Valuable Players(NOT)
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[quote=dude]
Let's put this into perspective:
If you bought the Vanguard 500 (S&P index fund) at the peak in March of 2000 and were dumb enough to not diversify into other asset classes (mid cap, sm cap at least) then you are about even as of today (O.K. your down by -1.3%, I'm not splitting hairs here ) including reinvested dividends. Yeah who's to say it will be permanent, but we still have 4 years to go before you've held it ten years and you have broken even at year 5 being really stupid (not diversifying) during the 2nd worst bear market in history!!! Look at your Ibbotson chart and tell me how many BIG drops you see and how far apart are they (3 big drops about 30 to 40 years apart). Now if you had been smart and diversified among capitalizations, bonds and reits, you most likely broke even with a little extra by the end of 2003. Who needs a guarantee. This makes $ for the insurance companies (and us) for a reason.
I'm getting tired and going home (It's 9:11pm Pac Time) have a good night.
[/quote]
You're right, of course. The only people who can't admit it are those addicted to 6% commission products or have nothing lese to sell.
“You really don’t need this, but if you can’t sleep at night without it”
That's funny I tell people this all the time, disclose the costs vs. a mutual fund show them illustrations of both and people still choose the VA.
Instead of arguing this point let's change the disccussion to investing in CD's for growth.
OMG,
That is like saying a person who has a small child SHOULD NOT buy an SUV for protection in a crash because it is more expensive, costs more in gas, and well frankly, you might not even have a crash anyway.
So if you were a car salesman you would sell everyone a Ford Focus?
That isn't the world we live in. Some people want protection whether they will use it or not, and WILL pay more to get it.
What is the percentage yield cost of peace of mind? I'd say it is about total VA costs M&E costs with GMIB riders (which by the way, is only 1.7% in the JH Venture, where is everyone coming up with 3% plus??).
I don't know about YOU...but I am UNWILLING to look at my 65 year old client, who just lost 30% of her money in another market downturn, and tell her she is going to have to "adjust" her lifestyle...not so long as their are tools to avoid it and still grow her money.
To many advisors take the emotions OUT of it...that's the problem.
Of course nobody comes in ASKING for an annuity...nobody comes in asking for MFS Total Return or American Funds Europacific fund either...so that means you don't sell it to them???
Terrible argument point...unworthy of further thought.
[quote=bankrep1]
“You really don’t need this, but if you can’t sleep at night without it”
That's funny I tell people this all the time, disclose the costs vs. a mutual fund show them illustrations of both and people still choose the VA.
[/quote]
If tell them they don't need it, fine, I believe you. You and I both know that's rare AND that annuity sales pieces paly up the bogus "need" for the guarantee.
I think the point is that clients do come in and ask about mutual funds in general terms way more than they do about VA's.
Just my .02
scrim
[quote=BankFC]
Of course nobody comes in ASKING for an annuity....
[/quote]
The point is several annuity defenders have said it's a good product for people who "need" a guarantee. The fact is there isn't a single person HERE who thinks they need that guarantee. They should have it explained to them that their fears are unfounded. Instead, what happens is those unfounded fears are used as a hook to sell them an annuity.
LOL...they come in and ask about "investing"...and since the only thing you think about it mutual funds, to you, that's what they are asking about.
BY the way...I don't care what a client comes in asking about anyway...we are professionals, remember? We have a fiduciary responsibility to match investments with goals, time frame, and risk tolerance.
If all your doing is having them point to one of five or six allocation models and shoving them in it, you aren't much more than a glorified order taker.
[quote=BankFC]
OMG,
That is like saying a person who has a small child SHOULD NOT buy an SUV for protection in a crash because it is more expensive, costs more in gas, and well frankly, you might not even have a crash anyway.
[/quote]
Not even close. If you need a car example it's more like the salesman who knows the cars he sells will never rust and have lifetime rust warantees, yet he tries to sell rust proofing to everyone who walks into the showroom OR he doesn't bother to explain to people afraid of rust that there's nothing to worry about.
[quote=BankFC]I don't know about YOU...but I am UNWILLING to look at my 65 year old client, who just lost 30% of her money in another market downturn, ...'
[/quote]
Please be serious. You're not talking to yokels who are prospective annuity buyers here. We know better. Just when as ANY 65 year old client looking for income like your example EVER seen a 30% loss in a properly diversivified account? Moreover, just what is your 6% commission going to do for her aside from lock her into something?
[quote=mikebutler222][quote=BankFC]
Of course nobody comes in ASKING for an annuity....
[/quote]
The point is several annuity defenders have said it's a good product for people who "need" a guarantee. The fact is there isn't a single person HERE who thinks they need that guarantee. They should have it explained to them that their fears are unfounded. Instead, what happens is those unfounded fears are used as a hook to sell them an annuity.
[/quote]
Did you not see my other post?? A LOT of people could care less about their ACTUARIAL risk of losing their money...it's peace of mind and a safety net they want...like it or not.
here you go...
[quote=BankFC]
OMG,
That is like saying a person who has a small child SHOULD NOT buy an SUV for protection in a crash because it is more expensive, costs more in gas, and well frankly, you might not even have a crash anyway.
So if you were a car salesman you would sell everyone a Ford Focus?
That isn't the world we live in. Some people want protection whether they will use it or not, and WILL pay more to get it.
What is the percentage yield cost of peace of mind? I'd say it is about total VA costs M&E costs with GMIB riders (which by the way, is only 1.7% in the JH Venture, where is everyone coming up with 3% plus??).
I don't know about YOU...but I am UNWILLING to look at my 65 year old client, who just lost 30% of her money in another market downturn, and tell her she is going to have to "adjust" her lifestyle...not so long as their are tools to avoid it and still grow her money.
To many advisors take the emotions OUT of it...that's the problem.
[/quote][quote=BankFC]
LOL...they come in and ask about "investing"...and since the only thing you think about it mutual funds, to you, that's what they are asking about.
BY the way...I don't care what a client comes in asking about anyway...we are professionals, remember? We have a fiduciary responsibility to match investments with goals, time frame, and risk tolerance.
If all your doing is having them point to one of five or six allocation models and shoving them in it, you aren't much more than a glorified order taker.
[/quote]
I'm not sure who this is directed to, based on the mutual fund comment. I will say this however, if we really did take our profession seriously and DID match INFORMED (education is part of our job too) clients to proper investment vehicles there'd be a massive drop-off in the number of annuities sold.
[quote=BankFC][quote=mikebutler222][quote=BankFC]
Of course nobody comes in ASKING for an annuity....
[/quote]
The point is several annuity defenders have said it's a good product for people who "need" a guarantee. The fact is there isn't a single person HERE who thinks they need that guarantee. They should have it explained to them that their fears are unfounded. Instead, what happens is those unfounded fears are used as a hook to sell them an annuity.
[/quote]
Did you not see my other post?? A LOT of people could care less about their ACTUARIAL risk of losing their money...it's peace of mind and a safety net they want...like it or not.
[/quote]
You seem to continue to mss the point. Their "peace of mind" is only at risk because they haven't met a professional who explained their fears are unfounded. More likely what they've met is someone who played on their unfounded fears and used annuity propaganda built on the bogus "need" for a "guarantee".
[quote=BankFC]
here you go...
[quote=BankFC]
OMG,
That is like saying a person who has a small child SHOULD NOT buy an SUV for protection in a crash because it is more expensive, costs more in gas, and well frankly, you might not even have a crash anyway.
So if you were a car salesman you would sell everyone a Ford Focus?
That isn't the world we live in. Some people want protection whether they will use it or not, and WILL pay more to get it.
What is the percentage yield cost of peace of mind? I'd say it is about total VA costs M&E costs with GMIB riders (which by the way, is only 1.7% in the JH Venture, where is everyone coming up with 3% plus??).
I don't know about YOU...but I am UNWILLING to look at my 65 year old client, who just lost 30% of her money in another market downturn, and tell her she is going to have to "adjust" her lifestyle...not so long as their are tools to avoid it and still grow her money.
To many advisors take the emotions OUT of it...that's the problem.
[/quote] [/quote]
Scroll back, I've already answered this.
[quote=mikebutler222][quote=BankFC]
OMG,
That is like saying a person who has a small child SHOULD NOT buy an SUV for protection in a crash because it is more expensive, costs more in gas, and well frankly, you might not even have a crash anyway.
[/quote]
Not even close. If you need a car example it's more like the salesman who knows the cars he sells will never rust and have lifetime rust warantees, yet he tries to sell rust proofing to everyone who walks into the showroom OR he doesn't bother to explain to people afraid of rust that there's nothing to worry about.
WOW...according to your example, you are telling your clients their accounts will NEVER go down, and they have NO MARKET RISK. NO??? Let's use your example:
"It's like the salesman who knows the car he sells (the investments he sells) will never rust (lose principle) and has guaranteed warranties (mutual funds have guarantees? wait, no, thats a VA )...blah blah blah.
Your piss poor example and faulty logic lead me to question your reasoning and analytical skills. But I definitely welcome a rebuttal.
[quote=BankFC][quote=mikebutler222][quote=BankFC]
OMG,
That is like saying a person who has a small child SHOULD NOT buy an SUV for protection in a crash because it is more expensive, costs more in gas, and well frankly, you might not even have a crash anyway.
[/quote]
Not even close. If you need a car example it's more like the salesman who knows the cars he sells will never rust and have lifetime rust warantees, yet he tries to sell rust proofing to everyone who walks into the showroom OR he doesn't bother to explain to people afraid of rust that there's nothing to worry about.
[/quote]
WOW...according to your example, you are telling your clients their accounts will NEVER go down, and they have NO MARKET RISK. NO??? Let's use your example:
"It's like the salesman who knows the car he sells (the investments he sells) will never rust (lose principle) and has guaranteed warranties (mutual funds have guarantees? wait, no, thats a VA )...blah blah blah.
[/quote]
It's obvious you're deeply confused (although my guess isn't you're as confused as you pretend, you're just as confused as you need to be to sell a massive commission product). Perhaps we should start fresh with something more to the point. We've hear over and over again that some people “need” that guarantee. <?:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" />
1) Tell me, does a diversified, balanced long term investor “need” a guarantee? Or do they just think they need a guarantee?
2) You mentioned the mythical 65 year old client who just lost 30% of their portfolio in a downturn and may need to change their life style due to it. Just when has ANY 65 year with a balanced income portfolio lost 30% of their portfolio value in a downturn?
Either you’re as clueless as the guy who thinks he needs a “guarantee” or you know you’re using bogus examples.
[quote=BankFC]
Honestly, Mike, at least you could be a man and own up to your faulty logic...
[/quote]
Gee, I had no idea you'd have a fit if I stepped away for an entire 10 minutes. Get a grip pal, and try decaf
Hey what about the people that invested their life savings in the stock market in Japan? Oh wait thats different....