>\n

I thought I\u2019d ask Dr. Google for some recent factoids about annuities. Simple stuff like: \u201cHow much money is invested in annuities\u201d? ($3 trillion by 12\/31\/17), \u201cWhat percent of Americans own annuities\u201d? (about 14% – although 85% of folks within 5 years of retirement want the benefits of an annuity), and \u201cHow many different kinds of annuities are there\u201d? (3-4 big categories but countless variations depending on your investment portfolio, your risk preference and future needs).<\/p>\n

Then I moved on to the more opinionated questions like: \u201cWho should invest in an annuity\u201d? (from everybody to nobody); \u201cWhat percent of your portfolio should be invested in an annuity\u201d? (from 0% to 100%); \u201cWhy should someone consider investing in an annuity\u201d? (from creating a downside risk buffer in their portfolio to creating an on-going income stream). It\u2019s no wonder annuities are a confusing topic for investors trying to care for their irreplaceable wealth.<\/p>\n

In spite of these diverse opinions, I learned that EVERY time the word annuity is in the Google search criteria, the same guy (we\u2019ll call him George) steps into that confusion with a series of paid ads with a simple message \u2013 be afraid. The first entry is some version of \u201cbeware\u201d, \u201cI hate annuities\u201d or (my favorite) \u201cI would die and go to hell before I\u2019d sell an annuity\u201d. That\u2019s a pretty strong opinion he\u2019s sporting there. I tried to think about how many things I would die and go to hell for. Believe me, it\u2019s a short (seriously short) list.<\/p>\n

This is where my plan for the morning took a left turn. Instead of an overview of annuities, I couldn\u2019t let go of all those ads and was drawn into the land of \u201cwhat\u2019s going on with George and why is he so angry?\u201d<\/p>\n

Now George is no fringe player in the investing world. He\u2019s been writing for financial publications since Gutenberg was their primary printer. He runs more web and TV advertising than just about everyone in the investment management business. He\u2019s always got a quotable quote for any and all media outlets. Some of you might even recognize George.<\/p>\n

I tried to imagine what could generate such animus towards annuities \u2013 especially since there are so many different types, each with different benefits, costs, flexibility, constraints, liquidity, and more. This is like saying \u201cI hate fish\u201d because they kill people. Sure, great white sharks and piranha have a well-deserved killer reputation…but goldfish? Guppies? Angelfish? Not so much.<\/p>\n

What kind of life experience could generate that kind of hate for and entire class of investment? I\u2019m not a big fan of clowns or spiders and I can draw a pretty straight line to the reason why. It\u2019s hard for me to imagine George having a bad experience with an annuity in third grade while exploring an abandon construction site (think spiders not clowns \u2013 but you get the idea).<\/p>\n

I don\u2019t know George personally but, in spite of his credentials as a fiduciary (i.e. accountable to act in the client\u2019s best interest), it doesn\u2019t make sense to write off an entire category of investments for all clients without knowing the needs and circumstances of those people.<\/p>\n

One interpretation of his message is that he\u2019s spending millions of dollars a year to protect you from what he believes is a poor investment choice. Another interpretation is that George has figured out how to create confusion about annuities and then leverage your fear into his alternative (one that’s coincidently more profitable for him that an annuity). Since George runs a profitable business, I can make an educated guess at which interpretation is closer to the truth but what do I know\u2026I\u2019m afraid of spiders.<\/p>\n

We approach annuities differently than George.<\/p>\n