Winning in Retirement

Annuities: 2 We Like & 2 We Don't Like

• Akers Financial Group

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Brian Akers and Jeff Akers, both certified financial planners, discuss the pros and cons of various annuities in their show "Winning in Retirement." They highlight the importance of financial planning and understanding annuity contracts. They like fixed annuities for their guaranteed returns and fixed indexed annuities for their potential growth linked to stock market indices. They dislike immediate annuities for their inflexibility and variable annuities for their high fees and market risks. The Akers emphasize the need for a balanced portfolio, using annuities as tools to provide guaranteed income and protect against market volatility. They encourage listeners to consult with a financial advisor for personalized advice.

Unknown:

The following is a pre-recorded show. Welcome to Winning in Retirement with your host BRIAN AKERS, certified financial planner professional and founder of AKERS Financial Group. Now helping you win in your retirement. Here's BRIAN AKERS.

BRIAN AKERS:

Welcome to Winning in Retirement. I'm BRIAN AKERS, president and founder of AKERS Financial Group. I'm Certified Financial Planner Practitioner, and so is my co-host Jeff AKERS, Certified Financial Planner Practitioner. Good morning, Jeff. Good morning, Brian. I'm very glad to have you here with us.

Jeff Akers:

It'll be fun.

BRIAN AKERS:

It'll be fun.

Jeff Akers:

We'll have a good time.

BRIAN AKERS:

Why is it a good time?

Jeff Akers:

It's always a good time when we do winning in retirement.

BRIAN AKERS:

Yeah, I like that concept. That's always fun. Hope everybody's listening enjoys our show. When you look at our show or listen to our show, you can actually go to our website@akersfinancial.com and check us out there. If you ever miss anything,

Jeff Akers:

that's a good thing to to know. Do

BRIAN AKERS:

you know we've been doing shows these these winning retirement for over seven years now. It's been great.

Jeff Akers:

Seven years, wow!

BRIAN AKERS:

And we have over 215 of our shows recorded on our podcast, there,

Jeff Akers:

so you can go and listen to any of them, almost any of them.

BRIAN AKERS:

Absolutely, and so what we're doing today is we have a very special show we put together because we know there's lots of information out there, and everyone's always trying to figure out what's best to do. And so we are trying to do today is we want to have four quarters that are extremely important, and a different topic each quarter that relates to your money, that relates to a topic called annuities.

Jeff Akers:

Annuities. Annuities.

BRIAN AKERS:

So each and every quarter is going to be designed around that and around around different things. We're actually going to do the show, and the show is called Two Annuities We Like and two annuities we don't.

Jeff Akers:

Okay,

BRIAN AKERS:

that sound good?

Jeff Akers:

Yeah, it's kind of balanced.

BRIAN AKERS:

So two annuities we like and two we don't.

Jeff Akers:

There you go.

BRIAN AKERS:

We're going to be honest. We're going to try to explain how we apply it in our practice. It's sort of like a dose of a piece of annuities as be our basic advice.

Jeff Akers:

Right. It's not really enough to say we like this annuity. We want to tell you why, yeah, or to say we don't like this one. We want to tell you why, so that you have a better understanding of where we're coming from.

BRIAN AKERS:

I think that's always helpful. The best, the

best idea is this:

AKERS Financial Group. We start with financial planning, and financial planning begins with you, your unique financial fingerprint, wherever you are in life, your investments, your income, your pensions, your ability to save, the ability of debt you have, we believe retirements about cash flow. There's just so much going on that we need to make sure you understand that we're trying to reach your goals through the use of financial tools that are out there, and we do believe that annuities can be a tool that can be used in preparing for retirement,

Jeff Akers:

right? And something you've always said is that the plan determines the investment, what we're going to use, not the other way around. If someone says, "Here's what you got to use, but they haven't said anything about what are your goals or what are you looking to do, then you know that that's a problem. So we start with a plan that determines what we're going to use,

BRIAN AKERS:

absolutely. So the financial planning is where we're going to sit down with you and go over your situation, understanding what's going on, and that begins it. We need information like tax returns and documents where your money is currently, and put it all together. Very, very important things to do. All right, I got some big questions for you, Jeff.

Jeff Akers:

Okay.

BRIAN AKERS:

How do you spell the word annuity?

Jeff Akers:

It's a spelling bee. A n n u i t y.

BRIAN AKERS:

How about annuities?

Jeff Akers:

A n n u t i e s.

BRIAN AKERS:

There's no i before the t there.

Jeff Akers:

Annuities. a n n u i t i e s. Skipped that

BRIAN AKERS:

I the second time. Did I? Yeah. We're

Jeff Akers:

gonna play this back and see if I. All right. So

BRIAN AKERS:

annuities. There's two eyes in there. I'm not sure why, but I I like to say two eyes because you need to read the contract. So I'm sorry. So the joke is this: there's two eyes in annuities. You need to read the contract. It's a tool. It's an investment tool, but you need to read what you buy. Most annuities are sold to people. People don't run around going,"Hey, give me annuity. They get annuity positioned or sold to them, and that's what they buy,

Jeff Akers:

right? Without necessarily understanding what it is that they

BRIAN AKERS:

bought. Yeah. So the idea of two eyes to look at the contract. Annuities have contracts. Those contracts are the rules of the annuity, the rules of how liquid the money is. If you can get it back out or not, and understand it. So let me go backwards in time.

Jeff Akers:

Okay,

BRIAN AKERS:

this is back. I believe this was right, right after, right after I hired you.

Jeff Akers:

Oh, okay. No, no, I

BRIAN AKERS:

hired you one year before this. Yeah,

Jeff Akers:

yeah.

BRIAN AKERS:

All right, september 11, 2001,

Jeff Akers:

right,

BRIAN AKERS:

was a terrible day in U.S. history. Terrorism hit our shores, then destroyed New York, D.C. airplanes, all kinds of things. A lot of 1000s of people passed away, and then many, many other things went wrong. The market shut down on that Tuesday,

Jeff Akers:

right. And stage shut down.

BRIAN AKERS:

The stock market and the bond market went down. Yep. And so one of the things that crossed BRIAN AKERS' mind at that time is that my retirees had a different risk in my mind-a terrorism risk in their finances.

Jeff Akers:

Right. Suddenly, someone from outside the country could come in and do something, and it negatively impacts their clients,

BRIAN AKERS:

their retirement, and so my brain went to the portfolio design of stocks, bonds, and cash was everything I've ever learned. That's the normal stock broker, the normal way you're taught. And I was taught at Virginia Tech Finance and all these things, and that's what we did. That's what I did for first 10 years of my career, and then I wanted when the markets reopen a week later, they reopen down 27% on the stock market and down 27% on the bond market. And so the the wording that came across my mind is that I wanted to make my safe money safe, that protected money, the lower risk money that no risk. I don't want it to have risk because its role is to be the protection,

Jeff Akers:

right? So you don't want to lose, no matter what happens.

BRIAN AKERS:

This is way before target date funds. This is just normal stock, bonds, and cash portfolio asset allocation design, diversification, all of that combination. Back then, we had gold. We had 16% international. Those were the ways you built portfolios. Now we had to go out and figure out what is actually protected, and so things are protected are things that are guaranteed by the federal government,

Jeff Akers:

right?

BRIAN AKERS:

So FDIC through banks,

Jeff Akers:

right? FDIC insurance,

BRIAN AKERS:

so FDIC money markets, CDs, savings, checking.

Jeff Akers:

Yeah, money markets at the time weren't even FDIC insured. That came later.

BRIAN AKERS:

Oh yeah. Oh wow.

Jeff Akers:

Yeah.

BRIAN AKERS:

But not all money markets are FDIC insured in today. A mutual fund, right? Right.

Jeff Akers:

Even today. Yep.

BRIAN AKERS:

So depending on where you buy it, you might have FDIC.

Jeff Akers:

Right. Right.

BRIAN AKERS:

Now, if you buy something through a bank that's a different type of product, they'll actually disclose not FDIC. Really big, and that's one of the things you need to know. FDIC, Federal Deposit Insurance, and that basically provides protection of your money up to certain levels. You go to FDIC.gov, you can read about the levels of protection through that.

Jeff Akers:

Right.

BRIAN AKERS:

Insurance companies are another way of offering protection. That protection through an insurance company is backed by their assets.

Jeff Akers:

Right. Yeah. So the FDIC is an insurance company. It's just backed by the U.S. government, but other insurance companies they've got an asset portfolio, and they use that to back the guarantees that they're making. So it's important to know how highly rated they are. You want to know that they've got enough assets to back what they're guaranteeing,

BRIAN AKERS:

and so the ratings matter. Yes, and so as a company, we want a rated, a a rated or better. We don't want anything that has a B plus or B or anything lower. Or if it goes to that level, we don't want to stay in it. So the annuity level of the guarantee would be right back by the assets of the insurance company. The other guarantee is the other insurance companies um sort of protect each other,

Jeff Akers:

right? And throughout history, if an insurance company got into trouble, other insurance companies would come in and buy them out and then keep the guarantees to the clients that had been made.

BRIAN AKERS:

But only the guarantees, no matter what that meant,

Jeff Akers:

right? Guarantees, not the wishful. We hope this is going to happen. We're

BRIAN AKERS:

not going to name names of companies where we've helped guide clients who had those companies on through the process and out of the process, but it does happen,

Jeff Akers:

right? It does. So you have to be careful.

BRIAN AKERS:

So we have looked at annuities, and we believe that they are tools in financial planning, especially for pre and actually in retirement years. There's actually four types of

annuities:

two we like and two we don't.

Jeff Akers:

Okay,

BRIAN AKERS:

and we're not going to stay. Oh, we're going to slowly work our way that way. Okay, so the first topic in this quarter is really about we were seeking protection from things we can't control. Now in '01 we had the problem of terrorism. By I think it was by was I think February March of '02. All of a sudden we had WorldCom and all the other issues of fraud on on the balance sheets, right?

Jeff Akers:

Yeah.

BRIAN AKERS:

And so 17 companies had such fraud that they disappeared from the market. Right. A utility company, Enron, yeah, used to be Portland Electric or something like that.

Jeff Akers:

Right, we actually had a client who had that.

BRIAN AKERS:

Yeah, he had the extra stock certificates, and we he got them out with safe. And and he shows me that I go, yeah, that's a good one. At least it used to be

Jeff Akers:

worthless now. That's

BRIAN AKERS:

Enron. Oh, really? But they had balance sheets problems where they would show a balance sheet, but then they had off balance sheet financing and no cash, and so investing back then we pick stocks based on hey do they have cash or not

Jeff Akers:

right and that

BRIAN AKERS:

thankfully that was our design and that helped us protect from disappearing stocks like that

Jeff Akers:

avoid some of those.

BRIAN AKERS:

The next type of downturns was the oh seven through oh nine march 9 of oh nine. As the market went, the S and P went down 68% Yeah,

Jeff Akers:

that was a big drop,

BRIAN AKERS:

huge drop, one of the biggest drops, and that was the mortgage crisis and other issues. Um, big brokerage firms went under because they were backing or trying to back bonds, which they didn't have enough assets to back.

Jeff Akers:

Right, and there again, that's where the insurance companies' ratings come into play because yeah, they were affected too.

BRIAN AKERS:

I remember Monday morning on September of '08, the CNBC announced that the annuities for those that think your fixed annuities are safe, they're not. And it was just this guy. The announcer was going off on the fact that that fix is not guaranteed. Then the reality was that if an insurance company has a guarantee corporation, which they buy, put their fixed products in, it is guaranteed.

Jeff Akers:

Right.

BRIAN AKERS:

All the other subsidiaries are not guaranteed. So companies like AIG and a few others that had 200 other subsidiaries, they had troubles and went under. But the fixed guarantee side was fine.

Jeff Akers:

Right. That was the gear

BRIAN AKERS:

because they had some companies that were backing mortgage securities, and that's one of the things that caused a lot of problems. You had Lehman Brothers and Merrill Lynch and AIG were three of the many, but AIG was one where one of one of the new clients came in said,"Hey, I got AIG. What do I do? I said, "Let's call them, and their money was still there.

Jeff Akers:

Right.

BRIAN AKERS:

And then I said,"Okay, your surrender periods this month just happens to be September of '08.

Jeff Akers:

Right. Let's

BRIAN AKERS:

get it out of there to another insurance company, just so you feel better, and because we get a better rate. Yeah. So what we're doing here in the first quarter is just explain a little bit about annuities and why AKERS Financial over the last that's 25 plus years um have been putting some annuities into portfolios, and we'll try to explain that further as we keep going along.

Jeff Akers:

Good.

BRIAN AKERS:

You think that's good?

Jeff Akers:

Yeah, I think that's good.

BRIAN AKERS:

Well, it's worked out very well with everything that changes in the markets. But what's great is this: is that AKERS Financial Group, we are local and we are independent. We don't report report to a big company on Wall Street. We don't report to a company in Iowa, in Iowa or Idaho, any of those companies. We report to you, our client. We have offices in Lutherville, Forest Hill, all around the Mid-Atlantic region. We have clients. We have clients all around the country, even a few around the world. It's so easy to begin winning in retirement. Just give us a call and schedule your free meeting with one of our team of advisors by calling 833 Win Retire. That's 833 W i n r e t i r e. We'll give you a call on Monday to schedule your free meeting and your free in-person meeting. Go to akersfinancial.com or call us at 833-946-7384 to start planning for your retirement now. If you want to spend your last dollar on your last day, how do you actually do this? We will explain in a moment.

Unknown:

You're listening to a pre-recorded show. Welcome back to Winning in Retirement. Call 833 Win Retire now to schedule a visit with Brian and his team and begin Winning in Retirement. Once again, here's BRIAN AKERS.

BRIAN AKERS:

Welcome back to Winning in Retirement. I'm BRIAN AKERS. I'm president and founder of AKERS Financial Group. Here with me today is Jeff AKERS. We are both certified financial planner practitioners. Jeff has been working with me since 2000.

Jeff Akers:

2000 September.

BRIAN AKERS:

So this whole what do you call it? Century,

Jeff Akers:

millennium.

BRIAN AKERS:

The whole millennium. The

Jeff Akers:

entire well, I didn't start january 1, 2000. So

BRIAN AKERS:

almost the entire millennium,

Jeff Akers:

right?

BRIAN AKERS:

That's a long time.

Jeff Akers:

Yes, it is an entire millennium. You have no idea. Of course, I've been related to them longer. So

BRIAN AKERS:

this is my fifth decade of work of doing financial services and planning, which is fun. Yeah, I know you're listening to our show, Winning in Retirement. You just can't wait to hear our information we have for today. And so Jeff and I will get right to our subject. Our subject is two annuities we like, two we don't.

Jeff Akers:

Very good. So that there are well, Brian said earlier there are four different kinds of annuities that we're going to talk about, but there are two that we use and two that we don't, and I think we're going to kind of split it up and do one that we like, one that we don't like, and then go back to one that we like, one that we don't like.

BRIAN AKERS:

That's true, but we don't want to. We want to tease without being mean.

Jeff Akers:

Oh, okay.

BRIAN AKERS:

All right. So we ended last show with the last quarter, not last show, last quarter. If you want to spend your last dollar on your last day,

Jeff Akers:

how do you do that?

BRIAN AKERS:

How do you do that? And so we're going to describe the good parts of an annuity.

Jeff Akers:

Okay.

BRIAN AKERS:

Then we're going to explain you don't like it.

Jeff Akers:

Okay. What we don't like. Yeah. Yeah. I understand. All right.

BRIAN AKERS:

That makes sense.

Jeff Akers:

Okay.

BRIAN AKERS:

You can play good. I'll be the good cop. You be bad cop.

Jeff Akers:

Oh. Well, can I can I do just brief history?

BRIAN AKERS:

Yes. You do brief history. Let's go ahead and start with Jeff's brief brief history of immediate annuities. The

Jeff Akers:

brief history of annuities. Annuity just means lifetime income. You're going to get a stream of income for the rest of your life, and that idea, that concept, has been around for a couple 1000 years. So if you have a pension, then that's an annuity because it's going to. Pay you for the rest of your life if you get Social Security. Social Security is a form of annuity because you're going to get that payment for the rest of your life. When you die, your Social Security ends. Now, if you're married, I know your spouse might get part of yours, but for the most part, it's your life, and then that's it. There's no lump sum that goes to anyone else.

BRIAN AKERS:

All right. So annuity companies, which have been around a couple 100 years, right? Before Dow Jones started in 1896, any of that. Yep. An annuity is where you give an insurance company money,

Jeff Akers:

right? Give them a bunch of money,

BRIAN AKERS:

and then they give you small checks,

Jeff Akers:

right? They give you a little bit of money every month as long as you're alive.

BRIAN AKERS:

Yes, if you ever heard that the annuity company keeps your money, that would be this example.

Jeff Akers:

You give them$100,000 and they pay you for a year or two, and you've maybe gotten back $20,000, and then you die. Well, the other $80,000 the insurance company keeps.

BRIAN AKERS:

Yeah. So one examples I've seen is I had a executive of a company. He was not a client, of course. He I got his wife later, but as a client, the the key thing is that the executive chose single life for his pension, single life payout, the single life payout, and was healthy on retirement day, got cancer and died within two years.

Jeff Akers:

Oh,

BRIAN AKERS:

so I guess 3540, years of working for that company, creating a wealth called a pension.

Jeff Akers:

Right,

BRIAN AKERS:

chose single life, which means his life only,

Jeff Akers:

and that was only two years.

BRIAN AKERS:

And then in two years, the insurance, the insurance backer of the of the payout says, "All right, no more payments. Vincent

Jeff Akers:

said that's it. Yeah, oh, and so

BRIAN AKERS:

that was a 20,000 a month payment that ended.

Jeff Akers:

And now his wife, who survives him, has to use other money to make up for that income to

BRIAN AKERS:

create somehow,

Jeff Akers:

right, and try to still

BRIAN AKERS:

fulfill the goals that that that person had given to the whole family because they had wealth,

Jeff Akers:

right?

BRIAN AKERS:

Oh, and they still have wealth. But the hard part is that it wasn't. It's not the same situation. It changed nearly what it was. And it was all because of the choice of an annuity. Now, when people get ready to retire, we sit down and talk with them about choices of single life,

Jeff Akers:

right?

BRIAN AKERS:

Joint life,

Jeff Akers:

right?

BRIAN AKERS:

Joint life versions of 50% 100% all kind of stuff like that.

Jeff Akers:

Right for for pensions, we like some of the options that might have a pop up. There's all different kinds of choices when you have a pension, and so you don't want to just look at which one gives me the biggest number because that one's going to end when you die. So we need to look at the other options and figure out which one is the best for your situation.

BRIAN AKERS:

Now, on our 401k plans, a new law puts in into your statements of an annuity option on the bottom of your statements, saying that when you retire, this can be converted to a certain annuity payment.

Jeff Akers:

Right, and it'll pay you so much for the rest of your life, but it doesn't take into account whether you have a spouse or no. It's a

BRIAN AKERS:

single life calculation down there, right? So if you take that option off your four 1k statement, that's exactly we're talking about,

Jeff Akers:

right? So

BRIAN AKERS:

if you um if you retire, sign the paperwork, get and what and drive out the driveway and don't make it home, it's done. Yes. So there's annuities annuities that you can buy like this a single life immediate annuity, and it'll pay the rest of your life. There has been a couple cases in my 40 years that I've ever used them.

Jeff Akers:

Right, there are certain circumstances where it makes sense.

BRIAN AKERS:

Right,

Jeff Akers:

but it's a tool that we use when it fits. It's not something that's for everyone by any stretch of the imagination.

BRIAN AKERS:

One place it fits is if you have a small amount of savings and you want to get a payment that'll last as long as you do, and you don't need there won't be any money left over, but you got to squeeze everything you can out of

Jeff Akers:

it, and no one else is depending on you for that income.

BRIAN AKERS:

And then when you do that, and that payment runs, and then when you pass away, now if you live a long, long time. It's a great calculator. You win. You win because you got a lot more money than you ever put in.

Jeff Akers:

But that's how you spend your last dollar on your last day.

BRIAN AKERS:

It is by having this immediate annuity, or when you we brought it into the pension idea, so people can understand what we're doing. You can actually purchase these. So usually on four 1k statement, that bottom line is a company that's tied to the 401k that gives the quote. Usually, you can do better than that if you really want it to go that way. But we would guide people never to go that way,

Jeff Akers:

right? We would do something else. But the term that we use, single premium immediate annuity, that's what we're talking about when we buy it from an insurance company on our own.

BRIAN AKERS:

And so, two the two annuities we don't like. This is the first one that we don't like because immediate annuity means you lock in that money for payment. You lock in that money that will be paid out to you for life. Your decision is final. There is no. It won't be on your assets sheet anymore. It's locked in. I don't feel that people need that. I rather use the the milk or the elf the cow. Rather use the interest and dividends and let that money grow for legacy and combination, and so have the ability and flexibility of taking more money later,

Jeff Akers:

and make sure that you've gotten out of your money all of

BRIAN AKERS:

it. Yeah,

Jeff Akers:

you don't want to die prematurely, and you lost a bunch of money.

BRIAN AKERS:

Yeah, so a media annuity would be one of the ones we don't1. ones we do like is called a fixed annuity. A fixed annuity would be the insurance company's version of a CD.

Jeff Akers:

Right. We we refer to as a multi-year guaranteed annuity. It's going to pay a fixed interest rate. MIGA.

BRIAN AKERS:

MIGA. M Y G A. Not that kind of MAGA. It's MIGA.

Jeff Akers:

MIGA. Yeah. Say it properly.

BRIAN AKERS:

MIGA.

Jeff Akers:

I'd MIGA. Okay. So

BRIAN AKERS:

multi-year guaranteed annuity. Yeah, it's going to pay

Jeff Akers:

a fixed interest rate for a fixed period of time, like

BRIAN AKERS:

three years, five years, or higher.

Jeff Akers:

Right. Yeah, that's the thing about annuities. They can go really, really long. They have all kinds. We don't like them. Remember, there's

BRIAN AKERS:

two eyes in annuities. You need to read the contract. If the contract says five-year guarantee, but in the small writing says it's locked in for 10 years, make sure you know that before you sign on for that policy.

Jeff Akers:

Right there's something called a surrender schedule, which is like a penalty for early withdrawal if you take the money out too soon. And at the end of that surrender schedule, and hopefully also the end of the guaranteed interest rate, then you've got a window of time, just kind of like with a CD, where you can take the money out and there's no penalty. But if you miss that window, then it's probably going to re-up for another period of time. That's back to read the contract, know what you got,

BRIAN AKERS:

whatever the rate is. Now, a fixed annuity like this, if you're prior to 59 and a half, you put the money in and you take the money back out. You have a 10% penalty because it's designed for retirement,

Jeff Akers:

it's for retirement, so you can't touch it until 59. It is

BRIAN AKERS:

tax deferred on buildup.

Jeff Akers:

It is tax deferred. Someone will pay tax eventually. It's not tax

BRIAN AKERS:

avoids avoidance, or

Jeff Akers:

you can put it off, but you can't get rid of it. The tax that

BRIAN AKERS:

absolutely. So these a fixed annuity. When does it come in play? Well, the idea is this: if you want to ladder your investments, you want to have some money and cash to be able to pay your bills for next year or so. You buy a CD at the bank to go one to two years. The annuity you come in for that three to five year, and the rates could be four to 5% or depending whatever the rate is that month. It changes every few weeks, and we change companies that we use based on which is offer the best with the highest value. We know that there's something called banding, where they band together certain amounts of money, give you higher rates.

Jeff Akers:

Right. If you put$100,000 in, you get a better rate than if you put in $99,000, for example.

BRIAN AKERS:

Yeah. So you don't put 99 in. No. Yeah. So they call that high band in the industry when it comes to fixed annuities, fixed annuities have a role when it comes to earning interest. But basically, in portfolios, you say I have to commit more time to get more money. This is an example of that,

Jeff Akers:

right? You have to pay attention to what your time commitment is because the penalty for breaking one of these can be significant. It can start out around 10% and you know that's you put $100,000 in. You come back later and say,"Okay, I want that out, and you only get back $90,000.

BRIAN AKERS:

That's not. And yeah, find out how do they pay you? Like, do they pay you interest only? Like, if you ask for money, or do they give you 10% withdrawal rates?

Jeff Akers:

Right. And

BRIAN AKERS:

usually, the more liquid it is, the lower the rate. Yes.

Jeff Akers:

Right. Liquid

BRIAN AKERS:

is the ability to get your money back anytime you like

Jeff Akers:

without paying a penalty.

BRIAN AKERS:

All right, so do you own annuities that you just don't understand? Which we find a lot of people like that. Yes, at AKERS Financial Group, we can translate. No, we know exactly how to do this. I'm sorry, I was going to say got them

Jeff Akers:

all choked up.

BRIAN AKERS:

Well, well, we can translate annuities. Is what I'm trying to say. We can speak that language. We

Jeff Akers:

do speak annuity,

BRIAN AKERS:

and what that means is we can read a contract and interpret it and understand and explain how it works for you with all your choices. So, you what you would do is give us a call so we can review what you currently have, so you know what what's going on. You just do that for a free review by calling your phone number 833-946-7384,

Jeff Akers:

and the two that we've just described are the simpler ones. So there are more complex things out there that will happen. So we've covered

BRIAN AKERS: two:

one we don't like, which is immediate annuities, and one we do like,

Jeff Akers:

right? In the right circumstances,

BRIAN AKERS:

and that's called

Jeff Akers:

a MIGA or MIGA M Y G A fixed

BRIAN AKERS:

annuity.

Jeff Akers:

Fixed annuity.

BRIAN AKERS:

So fixed annuity. The word fixed means that the assets are under the guarantee corporation, and like we said in the first quarter, that guarantee is the assets of the insurance company. It's not FDIC anything like that. Does that make sense?

Jeff Akers:

It makes sense to me, but that's why we're here. So come talk to us. We can help it make sense to you as well.

BRIAN AKERS:

All right. So we've been talking about these annuities. This is what we do for a living. As we sit down and go over things from with people, we do your unique financial fingerprint. What that means to us is you bring in where you are, and we build the plan off of that. We don't want to make a lot of changes unless we're improving. Your situation. So what you do is you come in, talk to us, because we love to talk to you. We love to sit down with you. One of our team of advisors will sit down with you and talk about what's going on. Perhaps you've been sold something, regardless of whether or not you needed it or not. Not at AKERS Financial with us. Your retirement money follows your financial fingerprint. So give us a call at 833 win retire. That's 833-946-7384, or visit our website@akersfinancial.com. Would you retire without protecting some or all of your assets? We'll talk about this in a minute.

Unknown:

You're listening to a pre-recorded show. Welcome back to Winning in Retirement. Call 833 win retire now to schedule a visit with Brian and his team and begin winning in retirement. Once again, here's BRIAN AKERS.

BRIAN AKERS:

Indeed, welcome back to Winning in Retirement. Today's show is called "Two Annuities We Like and Two We Don't. I'm BRIAN AKERS, and here with me is Jeff AKERS. We're both financial advisors from AKERS Financial, and we're certified financial planner practitioners.

Jeff Akers:

Yep,

BRIAN AKERS:

for many years.

Jeff Akers:

Yes,

BRIAN AKERS:

I got mine in 1991.

Jeff Akers:

Right, you got yours a long time ago. Mine was more recent.

BRIAN AKERS:

Do you remember what year?

Jeff Akers:

No.

BRIAN AKERS:

I'm sorry, I shouldn't ask that question. I don't

Jeff Akers:

remember what year. It's on my card. Okay, absolutely.

BRIAN AKERS:

CFPs meant a lot to me over the years, because it's a process and a designation that matters, and I think it really is an important thing. It's a way of educating each and every advisor at AKERS Financial Group and growing into it and getting to a point where we have a process of financial planning. And I believe strongly that you shouldn't sell anything unless you've done a plan.

Jeff Akers:

Right, you have to have a plan. One

BRIAN AKERS:

of the coolest things in the industry is they've been changing and moving towards planning and finding out about the client and getting to know the client and the best interest of the client. These are all good things over the last decade that I would always wanted to do. This we were fiduciary before fiduciary got cool, right?

Jeff Akers:

Right. Yeah. But

BRIAN AKERS:

being CFP, you you agree to put the client first and understand their situation. Come with those those answers back to them.

Jeff Akers:

Yeah, that's one of the important things about being a certified financial planner practitioner is there's a fiduciary requirement that goes with that designation. So there were certain investments that we did that required us to be a fiduciary, but other investments that didn't, and the CFP umbrella covers all of

BRIAN AKERS:

it. And the ones that the ones that do not have fiduciary are commission based,

Jeff Akers:

right?

BRIAN AKERS:

And so when we're talking about annuities today, the word commission has to come up.

Jeff Akers:

That's right. That's how we get paid,

BRIAN AKERS:

right? So a commission is someone sells an annuity to you, they get a commission from the insurance company, but normally that means that you, the customer, are then locked in for a certain period of time.

Jeff Akers:

Yes,

BRIAN AKERS:

usually the more the period of time locked in, probably the higher the commission.

Jeff Akers:

Higher the commission, and probably higher the interest. Interest should be beginning.

BRIAN AKERS:

Should be higher the interest too, right? Right. There's lots of design when it comes to annuities. I like to compare to pizza.

Jeff Akers:

Yeah. In college, Brian delivered pizzas for Domino's. All right. So Domino's lows in Blacksburg, Virginia,

BRIAN AKERS:

Virginia Tech. The number one Domino's in the country was Domino's Blacksburg,

Jeff Akers:

and it was clearly number one because Brian was there.

BRIAN AKERS:

It was clearly number one because people ate pizza, and we worked incredibly hard. Between my sophomore and junior year, I think 15 pizza places opened in Blacksburg after they had a newspaper article about being number

Jeff Akers:

one. Everybody's like, "Let's get in on that.

BRIAN AKERS:

All right. So one thing I learned at Domino's was how to make a cheese pizza small in 15 seconds. Very simple. You slap the dough, put the sauce, cheese, you hand it to the cook. Very very simple thing. Cheese pizza is going to be what we covered last quarter. Fixed annuity. Okay. Put your money in. They give you an interest rates credited daily. You have five year period, three year period, and then you're done.

Jeff Akers:

Simple.

BRIAN AKERS:

That's simple.

Jeff Akers:

Okay.

BRIAN AKERS:

What we're going to talk about this quarter is not simple,

Jeff Akers:

less simple,

BRIAN AKERS:

less simple.

Jeff Akers:

Yeah,

BRIAN AKERS:

sorry, that would be harder, wouldn't it?

Jeff Akers:

Yes.

BRIAN AKERS:

Okay, try to keep this simple, but you're making it more simple. Not more simple. All right, sorry. Back to the show. The show is about two annuities we like and two we don't. So we really want to do the last one that we don't. But we're saving that one. We'll

Jeff Akers:

save that for last.

BRIAN AKERS:

We are, but we're going to talk about the one we like and the one that we've used a lot throughout the years.

Jeff Akers:

Yes, we have,

BRIAN AKERS:

and we're going to try to explain how that was started and how it grows. Can we do a little history on that?

Jeff Akers:

Oh gosh, what year was it that it started? 1995. 95. Okay, and it's called a fixed indexed annuity,

BRIAN AKERS:

or also known as equity index or equity linked.

Jeff Akers:

Used to be equity index, but the fixed, like Brian said earlier, fixed means that you know there's a guarantee against loss in there. The difference between this, a primary difference between this and the the fixed annuity, we talked. Earlier is that your interest isn't a set rate; it's based on an index like the S and p5 100, for example. If it goes up, you earn interest. If it goes down, you earn zero that year.

BRIAN AKERS:

Yeah. So, AKERS Financial Group, we serve as a broker for insurance companies and different annuities. And every few weeks we're shopping the rates. We have someone in our office whose job is to do that.

Jeff Akers:

Right, keep an eye out.

BRIAN AKERS:

We have someone in operations that tracks the annuity investments or sales that occur and make sure they're properly titled and properly set up. We review with people every year about their annuity and how it works, and we talk about that with them, how it works inside the portfolio design. Generally, at AKERS Financial Group, we're not a bond fund. We don't like bond funds,

Jeff Akers:

right? There's no maturity date.

BRIAN AKERS:

No maturity. One of the biggest problems when you have target date or bond funds that if you go from risk to no risk, why did you do that? You want lower risk, right?

Jeff Akers:

Right. You want to have no risk,

BRIAN AKERS:

and so the concept of dialing it back, we agree with that. But we want the safe money or protected money to have a form of protection to

Jeff Akers:

actually be safe.

BRIAN AKERS:

And so, a fixed annuity inside the guarantee corporation, backed by the assets of the insurance company, provide that. In the 1990s, 1995, the option trading allowed for insurance companies to take interest off of their investments. Like so, they you give your money to invest. The insurance company is going to take the risk, and then they're going to make something called a spread, just like the bank does. That spread is their profit. They invest the money in treasuries. They get interest. That interest is then spent on buying stock options, and then they say to the customer, "Hey, instead of us giving you 4% how about this? We're going to give you a piece of the S and p5 100,

Jeff Akers:

okay?

BRIAN AKERS:

And that S and p5 100 is going to be for one year, and at the end of that year, whatever it is on that day. Now that happens to be called point to point,

Jeff Akers:

right?

BRIAN AKERS:

The point you day you buy it, and the next year when it renews on that same day, is the market up or down that day?

Jeff Akers:

Yeah. If it's up, then you're going to earn some interest. If it's down, then you're going to earn zero. But you're not going to lose if the S and p5 100 went down.

BRIAN AKERS:

Yes. And so what they do in those kind of contracts is they will have a price of an option. Then their actuaries calculate what cap rate you can receive. A cap rate is how much you can make if the S and P went up. So if the S and P went up 12% and your cap was nine, you you get 9% The because they bought an option at nine doesn't mean they make the extra. They make their money based on the interest and the and what they spent on the option and the spreads that they design.

Jeff Akers:

Yeah, I've heard people say that means that the insurance company gets to keep the difference. Well, that that's not really true.

BRIAN AKERS:

Well, it means they made money on their calculations.

Jeff Akers:

Yes,

BRIAN AKERS:

and then the thing about losing, we can lose money if we get out early, and that that's a surrender period. The surrender period, the surrender charge get out early. When Jeff says not losing, that means that the money is not in the S and p5 100. It's in the insurance company. They're saying the interest is linked. The money mean by linked is based on a calculation based on an index. Some companies use the S and p5 100 or Nasdaq or Russell, and then there's lots of companies that have all kinds of different indexes. Some they made up their on them on their own, and you have to know what you're buying and what you're investing in. Is it one year, two year, nine year? What kind of period of time are you watching the market? Are you in bonds? Are you in money markets? Are you in a combination? There is so many choices out there. They get more and more complex. Back to my pizza idea.

Jeff Akers:

Oh, here we go. Cheese

BRIAN AKERS:

pizza, 15 seconds, right? But if you order extravaganza at Domino's, takes us longer to prepare.

Jeff Akers:

What's on the extravaganza? Well,

BRIAN AKERS:

you got to take a little bit of everything. Not everything. There's five, four items back then, and you spread them out a different certain way. Okay, and four or five items. I can't remember anymore, but takes a lot longer to make. You're

Jeff Akers:

adding stuff to the cheese pizza, right?

BRIAN AKERS:

So Stravaganza set price, but in index annuities, if you add different pieces to it, they could charge fees or spread fees. If you add something called income rider, that costs extra. I call that adding toppings to the annuity.

Jeff Akers:

You add one topping, there's one fee. Add a second topping, there might be another fee, and and so on and so forth.

BRIAN AKERS:

All right, so fixed index annuity. You're not in the stock market. There's an index involved. That index is how they credit you interest. That the best thing that we can tell you

is this:

if you have something like that, give us a call. We can review it with you. And by calling us at 833-946-7384, one of the team of advisors can actually help you understand what you have and explain how it works and how you can access the money if you need to, how it works down on the long term and in a portfolio. Because we do not believe that this should be all or even a major portion of what you have in your portfolio design.

Jeff Akers:

Yeah, like Brian said earlier, we can translate your annuity into English for you

BRIAN AKERS:

because. I said Noah, right? I know I had to translate, right? All right. So what we're going to do next is we're going to start talking about the one we don't like. So index annuities we do like. We feel like that's worked well, especially in volatile markets. The one we don't like, a lot of times on on the internet, you'll see I hate annuities or things like that. And what happens is when people say I hate annuities, they're talking about one of the four different types. Today we covered media annuities, fix, fix index. Now we're on the type that that is really what they're referencing when they say they hate annuities, and we agree we don't like them. But they're a tool; they might work in some situations. What are we talking about, Jeff?

Jeff Akers:

Variable annuities.

BRIAN AKERS:

All right, variable in what way?

Jeff Akers:

Well, you're invested in the stock market. We just talked about fixed indexed annuities. You're just using the stock market to determine how much interest you make, but you're not really invested in it. With a variable annuity, you're actually invested in the market: stocks, bonds. They they call them separately managed accounts. They're similar to mutual funds. They go up and down. You can pick what you're invested in, but if they go down, then your variable annuity loses principal, loses money.

BRIAN AKERS:

But the variable annuity is through an insurance company, and so variable annuity has fees, and that's one of the reasons we're not a big fan.

Jeff Akers:

Yeah, one of the fees is usually a death benefit; it's a mortality expense because they'll generally guarantee whatever you put into it. If you pass away, your beneficiaries will get at least that amount. Well, if you put $100,000 in and it drops to $70,000 and you die, that $30,000 the insurance company has to come up with. That's that's like life insurance. So they charge a fee for that.

BRIAN AKERS:

What does that fee usually work out to be?

Jeff Akers:

It can be right around 1% Yeah,

BRIAN AKERS:

1% to 1.2. So that's one of the components of fees. What's some more fees?

Jeff Akers:

Well, you might have income riders. You might have other death benefit riders to jack up the amount of death benefit that there would be.

BRIAN AKERS:

You have the contract fee. You have the sub advisor fee.

Jeff Akers:

Yeah, all those investments that we talked about-they all have expenses built in. Years ago, that's all

BRIAN AKERS:

charged. Yeah, it's

Jeff Akers:

all charged one way or another. And I was looking years ago when there was a contract that the the fees, when you added them all up, are right around 5%

BRIAN AKERS:

Wow, that's on the high side.

Jeff Akers:

That is the high side. So

BRIAN AKERS:

2232, to four. Five was five was an older one, but the idea is a variable annuity. When you hear the word variable, you think variable expense. Understand that if the portfolio has to make four just to cover expenses, how risky do you need to be with your money? We don't want to do that in our retirement years because we know the best part of retirement is getting our time back, where we get to relax, where we're not worried about over fees and not making any money on one of these, what we need to do is decide how we're going to use our time in retirement. We need to know how to relax. The way we do that is by talking to someone at AKERS Financial Group, because it's so easy to begin winning in retirement with us. Go to our website at akersfinancial.com, scroll to the schedule meeting section, and let us know you'd like to meet with one of our financial advisors, our team of advisors, right there. That's akersfinancial.com, or call us at 833 when retire 833 W I N R E T I R E. We'll give you a call on Monday to schedule your free in person meeting. So go to AKERS financial.com, or call us at 833-946-7384 to start planning for your retirement now. Would you use a hammer to cut a board? We'll talk about the tools you need in a moment.

Unknown:

You're listening to a pre-recorded show. Welcome back to Winning in Retirement. Call 833 Win Retire now to schedule a visit with Brian and his team and begin Winning in Retirement. Once again, here's BRIAN AKERS.

BRIAN AKERS:

Welcome to Winning in Retirement. This is our fourth quarter. I'm BRIAN AKERS. Here with me today is Jeff AKERS. Both certified financial planner practitioners. I've just been working beside me for 26 years, I think.

Jeff Akers:

26 years next month.

BRIAN AKERS:

Yeah, but you have been working beside me at a construction site about 30 some years ago, I think.

Jeff Akers:

Wow, that's back to high school. I remember my first

BRIAN AKERS:

job. I was digging in basements, and I realized if I got a friend of mine to take the job, I could move up, and I could learn how to do carpentry work while you were digging in basement.

Jeff Akers:

Yeah, that's kind of Brian's motif: get me to do the stuff he doesn't want to do. And that's why I hired you for AKERS for Natural Group

BRIAN AKERS:

over 25 six years ago. All right. So the reason I bring up that is our our question coming in is this, Jeff, would you use a hammer to cut a board?

Jeff Akers:

No.

BRIAN AKERS:

Have you ever used a hammer to cut a board?

Jeff Akers:

Oh gosh, I

BRIAN AKERS:

have. Yeah.

Jeff Akers:

Not a thick board, but a thin board. But not for

BRIAN AKERS:

not for a finished work. But oh no. If you're trying to break a board for a fireplace, hammer it's pretty fun, right?

Jeff Akers:

But if it's like a two by six or something, that's going to be hard to break with a hammer,

BRIAN AKERS:

right? So the tool of the hammer is a good tool

Jeff Akers:

for a nail, for a

BRIAN AKERS:

nail. But to saw, you'd probably use something called a saw,

Jeff Akers:

right?

BRIAN AKERS:

And now I like power.

Jeff Akers:

Power saws would be fantastic. Fantastic

BRIAN AKERS:

handsaws are needed to be delicate and to do your special trim and everything.

Jeff Akers:

Right to make it look nice. Did you

BRIAN AKERS:

ever get to do trim work?

Jeff Akers:

Oh no, I carried the trim work in.

BRIAN AKERS:

Yeah, that's right to me. No, it was beautiful to learn carpentry. I love it. I think the trades is one of the greatest jobs right now for people. The trades are making more money than people coming out of college by double.

Jeff Akers:

Yes, they are. We've been

BRIAN AKERS:

seeing with our clients, and we

Jeff Akers:

need them

BRIAN AKERS:

absolutely. I don't think AI replaces that.

Jeff Akers:

No, I mean

BRIAN AKERS:

you've seen the printers that print buildings, though. I think that's fun to watch.

Jeff Akers:

Yeah, I have seen that.

BRIAN AKERS:

But sorry. So in the fourth quarter here, we're talking about a hammer to cut to cut a board. So the tools that we talk about, investing tools. Today's show is called two annuities we like, two we don't. These are tools in portfolios. You don't say, oh, all tools are bad. We don't say all tools are good. There's a combination of tools got to be used properly, and they have to fit you, the client, not just be something on a shelf, yes. There are people that are insurance-only people. They they only sell insurance, and they would probably only sell sell the annuity side.

Jeff Akers:

Yes,

BRIAN AKERS:

and there's people that will use all kinds of different sales ways of getting you to buy annuities. And we believe that you got to do planning to see if one fits, and if it fits your process. Then you buy an annuity. If not, you don't need to buy an annuity. You need to buy what your portfolio requires when it comes to your income needs. The higher income, the the lower risk that you need for your portfolio. The more likely you should have some type of fixed annuity.

Jeff Akers:

If you need money in the next year or the next five years, even you you don't want to take market risk with that money because you're going to need it to live on.

BRIAN AKERS:

And so, annuities, income riders became ways to stretch this money for a lifetime. There's a Wharton study back in 2007 on how to make a portfolio outlast you when you have longevity. As people are living into their 90s, will their money last that long? And one way is to take a portion to something that ties into lifetime guarantees. So income writers on top, like a extra piece of pizza or extra topping on a pizza, you put that on some of the annuities that you buy, and then that ladders out and gives you income that can grow over time.

Jeff Akers:

Now there are you mentioned people that just sell annuities, and there are certain phrases that they like to use. Do you do you want to go over a couple of the phrases that they use?

BRIAN AKERS:

Well, it's hard when you're talking to someone and you're talking about your finances, and they bring up topics like you want something guaranteed income or reliable income, or they say things such as, "Hey, you might get a 10% return, a 9% return. I I brought up early in the show about annuities with two eyes. We need to look at it. We need to see the contract when people are are selling or presenting to you, and they use certain terms. And there's lots of terms out there, but I just try to use some basic ones. But the idea of if they say roll up, you need to understand what that means. If they say that that it's guaranteed, you know what that means. When they talk about guaranteed period or surrender periods, surrender period being 1620, years, you got to question why? Why am I doing that? Why so long?

Jeff Akers:

Right.

BRIAN AKERS:

These these are just some of the warnings. There's so many things to be careful of.

Jeff Akers:

Yeah, you want to be careful with folks that just use these phrases, but they never talk about what the reasons not to do. Like the purpose of a

BRIAN AKERS:

tool.

Jeff Akers:

Right.

BRIAN AKERS:

I mean, like if you read some of your booklets that come with your chainsaw, there's certain things you can do, but you shouldn't be doing your don't you do your electric with the chainsaw. Right, I learned that. Yeah, yeah. So, so the

idea here is this:

and two annuities we like. We like fixed annuity and fixed index annuities in our planning for pre and and retired people to help them have a portion to replace their bond funds and to replace it to get us a guaranteed income that'll tie into what we need to do over time.

Jeff Akers:

Okay, and then there's two that we don't really like. One is the immediate annuity, and the second is the variable annuity. Almost two ends of the spectrum. One of them, you give the insurance company a bunch of money, you get money back while you're alive, and then that's it. And the other one, you might actually lose money if the market goes down.

BRIAN AKERS:

And they have a lot of fees, and that's why a lot of people say they don't like annuities, but in reality, they don't like variable annuity. And we do help people with variable annuities, being a licensed stockbrokers. We take over as broker of record and guide them through the policy to take advantage of all the clauses because we use our two eyes to look at the contract,

Jeff Akers:

right? How to use

BRIAN AKERS:

it and make sure they do the right thing. Now, when I'm thinking about annuities and the payout, I always think about annuities in two ways. One that is for growth inside a portfolio, sort of like the bond replacement or bond fund replacement. Those are annuities that don't have the extra. They're more my cheese pizza idea. They give us an index interest tied to the index every year. You see how you did. When the market goes down, you don't go down. It's it's fixed index annuity, but simpler. Usually five year or seven year, not that far out. You can get eight, nine, 10% depending on the month and the policy and the company, be careful to get by an A-rated company or better. The other way of annuities that we look at are income design annuities, where we need to design enough income to fulfill your need, and so we got to make sure we're doing that for income now or income at your RMD age, 73 or 75, because you have to take money out anyway. Why not have it guaranteed for your life, so you can let the rest of the money grow in all the portfolios that we design and actively manage.

Jeff Akers:

Right, and then you're not worried about if your stock portfolio went down because you're not depending on it to live on. The things that you're depending on, we want that to be safe. We want that to be guaranteed. The

BRIAN AKERS:

annuities can be complex. That's why you got to look at them and read them and understand them. What we do and what we offer you, if you're listening, is we'll we'll review what you have and explain what you own and help you through the process of using that over time. The annuities are definitely something that, how do I say it? The best way possible. Annuities are a tool. The annuity tool is for a portion of your portfolio design. It should not be for all of your money, even if someone's recommending that.

Jeff Akers:

Right.

BRIAN AKERS:

And if you're being recommended that, a recommendation is to walk away and go get second and third opinions from other people.

Jeff Akers:

Right. When you're a hammer, going back to the tool analogy, everything looks like a nail, but not everything is a nail. So, don't use one thing for everything that you have.

BRIAN AKERS:

Now, out there in the market, there'll be some people that say we don't like annuities because there's commission, and then they say,"Well, we we're we're on your side of the table because we charge fees based on value. But then you look at it; they're charging a fee for everything, and we're totally against that. Also, I think you should only get charge a fee for what you actively do.

Jeff Akers:

What's actually being managed,

BRIAN AKERS:

right? An annuity or fixed treasuries. Why should a fee be charged on top of that? Right. When when you're basically someone makes 4% if you charge a 2% fee on that? They're making.

Jeff Akers:

They're only making 2%

BRIAN AKERS:

Yeah, that good subtraction there. Yeah, I

Jeff Akers:

can do math.

BRIAN AKERS:

I tried to set you up slowly there. Kevin simple.

Jeff Akers:

Well, thank you.

BRIAN AKERS:

You were a psychology major to start.

Jeff Akers:

Yeah. No, no, you're

BRIAN AKERS:

engineering first.

Jeff Akers:

I started with engineering. We won't go there. Yeah. Went to psychology. Got a master's in marriage and family counseling, and now I'm a financial planner.

BRIAN AKERS:

And that's probably where you use marriage and family counseling better than ever.

Jeff Akers:

I do. That is true.

BRIAN AKERS:

And we're counseling us about two annuities that we like and two that we don't. So when you're listening to a show like this, you got to say, "Well, does this matter to me? The reason annuities matter, and when, in my opinion, is that we're trying to design lower risk things in your portfolio, where if all goes wrong, something's going to be left standing, and there are pieces that can do that through money that's FDIC insured and through insurance annuities. We think you can provide some protections of your money that way.

Jeff Akers:

Yeah, sometimes the when the market does really well, people get all excited and they think it will always do well. But the market does not always do well. There are times when it goes down, and having a fixed or a fixed indexed annuity protects against that loss.

BRIAN AKERS:

When you're looking at your portfolio and you're talking to the advisor, and they say, "Well, we've had incredible years the last three, and now you look at the stock portion is higher than it should be in your allocation, and then you got to take some winnings off the table sometimes and buy and put in something protect it. Now, what is that going to be?

Jeff Akers:

Well, that could be a fixed annuity. That could be a fixed indexed annuity. If you're taking income, it could just be in cash that you're going to use for that income stream for the next year or two.

BRIAN AKERS:

Now, target date funds would reallocate and invest in bonds funds, and they'd be investing internationally.

Jeff Akers:

They would be buying more and more bonds, but again, we talked about that's not really protected.

BRIAN AKERS:

Yeah. So the idea is this: your portfolio needs to be designed based on you, your needs, your needs as you get close to retirement is basically building your cash flow retirement to make sure you have the money you need, and then you can give your purpose, your money purpose. And by doing that, we can then dictate how to invest. Some clients don't need the money. We can then take the risk. But I gave advice just the other day. It's like why? Why are you taking risk with your money when you don't need to take the risk?

Jeff Akers:

Yeah. What What is your goal for that money? If

BRIAN AKERS:

they just want to beat your friend and rates of return, let's have a small account for that. Let's not risk at all, but let's build a portfolio that can weather the worst case situations that come at us because we never know everything that's going to come to hit

Jeff Akers:

us. Yeah, we. I talk about paychecks and. Play checks and your paychecks-that's money that has to be there because it's paying the basic bills. So that can come from things like pensions, social securities, or the income riders like we've been talking about with fixed indexed annuities. It's guaranteed income that's for you, for your spouse that can last the rest of your life.

BRIAN AKERS:

Yeah, so that's very good, Jeff. I appreciate that.

Jeff Akers:

You're welcome.

BRIAN AKERS:

Thank you, Jeff. My pleasure. That's Jeff AKERS, AKERS Financial Financial Advisor. Today we covered two annuities you like, two annuities we don't. We do look forward to meeting with you. We want you to win in your retirement by taking this opportunity to begin planning with us at AKERS Financial. To schedule a free meeting with one of our team of advisors, go to our website at akersfinancial.com. Scroll to the schedule meeting section and let us know you'd like to schedule a free meeting right there. That's acresfinancial.com, or call us at 833 when retired. That's 833 W I N R E T I R E. We'll give you a call on Monday to schedule your free in person meeting with one of our team of advisors start planning for your retirement now. Go to AKERS financial.com or call us at 833-946-7384. Thank you for listening. I'm BRIAN AKERS from AKERS Financial Group, and we want you to be winning in retirement.

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You've been listening to Winning in Retirement with your host BRIAN AKERS of AKERS Financial Group. AKERS Financial Group offers securities through Arcadius Capital, an SIPC and Finra member firm. Advisory services are provided through Arcadios Wealth. AKERS Financial Group and Arcadios do not share any common ownership. Neither Arcadios nor AKERS Financial Group provides tax or legal advice. Advice given on winning in retirement is general in nature, and one should seek further advice from their financial advisor, broker, attorney, and/or tax accountant before investing. Be sure to read each prospectus carefully to understand all the risks associated with each investment. Examples and scenarios shared are meant to be for illustrative purposes only. Past performance is not indicative of future results.