Re: Re: Re: Re: Re: Re: Re: Re: JAX -new thread

Subject: Re: Re: Re: Re: Re: Re: Re: Re: Re: JAX -new thread

Comments:
: : : : : : : : : : : Jax, lets start a new thread. I will post UNDER your responses to keep it mor clear and linear. : : : : : : : : : Eric : : : : : : : : ------------------------------------------------- : : : : : : : : Jax, : : : : : : : : VA's are tricky as to whom you sell them to and why. : : : : : : : : If the client wants the death benefit, why not Life Insurance? You can leverage assets instantly, and they go tax-free to heirs instead of in a VA. Fund a SPIA, and use the payments to fund the Life policy...(and you get paid twice :) : : : : : : : : The death benefit isnt very helpful if you cant lock in gains with a step up rider, and those add expense, and cut off at certain ages. Also, lets remember, you have to DIE to take advantage of a death benefit. Living benefits can help there, but again...more expense. : : : : : : : : Annuitization should NOT be an option...there is no flexibilty after you make that irrevocable decision. If the client wants income...what about Bonds? Tak Free Munis? : : : : : : : : I sell VA's for their flexibility. The client can keep contributing tax deferred, but can be in or out of the market in a phone call. : : : : : : : : Eric : : : : : : : Why not sell life ins.? That is a different story. : : : : : : : Let's say that we only use the standard death benefit of return of prem. , then the VA becomes like a MF, with the downside guarantee. For very little, your client can have a stepped-up death benefits, and No VA I sell does the death benefit go away at any age. : : : : : : : I deal in the senior market mostly. Life ins, which I sell a lot of ,VUL, it is good for transferring wealth, but itis not for everyone. Look at the surrender charges in life ins. : : : : : : : Some people want to annuitize, however, I don't recommend it in most cases. : : : : : : : I do a lot of systematic withdrawls. In fact, I have a lot of clients withdrawing from the VA to the VUL in the same company. : : : : : : --------------------------------------------------- : : : : : : Jax, : : : : : : Step-up in Death Benefit does go away, as early as 70 in some contracts. Of course, the plain ole' DB never goes away. : : : : : : The problem with the downside protection, is they have to die to get it. : : : : : : Have you looked into the split annuity? : : : : : : Most goes into a fixed, that will grow to the original principal amount in x yrs. The rest goes into a VA to get growth potential. : : : : : : Worst case scenario, the client is guaranteed principle and doesnt have to die, and the growth is theirs as well. : : : : : : Eric : : : : : The stepped-up benefit that I could sell levels off, it never goes away. : : : : : You say you have to die to get it, that is right. What happens if you die with a MF? : : : : : I am familiar with the split concept. : : : : : Normally, I sell the standard death benefit. : : : : : What VA and Vul do you sell? : : : : : : : : Jax, : : : : I sell Hartford, and our proprietary VA underwritten by Achnor National. : : : : The Step up goes away Jax, it just depends when. You still may have locked in the DB, but the step-up ALWAYS goes way at a certain age. The DB stops stepping-up at a certain age. The rider cant be on the contract after certain ages. I think the oldest one out there is 90 (Allmerica?) : : : : Like I said, the downside protection of the VA is good, it is just that you have to die to get it. I just think there are better ways to protect the downside, and not have to wait for death. : : : : My philosophy is if they are young, go agressive in the market. : : : : If they want to protect principle, try fixed annuities. : : : : If they want income, use bonds. : : : : If they want flexibility of fixed and variable accounts, with tax benefits, use the VA. : : : : Eric : : : The annuities that I sell, the stepped-death benefits do NOT disapperar at any age. They may have a max. age that the DB does not step-any more, let's say age 86, but it stays at that level for life. : : : Anchor National's death benefit stops at age 90 on some of it's annuities. : : : Maybe you are selling the wrong annuities. : : : : : : You say you use bonds for income, what is wrong with taking a withdrawal from an annuity? : : --------------------------------------------- : : Jax, : : Regarding the step-up, we are saying the same thing with different words. The Stepping up goes away, but the DB locked in doesnt go away. : : I dont sell the step-up at all, so the VA's I sell work for me. I do alot of Interest Averaging, and Split Annuity Plans to turn "savers" into "investors." : : As far as Income, Munis are tax-free, and do not eat into the principle. : : With a VA, income from it may be exposed to many things: : : -If the VA is underperforming, the income may have surrender charges, & eat into the principle. And if you are under 59 1/2 there is a 10% IRS penalty. : : -If the VA is making gains, there will be taxes due on the income. : : Eric : : ----------------------------------------------- : How can you have surrender penalties on withdrawls from VA's when the 10-15% free withdrawal is based on prem. paid in? : I only sell the standard DB. : You have more opportunity for gains in a VA as opposed to a muni. : In a VA, you have 9-10 different fund managers and can rotate from one fund family to another without a taxable event nor any sale charges. : I sell several million $ $$ of each. : I also sell some index annuities. : Sell whatever blows up your skirt.\ : I also set up ILIT and fund them with 2nd to die life ins.

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