4.21.23: Audio automatically transcribed by Sonix

4.21.23: this mp3 audio file was automatically transcribed by Sonix with the best speech-to-text algorithms. This transcript may contain errors.

Producer:
Any examples used are for illustrative purposes only and do not take into account your particular investment objectives, financial situation or needs and may not be suitable for all investors. It is not intended to predict the performance of any specific investment and is not a solicitation or recommendation of any investment strategy.

Producer:
Welcome to the Active Wealth Show. With your host, Ford Stokes. Ford is a fiduciary and licensed financial advisor who places your needs first. He'll help you protect and grow your wealth. The Active Wealth Show has grown because activators like you want to activate their retirement planning with sound tax efficient investing. And now your host, Ford Stokes.

Ford Stokes:
And welcome to the Active Wealth Show Activators on Ford Stokes, your chief financial advisor. I've got Sam Davis, our executive producer, with us. Sam, say hello to the folks this weekend.

Producer:
Welcome to the weekend activators. Hope everybody's out there enjoying spring time in Atlanta, Georgia, and excited to be on the Active Wealth Show. Once again, we've got important information just like we do every single week. And if you missed last week's show or any of the shows that we've put on the air here in the month of April, check out our podcast feed. Wherever you listen to podcasts, you can go to your iPhone, check it out on Apple Podcasts. You can check it out on Google Play or Spotify or even just go online to ActiveWealthShow.com you don't always have to be available when the show is on live. We love that our listeners are listening live right now, but for those who can't make it, check out the podcast and get caught up on the recent shows.

Ford Stokes:
We also just want to say good luck to the Atlanta Braves this weekend against the Houston Astros at home. Hopefully you guys can gals can get out there to see a game and root on our Atlanta Braves. They have had a pretty great start to the season. Now on this week's show. We're also going to talk about why now could be the best time ever for fixed indexed annuities. We're also going to talk to a fixed indexed annuity wholesaler. His name is Josh Lumi. He works with a married life and Vertical Vision Financial Marketing, which AmeriLife and their affiliates, they wholesale billions and billions of dollars of fixed index annuities. I think you're going to like what you what you're going to be able to learn from Josh He's he's just an absolute expert and we want to make sure that we get you get a lot of time with Josh today so you can understand why really now may be the best time to invest in fixed indexed annuities. And also there's one product that's been very successful out there that a lot of people are purchasing right now that we want to make sure the listeners could hear about it right? Also, listen, for our listeners who've been listening to us for a long time, we appreciate you. We appreciate our activators out there. Activators are folks who listen to the active well show. They're looking to build a successful retirement. They're looking to not have to watch the stock ticker all the time. They're looking to build a tax efficient, fee efficient and market efficient portfolio. And that's what we're talking about on this show every single week. And sincerely appreciate all of the activators out there listening to the show and also making us the number one listen to radio show on AM 920.

Ford Stokes:
The Answer on the weekends. We don't take that lightly. We sincerely appreciate you as an activator. Thanks for listening to the show. And also we encourage you to pick up the phone and give us a call at (770) 685-1777 again (770) 685-1777. If you want to get a free financial consultation, you want to get that free portfolio analysis, free financial plan to your 95th birthday and also a free financial plan to your 95th birthday with our recommended portfolios that also includes a Roth ladder conversion plan. A couple of things here, folks. If you don't know what an expense ratio is, which is the expense that are internal to your portfolio. They don't necessarily show up on your statements, but they're talked about in prospectuses on the mutual funds you may hold. I would encourage you to pick the phone up and give us a call at (770) 685-1777. Also, if you don't know whether you're going to have a positive retirement income surplus or you're going to have a negative retirement income gap, then you should definitely pick up the phone and give us a call at (770) 685-1777 or visit ActiveWealth.com and click that schedule a consultation button in the upper right corner and you'll get booked directly to my calendar. I'll be happy to work with you. We'd love the opportunity to talk just to you and we'll do everything we can to make sure that you can build a successful retirement plan. So we've kind of gone over what we're going to talk about today and. We're going to have Josh Lumi starting in segment two. Sam. So, Sam, why don't you share with the listeners our financial wisdom quote of the week.

Producer:
And now wholesome financial wisdom? It's time for the quote of the Week.

Producer:
This week's quote of the week comes from the Oracle of Omaha, Warren Buffett. And Warren Buffett once said that risk comes from not knowing what you're doing.

Ford Stokes:
Yeah, that's one of the greatest risks out there. And if you're trying to do it all on your own and you think you've got it handled, but you've got questions like, what am I going to do? What's going to happen when I pass away? How's my wife going to deal with things? I would encourage you to pick the phone up and give us a call at (770) 685-1777. And we're happy to give you that free financial consultation. It's a 1000 hundred dollars value at absolutely no cost to you. It's absolutely free. We do that for a reason because we want to make sure that you can make an informed financial decision about your retirement future. Because, listen, you worked really hard for your money all those years, 30, 40 plus years. You also worked really hard to save it. And it probably was harder to save it than it was to earn it. And you are to be congratulated. But also we want to make sure that your money is going to be working as hard as you did during retirement. So we're not saying you need to be working hard during retirement. We don't make sure that your money is working as hard as you did during all of those earning years.

Ford Stokes:
So there are strategies behind it and it's multifaceted. Also, you ought to look to try to get more tax efficient with either Roth IRAs or life insurance or both. And we can help you do that. You also ought to be generating retirement income. That is, the principal is going to grow tax deferred, and you only pay taxes on the income that you're withdrawing from the from this investment product. If you've got questions about that, you ought to call us at (770) 685-1777. You also need to figure out how you can protect your money against what's going on with the financial banking crisis, with the failure of Silicon Valley Bank, with the current resident in the White House right now. He's not a president that I support. I did not vote for Joe Biden. And he's also somebody that really concerns me. And, you know, we've got to build our plans accordingly to inspect what we expect and to better protect and grow your hard earned and hard saved wealth. And we're going to go into now. Why now really could be the best time ever to invest in a fixed indexed annuity for a portion of your retirement portfolio.

Producer:
Well, for the first item on this list of reasons why now could be the best time ever to invest in a fixed indexed annuity is recession fears. People concerned about the market going backwards. And I know you're getting calls every week from your clients and prospective clients who are concerned about what another, you know, another recession could do to their retirement savings.

Ford Stokes:
Yeah. I mean, the folks that retired in 2000, it's really frightening. They went 13 years with no growth overall over those 13 years net in the S&P 500. Can you imagine going 13 years with no growth consecutively in your retirement? I mean, it represents like 43% of a 30 year retirement. It's going to make retirement really difficult. And we want to help people with all those concerns. We're getting calls, like you said, every week from clients and prospects who are concerned about the possible impact another recession could have on their retirement. Many Americans lost 20% or more in their retirement accounts in 2022. People who have fixed indexed annuities didn't lose any money in that portion of their portfolio. With all the concerns in the global economy and talks of another recession, are you prepared to enter retirement without a solid income plan? Remember, retirement is more about income than it is about building just one big, huge number for your nest egg. When you invest in a fixed indexed annuity, you effectively put a floor on that portion of your portfolio, meaning that you can't lose money. The value can only go up, never down. And I want to talk to all the listeners out there as you're driving around. I'm getting calls from people right now. That are concerned about depositing money into their checking account.

Ford Stokes:
If you look back 18 months ago or 12 months ago, would any of us think that we would have concerns about depositing money in our bank? And I'm not going to get into specific names of banks or anything like that, but I'm just telling you, some people are like, should I be worried about depositing? Should I be putting money under my mattress? Well, what I would encourage you to do is invest a portion of your assets that's going to pay you a monthly check. And you can never lose your principal and you can get market like gains without market risk. And I think you really ought to consider that. A lot of people are concerned about banks. Again, we've we're going to talk about this on on the next segment with Josh Leumi with the MER life and and I really hope you come back for that. But when we come back, we're going to talk to Josh Leumi with the MER Life and Vertical Vision Financial marketing. They wholesale billions and billions of dollars of fixed indexed annuities and indexed universal life policies. I think you're going to want to hear what he has to say about how a fixed indexed annuity could fit within your overall retirement portfolio as an element of a successful retirement for you and for your spouse. You're listening to the Active Wealth Show on AM 910. The Answer? Come right back for that interview with Josh Leumi with the MER Life and Vertical Vision Financial Marketing.

Producer:
Fixed annuities, including multiyear guaranteed rate annuities, are not designed for short term investments and may be subject to restrictions, fees and surrender charges as described in the annuity contract. Guarantees are backed by the financial strength and claims paying ability of the issuer. Charlie Kirk here. If you're concerned about your investments.

Charlie Kirk:
Rising taxes from the Biden administration, then I encourage you to listen to the Active Wealth Show hosted by my good friend Ford Stokes right here on AM 980. The Answer. Listen to the Active Wealth Show Saturdays at noon and Sundays at 11 a.m. The Active Wealth Show right here on AM 980. The Answer Investment Advisory.

Producer:
Services offered through Brookstone Capital Management, LLC, BCM, a registered investment advisor, not an actual client of active wealth management.

Ford Stokes:
And welcome back to the Active Wealth Show. We're here for segment two, and I've got a very special guest that we're going to talk to here during segment two. I've got Josh Leumi with AmeriLife and Vertical Vision Financial Marketing. Josh, welcome to the Active Wealth Show.

Josh L. :
Hey, Ford, Thanks for having me.

Ford Stokes:
Yeah, it's it's our pleasure. So, Josh, you know, you guys in a married life, you all wholesale billions and billions of dollars worth of fixed indexed annuities and also a whole bunch of indexed universal life policies. Both of those are market linked products. You work with multiple carriers. What are you seeing in the marketplace post the Silicon Valley bank situation? Are you seeing an uptick in annuity annuity orders? Are you seeing an uptick in demand for fixed indexed annuities? And why would you think that is?

Josh L. :
Yes, we are. We've seen an uptick on just clients calling in and asking questions. They may have been in the process already and just were unsure. And the bank fiasco that's going on right now is put a lot of awareness out there that there's more than one place that you can safely invest your money or maybe even safer with with the insurance companies.

Ford Stokes:
Yeah, what's interesting to me is people always really defensive and do a great job of defending FDIC and they're quick to say, well, there's never been depositors that didn't get their money back that were FDIC insured up to $250,000. Well, that may be true, but there's been government bailouts that just most recently there's a government bailout of Silicon Valley Bank even above the $250,000 level. But what I find it interesting is people are like, oh, yeah, you know, banks put your money in banks. It's fine. Put your money in a bank CD But it's a 10% financial reserve requirement. It's actually 3 to 10% if the bank has over 100 million in deposits. Fdic requires them to keep 10% of deposits on hand so they can actually give money out to their customers. But it's interesting because fixed indexed annuities have a 100% financial reserve requirement, and they're regulated by the states, not regulated by the US government. And. For me, I would just feel more comfortable investing in a 100% financial reserve product versus a 10% financial reserve fractional lending product.

Josh L. :
Right. No, I understand 100%. And it's actually it's more than 100%. A lot of these highly rated carriers will actually have 105, 109% solvency ratios. And so it's just an even bigger layer of protection there.

Ford Stokes:
Yeah, that's helpful. You know, I'm just glad to know that there is some place where you can put your money that has got that type of financial reserve requirement when they do reserve money. Josh, could you talk a little bit about what annuity companies put your hard earned and hard saved money into? Let's say somebody is going to invest into, you know, a $400,000 annuity? Where are they putting that money?

Josh L. :
Yeah, they're investing that into safe and secure type of investments like like bonds and treasuries and and then they're turning around and taking those profits and they're leveraging them into higher yielding investments.

Ford Stokes:
Gotcha. And also, Josh, I know you you and I are working on a book together, and we're seeing that there are higher payouts today than they were in the past over the last 20 years, even specifically over the last 9 to 10 years. How and why are annuity companies able to pay annuity owners or annuitants more money today than, say, they did in 2014?

Josh L. :
Yeah, the the main reason is just the interest rate environment is is so high it's it's higher than it's ever been in the last decade since the more modern annuities have come out and have actually we have a good track record on their on their performance. The other factor that comes into this that doesn't get talked about as much is just advances in technology. It's helped the insurance companies lower their operating costs and be a lot smarter with their investments.

Ford Stokes:
Now, that's a really good point. I hadn't even thought about that. I can see them have not having to spend all the money in in postage to send monthly statements. They're sending out a one an annual or, you know, you know, a statement every two years if they've got a two year protection period and therefore it's reducing the amount of operations staff and it's reducing the amount of postage and print costs and everything else, that makes sense. Also, Josh, how do you see an annuity fitting into a retiree's overall portfolio and retirement plan? I mean, you guys are wholesaling billions of dollars. I'm not asking you to be a financial advisor for every one of our listeners here today, but what I am asking is potentially how can a fixed indexed annuity fit into an overall portfolio? We're not saying it needs to be the the entire amount of a portfolio. Obviously, but how can it fit within a retiree's portfolio to build a sound and successful retirement plan for that listener?

Josh L. :
Annuities can be a great way for retirees to build a secure, stable foundation for retirement. They can provide safety growth. They can be used to provide a steady income for for their entire retirement and even for both spouses. And some annuities also address long term care needs. So there's several ways that you can fit an annuity into your your overall retirement plan.

Ford Stokes:
Yeah, some of those some of those products you've got home health care doublers right. For the long term care side which do not include medical reviews. And if somebody can't meet two of six activities of daily living down the road during their retirement years, then that there's something called a home health doubler where it actually doubles the income. If you are kind of infirmed at home and you need home health care, is that is that pretty much how it works?

Josh L. :
Yeah, that's how that works. There's also annuities built for growth that will give you leverage on your premiums, sometimes 2 or 3 times the amount of premium you put in to pay for those long term care costs and come with certain tax benefits as well.

Ford Stokes:
Gotcha. Let me ask you, this is going to be for the pre-retirees and retirees, Josh, So should a pre retiree with an IRA or an old orphan 401. K, you know, so many of us have multiple jobs. A lot of, you know, a lot of people, you know, they change jobs every few years. And with COVID, a lot of people did change jobs. But should a pre retiree with an IRA or 401. K invest in an annuity in their 40s or 50s even?

Josh L. :
The Answer is probably. You know, there's been a debate over the last decade of should you invest in an annuity or go with like a 60 over 40 type of portfolio. And there's actually been multiple studies on how annuities, specifically the fixed indexed annuities have performed over the last decade compared to other proven portfolio mixes that are alternatives for for that age range. So that in mixed with the fact that somebody in their 40s and 50s with qualified retirement plans like that shouldn't be tapping into that until they're at least 59.5. It makes the annuity a savvy move for a lot of those clients.

Ford Stokes:
And they can implement a rollover, right? So it's it's not a tax event. So they've got that IRA and they can roll that into a fixed indexed annuity. That would be an IRA, Ira based annuity. And so there's no tax event and that money continues to grow tax deferred, just as their IRA would have.

Josh L. :
Right.

Ford Stokes:
Gotcha. So also, Josh, you mentioned financial solvency rates. I'm not going to dive into that, but. Safe to say that if they've got more cash on hand than their liabilities, that's a really good thing. And sometimes that's very difficult with banks for fractional lending situations. Let me ask you, why is it important for a retiree or even a pre retiree to invest into an annuity with a highly rated life insurance company or annuity company?

Josh L. :
Yeah, about half of the annuities that are being sold or purchased by the consumer are there to address an income need and generally for their lifetime. So when you're when you're thinking about investing in your future like that, you want to be with a carrier that's been around for a long time, is very financially stable that you know is going to be with you through your whole retirement.

Ford Stokes:
Right. Yeah. So what we also say is you want to have an annuity carrier that's got more cash on hand so they can afford to pay you your money back. Sure. And and and that's we only work with highly rated carriers. You know, we've never been sued. That's why. Because we take extra special care here at Active Wealth Management to make sure on that. And last question for this segment. Some people say that annuities are too good to be true. Josh, how can annuities deliver healthy payouts while also growing with market like gains and also without market risk? Can you just quickly just share? Sure. Really, how do annuities work?

Josh L. :
Very carefully. It's no secret that the insurance companies make their money by hanging on to the policyholders money as long as they can, and they hold those deposits and secure investments, like I mentioned earlier, like in bonds. And then those are going to provide steady returns over time. And then they're going to dynamically leverage that profit into higher yielding investments.

Ford Stokes:
Gotcha. When we come back from the break, Josh, can you just stick on for one more just early part of next segment, I want to ask you about a specific fixed indexed annuity product that is getting purchased more often than most of the other annuity products out there. And I think our listeners are going to want to hear about that product right when we come back from the break.

Producer:
Any bonuses mentioned may be subject to additional restrictions and regulations based on the offering annuity company. You may not receive the bonus if the contract is fully surrendered or if traditional annuitization payments are taken and if the policy is partially surrendered, it could result in a partial loss of bonuses because these are bonus annuities. They may include higher surrender charges, longer surrender charge periods, lower caps, higher spreads, and other restrictions that are not included in similar annuities that don't offer a bonus feature.

Charlie Kirk:
Are you concerned about the Biden administration, how rising taxes could negatively impact your retirement? Then I encourage you to talk to Ford Stokes and his team at Active Wealth Management. Ford and his team of experienced financial advisors will help you understand the fees and risks involved with your current portfolio. Simply visit ActiveWealth.com to book your free financial consultation and tell them Charlie Kirk sent you.

Producer:
Investment Advisory Services offered through Brookstone Capital Management, LLC BCM a registered investment advisor, not an actual client of active wealth management. So you know where you are now and where you want to be in retirement. So how do you plan to get there? I'm Matt McClure with the Retirement.Radio Network Powered by Amara Life.

Jack N. :
Do you have any other questions for me, Counselor?

Producer:
There are a lot of questions to ask yourself when you start your retirement plan. Questions like When should I retire? How much money will I need? When should I claim Social Security? What about health care costs and taxes? In retirement, this complicated puzzle means you're probably going to need some help coming up with a smart retirement plan.

Ford Stokes:
If you want to retire successfully, you really need to plan early. You know, Inspector, you expect and get prepared. Putting a plan in place now while you're still working is a great idea.

Producer:
Ford Stokes is founder and president of Active Wealth Management. Once you find a financial professional you want to work with, they can help you Answer all the questions you may have.

Ford Stokes:
Back to what Warren Buffett said. If you don't find a way to make money while you sleep, you're going to work until you die. So we need to do everything we can to figure out a way to make money while we're sleeping. We talk about this human capital versus actual capital. When you're young, you have a lot of human capital, you've got a lot of left, a lot of room left, a lot of capital left in your career. Right. But at the same time, a lot of people that are older let's say you're 65, 70 years old, you don't have a lot of human capital left, but you should have a lot of capital that is making money while you sleep. And if you don't, then you didn't make the right decisions.

Producer:
There are also some retirement costs you may not have considered yet. Long term care, for example. Did you know it's not covered by Medicare? What about home renovations? If you decide to stay in your home instead of moving into a facility? Your home might need some updates to ensure you're safe and comfortable. And those are just the tip of the iceberg. So do you have a fiduciary financial advisor or professional to help you wade through the complicated retirement planning process? That is a key question to consider. If you want to make the most of your hard earned money with a Retirement.Radio Network powered by AmeriLife. I'm Matt McClure.

Ford Stokes:
And welcome back to the Active Wealth Show Activators. I'm Ford Stokes, your chief financial advisor. And I've got Josh Lumi with a major life and vertical vision financial marketing. They are one of the largest wholesalers of fixed indexed annuities and indexed universal life policies in the country. And we've got one more question for you, Josh, Really appreciate all of your time and the last segment. You and your company in Married Life and Vertical Vision Financial marketing, wholesale, billions of dollars in fixed indexed annuities, but you also have a proprietary product that is exclusive to your company that also and the advisors that are appointed to work with you in working with Nationwide. And they've got a you guys in conjunction with Nationwide, you have a product called the Peak ten. It's a fixed indexed annuity that is one of the highest purchased annuities in the US today. And you know, I'll just speak personally, you know, from my perspective, we are super proud to be able to offer that annuity to our prospects clients and to the listeners here on the Active Wealth Show. Also Activators. If you want to get more information about the nationwide peak ten annuity after you hear Josh talk about it, all you got to do is reach out to us at ActiveWealth.com that's ActiveWealth.com and click that schedule a consultation button in the upper right corner. We're happy to give you a free annuity x ray report absolutely at no cost to you. But Josh, can you share some of the key features and benefits of the peak ten and how it could positively impact our listeners retirement if they should buy one soon? Yes.

Josh L. :
The peak ten is is a great product from nationwide. They're an A rated mutual carrier. And there's a few ways you can use this annuity to fit into your retirement portfolio, one of which being just a very highly competitive guaranteed income for life that could cover you or you and your spouse. And and they get there by having a really high initial bonus to that income base of 20%. And then for every year you wait to turn on income, you're going to earn an additional 8% to that to that income base. So when you're ready to start taking those payments, they're going to be very, very competitive.

Ford Stokes:
Can you talk a little bit about what participation rates have been in the past and what they are now? And and and and specifically around that, around peak ten?

Josh L. :
Sure. We're seeing participation rates with the peak ten as high as 300, 325%. And if we go back a year in time, those participation rates were were over 100%. But they were they were in between 100 and 150. And because of the interest rate environment rising so rapidly, the insurance companies have been able to increase their rates along with that. And so now we're seeing just some of the most highly competitive rates in the last 10 or 20 years. And and not only that, the account growth is tied to two well known crediting methods like this S&P 500, AllianceBernstein, JPMorgan, BNP. And so those institutions have been around for a long time.

Ford Stokes:
For those of our listeners out there, you're driving around, you're heading to Kroger or Publix or Home Depot, or you're going to a grandkids baseball game or soccer game, or you're going to a dance competition or a cheer competition like our family's likely going to. I just want to share this. You know, you probably have questions about participation rates. You got questions about what is a bonus look like? You've got questions about financial solvency rates. You've got a lot of questions out there. The best way to get your questions Answered is just to call us and we're happy to help you and we'll Answer those questions for you in a one on one consultation. All you got to do is pick up the phone and give us a call at (770) 685-1777 again (770) 685-1777. We're happy to Answer any of your calls. You can also visit ActiveWealth.com and click that schedule a consultation button in the upper right corner and you'll get booked directly into my calendar. I'm happy to Answer any questions you have. Also, Josh is always available to Answer questions that my clients may have as well. And we do specific. A special request of nationwide the carrier when we were actually submitting illustrations.

Ford Stokes:
We've got some some illustrations where people are asking for more than $1 million annuity and they may have 5 or 10, $10 million in assets under management. And we have to get special consideration and review by nationwide to do that. And Josh helps me do that as well. So I just want to say, Josh, thank you so much for all the support you give that you and Austin both give to my practice. Also, Dawn Bayless is the best in the operations business, period. She does a great job taking care of our clients and all the applications and make sure that, you know, we get delivery receipts signed and make sure that the clients are getting their policies in a timely basis. And also we're doing a really good job at the annual or reviews every two years on these these protection periods so that people can reallocate if they want to, to different indices. But I just want to say thank you again for all the support you provide for my clients and my prospect. And also I know our listeners really appreciate you appearing on the Active Wealth Show today.

Josh L. :
Well, thank you for. Thanks for having me.

Ford Stokes:
You bet. All right. We come back from the break. We're going to talk more about how to build that smart retirement plan and why right now is a great time to consider fixed indexed annuities as a part of your overall portfolio. You're listening to Active Wealth Show Radar AM 920 The Answer?

Producer:
It could cutting back on cable television lower your monthly expenses. I'm Jim Tarabukin with the Retirement.Radio Network Powered by AmeriLife, an April 2023 survey done by CNBC shows 70% of Americans are feeling financially anxious. Cnbc's senior personal finance correspondent Sharon Epperson explains.

Sharon Epperson:
A vast majority of respondents, 70%, say they are stressed about their personal finances, and that includes 57% of people earning $100,000 or more. 58% say they're living paycheck to paycheck.

Producer:
And while a large majority of Americans are looking for ways to cut back on their expenses, doing away with high cable bills could provide some additional relief. Generation Z and millennials know all about that, having ushered in the streaming era. But with streaming services expanding their menu of options, thus pushing up their monthly prices, streaming may actually do more financial harm than good. In fact, in January of last year, streaming giant Netflix added a $1.50 to their monthly rate, while Hulu is now charging 14.99 a month for their ad free streaming platform up from the previous 12.99 price point. With streaming becoming inevitably more expensive, is it possible to keep traditional cable while lowering the monthly bill? Some cable companies now offer a channel a la carte option. Maybe try cutting back on premium channels, pare down cable boxes, or downsize your plan to eliminate channels you don't watch and save 15 to $25 a month. Cutting back on cable television, part of our 23 cost cutters for 2023 for the retirement Debt Radio Network Powered by AmeriLife. I'm Jim Terebovlia to get your free copy of 23 Retirement cost cutters for 2023, give Ford a call today at (770) 685-1777 or go online to ActiveWealth.com.

Producer:
Is the banking crisis over? I'm Matt McClure with the Retirement.Radio Network Powered by a life. Two of the largest bank failures in US history happened just this year when Silicon Valley and first Republic banks collapsed. It happened after the Federal Reserve raised interest rates several times in its effort to tamp down inflation. A secondary effect of those moves is it cuts the value of government bonds, which banks commonly hold. That means when those banks need to sell bonds to improve their financial picture, they do so at a loss. That's what happened with SVB, and it was not able to meet its obligations during a run on the bank. So what happens now? Glenn Hubbard is chair emeritus of the Columbia Business School and served as chair of the Council of Economic Advisors for President George W Bush.

Glen Hubbard:
You're seeing deposits move from smaller and regional banks into money center banks. You're seeing a lot of questioning of the financial health of many regional banks.

Producer:
Hubbard recently told Bloomberg News. One big question is what will happen to deposit insurance? Currently, the FDIC ensures deposits up to $250,000.

Glen Hubbard:
The current law wasn't right. The limit was too small to deal with the modern economy, and the Treasury or the Fed would try to move to increase it. Whenever we get into trouble. So that's not good.

Producer:
So he says changes are needed. But exactly what will happen remains to be seen. Whatever does come our way. Hubbard told Bloomberg. The regulators need to get back to the basics.

Glen Hubbard:
Banks are very important in lending in some activities, so I think we need a more fundamental conversation about what do we want banks to do and how are small and mid sized businesses and real estate going to get credit?

Producer:
New research shows several other midsize or regional banks have hefty loads of uninsured deposits, so they are at risk of potential failure to. Jpmorgan Chase CEO Jamie Dimon recently said the banking crisis could push us closer to a recession. But the silver lining? He does not think it will be as bad as 2008. So how can you protect your hard earned money from a banking crisis? That's a key question to consider as uncertainty makes us all feel uneasy with the Retirement.Radio Network Powered by a mirror life. I'm Matt McClure.

Producer:
Hey, Ford. That was a fantastic interview with Josh Lumi, giving us some great insight, information on what's going on in the annuity business at large in the United States and why it should be a tool that you're at least considering for a portion of your portfolio and think now's a great time to play Chapter two from your book, Annuity 360. And listeners to this show can get a free copy of your book, Annuity 360 just by visiting Annuity 360.net. But enjoy this chapter and we'll be back to finish up the show in just a moment.

Ford Stokes:
Chapter two Why Annuity and Life Insurance Companies are Competing for Baby Boomer dollars. Big idea annuities counter one of a retiree's biggest fears outliving their wealth. Annuities create lifetime income streams. There are 73.4 million baby boomers in the United States that are close to or are already in their retirement years. Baby boomers put between 9 and 10% of their pay towards their retirement. Only 55% of boomers have any money saved for their retirement. More than 4 in 10 boomers inaccurately believe that Medicare will. However long term health care costs. Baby boomers hold $2.6 trillion in buying power. They've had more time to build their wealth in comparison to other generations because some might still be in the workforce and making more money. Baby boomers control 50% of the nation's wealth. Outspend younger generations and are more likely to spend their retirement savings on themselves rather than passing them down. Total US retirement assets are about $28 trillion. More than half of those assets were either defined contribution plans or individual retirement accounts. Some other facts about baby boomers and their spending habits. 69% of baby boomers either expect to or are already working past age 65 or don't plan to retire. Only 26% of baby boomers have a backup plan for retirement if they are forced into retirement sooner than expected. Baby boomers make up 46.8% of pet spending. Baby boomers are expected to spend 3.4% more on health related purchases than their parents did. Why are annuity companies targeting baby boomers? Boomers face many issues when planning for retirement.

Ford Stokes:
The three primary reasons are, number one, growing the money they have already saved. Number two, dealing with and preparing for unforeseen expenses, the largest of which are tied to health care and long term care. Number three, optimizing their financial plans when their exact lifespan is unknown. Annuities exist to help boomers with the last issue with an annuity, a retiree gives an insurance company a lump sum of money in exchange for an annual income that will last throughout their lifespan. Annuities have the potential to become useful tools in baby Boomers portfolios. When planning their retirement, they offer protection from market volatility while also eliminating the risk of outliving one's retirement savings, which are not guaranteed by portfolios that lean heavily on stocks and bonds. The demand for retirement income amongst baby boomers already exists, and annuities are the only products that can provide a hedge for a long life like longevity. Insurance reasons. Baby boomers should be interested in annuities. They are falling short of their retirement goals. Roughly 10,000 baby boomers retire every day, but a very small percentage of them believe they can retire and live comfortably throughout their golden years. Only 25% of baby boomers think they have enough money to retire comfortably. Many couples may be on the right track, but unforeseen circumstances such as health problems or staffing cuts, might force them into retirement earlier than planned, leaving a much larger income gap. Baby boomers are looking for a reliable source of retirement income and annuity companies are beginning to tap into this market because they recognize the need.

Ford Stokes:
Not all annuities are created equal. There are two main types of annuities immediate and deferred. The right kind of annuity depends on your financial goals, your situations and your needs. One thing that makes annuities so attractive is that there are so many options available. While it may seem overwhelming, a financial advisor can help you sort through all of your available options and make a smart choice for your money security for their income. Annuities can help build a secure retirement through different income strategies while also alleviating any stress or fear they may have left over from the financial crisis of 2008 and the bear market annuities can play an important role in a plan along with your Social Security, health care and other factors. Annuities can address issues such as maximizing your Social Security benefits, which help create an income that you can never outlive. How annuity and life insurance companies have responded to baby boomer needs. Interest in hybrid products. Baby boomers don't want to pay a fortune for something that offers them only a part of what they need with less income to be counted in their retirement years. Already paying for individual products to meet each of their needs can be too expensive. Life insurance companies heard these concerns and responded with new hybrid products. Many life insurance companies now offer some kind of long term care rider on their whole life or universal life products.

Ford Stokes:
Generally speaking, these riders provide coverage for long term care should you need it or you receive a death benefit if you don't. These combination products have grown from 6,000,000 in 2000 and 8 to 2.6 billion with a B in 2013 and they are still growing need for guaranteed income. Baby boomers are also concerned with outliving their money. They want to enjoy their retirement, but they also don't want to run out of funds. The industry responded to these fears by offering a variety of products with guaranteed lifetime income. These products include variable and indexed annuities with guaranteed living benefit riders and immediate or deferred annuities. The annuity industry has been transformed by these new products. According to PricewaterhouseCoopers Employee Financial Wellness Survey, since the economic downturn of 2008, 76% of retirees say that creating a guaranteed income is their top retirement planning priority. Annuity companies rose to the occasion to create products to meet the needs of baby boomers and provide them with a sense of security. The need for advisors Annuity companies have created many products to meet the needs of their consumers. This is a good thing, but it can make for a tough decision on the part of the investor with so many options to sort through. Some pre-retirees and retirees can't sort through all the information. Many are afraid to make the wrong decision, which leads them to make no decision at all. A large part of the planning process involves an advisor educating their clients on all of their options so they can make the right decision.

Ford Stokes:
I hope everybody enjoyed that chapter. Why Annuity companies are competing for baby boomer dollars and How it's Benefiting you. And also, listen, if you're in Gen X and you're considering an annuity, I would strongly urge you to do it. And also during that interview with Josh Lemon, he talked about, hey, it's probably a good idea for folks in their 40s and 50s to consider a fixed indexed annuity because you can get bonus on your money, you can get a higher participation rate and how the index performs over time. And you can also afford, if you're still working to let that money just grow and leave it alone and let that money defer inside of the annuity and grow with the market like gains as it's tied to a specific index. If you've got questions about how an annuity could really benefit your retirement and how you can get a really great income from the money you invest in a fixed indexed annuity, then I would encourage you to go ahead and reach out to us at ActiveWealth.com. So we're talking about why now may be a great time to invest in a fixed indexed annuity as well. Protection from longevity risk is another reason people are living longer. According to the CDC, the life expectancy in 1900 was under 50 years old. By 1950, it had risen to 68 years old.

Ford Stokes:
Today, life expectancy is 77 years old, but more than 6300 US citizens turn 90 years old every single day. And there are now more than 100,000 US citizens aged 100 or older, which is a shocking number to me. Another reason why you should consider a fixed indexed annuity and why now may be a great time to invest in one. A lot of retirees are fearful of outliving their money. They want their money to outlive them. According to a survey by AIG, Life and Retirement, when asked about planning for retirement, 59% of responders said they fear running out of money more than they fear death itself. So that's a majority of the respondents. Another really great reason why it could be a really good idea to invest in a fixed indexed annuity is lifetime income, no matter how long you live, while your assets in the stock market can lose value or be drawn down to zero as you age and as you withdraw money, an annuity provides you with an income you can never outlive. An annuity is life insurance against living too long. It's an insurance product, basically against living too long. And life insurance is insurance against living too shortly and dying too soon. Why would you try to systematically withdraw your assets when there is a safer option that will provide you with a personal pension for life? Did you know you could actually generate a personal pension? We can help you do that. It's the final.

Producer:
Countdown. So let's recap what you may have missed. It's the final countdown.

Ford Stokes:
So on today's show, we really talked about why now may be a great time to invest in a fixed indexed annuity. We gave you a lot of really great reasons for that. We went further into more reasons why you should consider that. We also played Chapter two for my book, Annuity 360, talking about how and why annuity companies are competing over baby boomer dollars and how that benefits you as an annuity purchaser. And I would encourage you to go ahead and pick up the phone and give us a call at (770) 685-1777 or go ahead and reach out to us at Active Wealth Show.com that's Active Wealth Show.com and we're happy to help you. All you have to do is reach out to us at (770) 685-1777. Listen, when you're thinking about retirement, you need to seek as much information as possible. If you're going to be a bear, be a grizzly about all the information you can seek about retirement planning so you can plan for that successful and fun retirement and spend more time with your family and friends and have a great time during retirement. Travel more. Enjoy that second home, have kids come to you. All those great things. Have your house paid off so you don't eat up one of your Social Security payments that's coming into the household. And again, I would encourage you to visit ActiveWealth.com if you have any questions. We look forward to helping you. Next week. We're going to talk more about how to build a smart financial plan and a smart retirement plan for your retirement future right here on the Active Wealth Show. Have a great week everybody, and go Braves.

Producer:
Thanks for listening to the Active Wealth Show. You deserve to work with a private wealth management firm that will strategically work to protect your hard earned assets. To schedule your free consultation, call your Chief Financial Advisor, Ford Stokes at (770) 685-1777 or visit ActiveWealth.com Investment Advisory services offered through Brookstone Capital Management, LLC BCM a registered investment Advisor. Bcm an active wealth management are independent of each other. Insurance products and services are not offered through BCM but are offered and sold through individually licensed and appointed agents. Investments involve risk and unless otherwise stated, are not guaranteed. Past performance cannot be used as an indicator to determine future results.

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