SPIA's

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snaggletooth's picture
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Joined: 2007-07-13

It's been a little while since I've looked at SPIA rates, but I need to run a few quotes.
What companies are you seeing with the best SPIA rates currently?

noggin's picture
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Joined: 2004-11-30

Can't you just run a search with all of them....?

nonews's picture
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Joined: 2009-12-09

Last couple SPIA's I wrote were with Nationwide. I ran quotes with several different companies simultaneously and Nationwide was always the highest.
 
But, SPIA's are such a ripoff for the consumer, IMHO. Basically the insurance co. issimply returning the client's premium with the most minimal interest. But, if the client insists.....

deekay's picture
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Joined: 2007-05-15

nonews wrote:Last couple SPIA's I wrote were with Nationwide. I ran quotes with several different companies simultaneously and Nationwide was always the highest.
 
But, SPIA's are such a ripoff for the consumer, IMHO. Basically the insurance co. issimply returning the client's premium with the most minimal interest. But, if the client insists.....
 
Based on your second sentence, you have no idea how SPIAs work.

WarRoom's picture
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Joined: 2009-10-25

deekay wrote:nonews wrote:Last couple SPIA's I wrote were with Nationwide. I ran quotes with several different companies simultaneously and Nationwide was always the highest.
 
But, SPIA's are such a ripoff for the consumer, IMHO. Basically the insurance co. issimply returning the client's premium with the most minimal interest. But, if the client insists.....
 
Based on your second sentence, you have no idea how SPIAs work.
 
No, that is just how the work.  The insurance company hopes they die early, the client hopes they live long.  If the die according the to tables its JUST how they work.  Disagree?

nonews's picture
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Joined: 2009-12-09

deekay wrote:nonews wrote:Last couple SPIA's I wrote were with Nationwide. I ran quotes with several different companies simultaneously and Nationwide was always the highest.
 
But, SPIA's are such a ripoff for the consumer, IMHO. Basically the insurance co. issimply returning the client's premium with the most minimal interest. But, if the client insists.....
 
Based on your second sentence, you have no idea how SPIAs work.
 
 
You make no sense. What are you talking about? Take a 10 yr period certain SPIA for say $100,000. How much is the insurance company going to pay back for the 10 yr period?? There's some homework, jackass. I bet the figure won't be much more than $100,000.
 
For example, I just dropped a $70,000 10 yr pd. certain SPIA, and the payout was $680/mo for 10 yrs. That totals $81,600 in return. I don't think that's a very good deal for the consumer. Remember, this is period certain. Not life only. There are differences in the payouts.
 

nonews's picture
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Joined: 2009-12-09

and actually, that 680 figure was the highest of all. The lowest was Lincoln Financial at 655/mo. That's a return of $78,600 for giving the ins. co. $70,000 over 10 yrs. that is a HORRIBLE deal!!! lol. How anybody would want one. But again, if the client insists........
They ARE simple and predictable. so for the super conservative Joe, I guess these sPIA's have their place.

anonymous's picture
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Joined: 2005-09-29

Nonews, what does your example have to do with anything?  SPIA's are typically purchased because they give someone the largest guaranteed income that they can't outlive.   A 10 year period certain annuity won't do this.

SBmss's picture
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Joined: 2006-11-17

They are not a panacea, but they are effective when used in conjunction with SS, other pensions or as an adjunct to their portfolio.I did a $250K SPIA earlier in the year with a 30 yr pd certain that is guaranteed to pay out $460K over the lifetime.  That, with her pension & SS takes care of her income for life and allows us to manage her other investments in a very conservative fashion.

nonews's picture
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Joined: 2009-12-09

anonymous wrote:Nonews, what does your example have to do with anything?  SPIA's are typically purchased because they give someone the largest guaranteed income that they can't outlive.   A 10 year period certain annuity won't do this.
 
 
It depends on what the person's objective is. If one wants lifetime income then certainly a 10 yr pd certain is not the payout option. I don't understand what you're getting at.

KensLoveChild's picture
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Joined: 2009-03-11

deekay wrote:nonews wrote:Last couple SPIA's I wrote were with Nationwide. I ran quotes with several different companies simultaneously and Nationwide was always the highest.
 
But, SPIA's are such a ripoff for the consumer, IMHO. Basically the insurance co. issimply returning the client's premium with the most minimal interest. But, if the client insists.....
 
Based on your second sentence, you have no idea how SPIAs work.And based on your first sentence, you're a crook.  I really don't understand you.  You say the "last couple SPIA's" assumes you have written multiple contracts, then you immediately state you think they are such a rip off...  THEN you go on to say you just dropped a $70k ticket, so you recognize a SPIA is a rip off yet you continue to sell.  Hmm.Finally, you contend(or "guess" in your words) that SPIA's do have a place, but it depends on the person's objective.You are confusing and confused. 

nonews's picture
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Joined: 2009-12-09

KensLoveChild wrote: deekay wrote:nonews wrote:Last couple SPIA's I wrote were with Nationwide. I ran quotes with several different companies simultaneously and Nationwide was always the highest.
 
But, SPIA's are such a ripoff for the consumer, IMHO. Basically the insurance co. issimply returning the client's premium with the most minimal interest. But, if the client insists.....
 
Based on your second sentence, you have no idea how SPIAs work.And based on your first sentence, you're a crook.  I really don't understand you.  You say the "last couple SPIA's" assumes you have written multiple contracts, then you immediately state you think they are such a rip off... 
 
 
LOL.  Why is it that most people are here to insult others instead of simply sharing ideas? Listen, I think there are better ways to make income than through SPIA's. However, if a client insists on a SPIA, am I supposed to turn their business away? that would be career suicide. SPIA's are indeed safe. That they are. If a client swears by a SPIA and wants a SPIA, then a SPIA they get. Period.THEN you go on to say you just dropped a $70k ticket, so you recognize a SPIA is a rip off yet you continue to sell.  Hmm.Finally, you contend(or "guess" in your words) that SPIA's do have a place, but it depends on the person's objective.You are confusing and confused. 
 
 

 
LOL.  Why is it that most people are here to insult others instead of simply sharing ideas? Listen jackass, I think there are better ways to make income than through SPIA's. However, if a client insists on a SPIA, am I supposed to turn their business away? that would be career suicide. SPIA's are indeed safe. That they are. If a client swears by a SPIA and wants a SPIA, then a SPIA they get. Period. I won't turn down 300 bps. in comp.
 

KensLoveChild's picture
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Joined: 2009-03-11

Career suicide is not putting your clients best interest first.  If someone wants to invest in a program that you believe is a "rip-off", don't you think it's your fiduciary responsibility to not let them?  "Mr. Jones, this hundred thousand you want me to put into this SPIA is a stupid idea, it's a total rip-off.  But I'm going to make $3000 off of your idiotic demand because you insist and after all, I am only an order-taker, not an adviser."  Enjoy your career.  You are a compliance nightmare.Signed,jackass

anonymous's picture
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Joined: 2005-09-29

nonews wrote:anonymous wrote:Nonews, what does your example have to do with anything?  SPIA's are typically purchased because they give someone the largest guaranteed income that they can't outlive.   A 10 year period certain annuity won't do this.
 
 
It depends on what the person's objective is. If one wants lifetime income then certainly a 10 yr pd certain is not the payout option. I don't understand what you're getting at.

 
You started by saying that they are a ripoff.  You then give an example of why they are a ripoff, but your example completely ignores the insurance aspect of an annuity.  People typically buy SPIAs to have an income that they can't outlive.  Even if a 10 year SPIA is a bad investment, that doesn't equate to SPIAs being ripoffs.
 
In 20 years, I've never sold a period certain SPIA.  I've never had anyone ask for a SPIA.  Seriously, what does the client say to you?  "I'd like a SPIA, please."  I've had clients tell me that they are conservative.  I've had clients want something that produces income. 
 It's tough not to call B.S. on you saying that you have people asking for SPIAs.
 
SPIAs don't look good right now simply because we are in a low interest rate environment.  Even so, if a SPIA is such a ripoff, please give me a better product for this person:
 
Jim is 80.  He has $100,000.  He wants as much income as possible.  He is very healthy and has a family history of long life.   He doesn't care about leaving money behind at death.  What product will give him more income than a SPIA?

ChrisVarick's picture
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Joined: 2008-09-04

I'm not the biggest fan of SPIAs either (for the average client), except in a few rare occasions. For the younger client, I see many bond funds getting the client more NET income versus locking a lump sum of cash into a SPIA. However, if the client is older, then the SPIA can provide more income at the risk of losing the client's principal.
If you analyze the product itself, a SPIA might not look as attractive as other alternatives. However, there are many situations where a SPIA can better optimize someone's overall investment portfolio. For example, a SPIA can guarantee that a household's minimum bills are paid allowing the advisor to more aggressively invest other assets generating a higher rate of return. What if the client is a single male/female and has no beneficiaries? What if the client wants to spend down his estate and use a SPIA to fund a life insurance policy?
 
While SPIAs are not a big part of my business, I always try to keep an open mind because you will always run into a situation where it does financially make sense for the client. I think that the public has swayed away from conservative insurance views and have forgotten that insurance products do not make families rich, they help manage risk.

Full Throttle's picture
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Joined: 2008-08-26

At another firm I'm no longer a part of, one guy made a lot of money showing his older clients how they could take $200,000 (or whatever amount, he would write tickets down to $100,000 and substantially larger ones as well depending on the situation), increase their income off the asset through a SPIA while using part of the SPIA payout to fund a life insurance policy to replace the asset at death.  Win for the client, less risk, higher payout, guaranteed for life.  Permanent life insurance bought at a younger age can help leverage this option in retirement without risking that your insurability will already be lost in the future.

nonews's picture
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Joined: 2009-12-09

Whatever.

chief123's picture
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KensLoveChild wrote:Career suicide is not putting your clients best interest first.  If someone wants to invest in a program that you believe is a "rip-off", don't you think it's your fiduciary responsibility to not let them?  "Mr. Jones, this hundred thousand you want me to put into this SPIA is a stupid idea, it's a total rip-off.  But I'm going to make $3000 off of your idiotic demand because you insist and after all, I am only an order-taker, not an adviser."  Enjoy your career.  You are a compliance nightmare.Signed,jackass
 

 
newbies are stupid

KensLoveChild's picture
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I think his feelings got hurt:Private Message

Subject: d***head

Sent: Today at 5:30pm

Sent by: nonews
Group: Newbie

d***head

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Go f*** yourself. Shut the f*** up. I simply stated an opinion and you
have chosen to run with it. Just shut the f*** up, you f***ing pussy.

anonymous's picture
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Joined: 2005-09-29

KensLoveChild, if it makes you feel any better, I got just about the same PM.

deekay's picture
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Joined: 2007-05-15

I feel left out.

nonews's picture
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Joined: 2009-12-09

My feelings were devastated Ken and anonymous. Thanks for the hug offer.

nonews's picture
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chief123 wrote:KensLoveChild wrote:Career suicide is not putting your clients best interest first.  If someone wants to invest in a program that you believe is a "rip-off", don't you think it's your fiduciary responsibility to not let them?  "Mr. Jones, this hundred thousand you want me to put into this SPIA is a stupid idea, it's a total rip-off.  But I'm going to make $3000 off of your idiotic demand because you insist and after all, I am only an order-taker, not an adviser."  Enjoy your career.  You are a compliance nightmare.Signed,jackass
 

 
newbies are stupidChief is such a failure that he must look for faults in others posts to
make himself feel better. I don't think I have ever seen Chief write
something constructive. Chief is pathetic as he scans the board for
errors in others to make himself big and bad. Chief is stupid. Chief must get a life. Chief recieved alot of growing up. I just know the type.

KensLoveChild's picture
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Joined: 2009-03-11

Please don't exclude Deekay this time around, okay?

30bonez's picture
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Joined: 2010-11-01

noggin wrote:Can't you just run a search with all of them....?I was thinking the exact same thing ... laziness will never get you very far, snaggletooth!

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