| Seniors Retirement Savings placed into an | | | | returns. Until recently, some insurance companies |
| equity-indexed annuity was burned. Do financial | | | | proclaimed it almost sold itself. |
| representatives have enough steak and credibility left | | | | The financial representative could earn up to 10% in |
| to alter an equity-indexed annuity into safer senior | | | | commissions for finding someone to invest. Selling |
| retirement savings? With stability absent, should a | | | | one of these annuities with a face amount of just |
| senior's shaky annuity foundation still be indexed on | | | | $50,000 could result in $5,000 commissions. Before |
| an equity basis or changed? | | | | the economic downturn, over 120 billion dollars were |
| Equity-indexed annuity sales seemed like the perfect | | | | invested in indexed annuities, many sold to seniors |
| solution to insurance companies trying to gain ground | | | | who are usually not the most suitable purchasers if |
| on total assets maintained in relation to their | | | | they are seeking retirement savings stability. |
| competitors. Financial representatives are be paid | | | | Combining the tremendous stock market plunge, with |
| highly rewarding commissions, while the insurers | | | | initial fees, and high surrender charges EIA, |
| maintain a good profitability margin. Consumers, | | | | equity-indexed annuity products have badly burned |
| especially the wealthy and elderly were easy to | | | | the wealth and the seniors. |
| convince hold fast their retirement savings could | | | | WHAT SHOULD THE FINANCIAL REPRESENTATIVE |
| increase. Past performance history showed saving | | | | DO? If you talk to a senior that current has an EIA, |
| stability and better returns than other investment | | | | ask them personally about their feelings. Would |
| opportunities. Seniors took the bait, financial reps | | | | getting out of the EIA, despite the surrender charges |
| reeled in the cash, and insurance companies profited | | | | imposed be a true solution? The potential client has |
| from the catch. However seniors were never | | | | true feelings about stability, and being asked again to |
| explained the crushing economic effects of | | | | take risks is not right. If the equity-indexed annuity |
| surrendering all or part of their EIA policy. | | | | was sold to them by an inexperienced insurance |
| An EIA, equity-indexed annuity, is similar to a hybrid | | | | financial representative, that person is probably |
| mixture of mixing together features from fixed | | | | already out of the business. A lifetime income annuity |
| annuities and variable annuities. A guaranteed interest | | | | also recognized as an immediate annuity could be |
| rate is paid out by fixed annuities. This is a similar | | | | solution. A guaranteed income sure beats one based |
| concept to bank certificates of deposits, which many | | | | on an EIA chance. This chance taken, is sending too |
| seniors had their retirement savings stability banked | | | | many semi-wealthy individuals struggling to now |
| on. However, fixed annuities could provide higher | | | | adjust to a middle-income lifestyle. |
| rates and add on attractive riders than plain CD's | | | | For the future of annuity salespeople who have |
| could not. Variable annuities use sub-accounts; similar | | | | experience, honesty, and trust building qualities this |
| to choosing mutual fund portfolios to invest in, where | | | | economic disaster should be viewed as a great |
| you invest in the stocks of many companies. | | | | opportunity for gaining clients and a strong reputation. |
| The advantage of the equity-indexed annuities is | | | | For agent trainees of improperly titled financial |
| taking the best features of fixed and variable, and | | | | pretenders both are losing clients they never should |
| allowing you to accumulate retirement savings or | | | | have pursued. These imposters are getting a |
| receive a monthly income from the accumulated | | | | permanent kick out the door. This is just treatment |
| values. So not only is the participant receiving a | | | | for them and the insurance company that hired them |
| minimum interest rate, but share in the stock market, | | | | for taking advantage of so many seniors and |
| which tends to gain in value. Now it became possible | | | | transferring the wealth of many people's assets and |
| to without the associated risks, earn stock market | | | | retirement savings into a devastating nightmare. |