In Part I of this feature earlier this week, my discussion with two of the best retirement planning producers in the business, Gregory B. Gagne, ChFC, and Wayne D. Minich, CLU, ChFC centered on how they came to specialize in retirement planning, advice for those who want to enter this space, and how they educate their clients and prospects about how much they need for a secure retirement and motivate them to plan appropriately.
In Part 2, Gagne, who is managing member of Affinity Investment Group, LLC, in Exeter, N.H., and Minich, CLU, ChFC, president of Applied Financial Concepts, Inc., and Wayne D. Minich & Co., Inc., in Richfield, Ohio, will cover how they combat media annuity criticism, integrating the issue of Social Security benefits in retirement planning discussions, and primary concerns and reasons for optimism in the retirement planning market.
‘Guaranteed income needs to be a portion of the overall plan’
If you sell annuities, no doubt you’re aware that consumers continue to hear and read strong criticism of annuities, often criticism centered on their complexity. I asked Mr. Gagne and Mr. Minich how they combat that criticism in their own retirement planning discussions.
Mr. Gagne said, “I start by talking with them about all the ‘drawbacks,’ and then, after we have got all the problems related to annuities on the table, I change gears and refocus. You can run out of assets, but you can never run out of income when you do an annuity. Guaranteed income needs to be a portion of the overall plan. For some this is via defined benefit and Social Security, and for others it may include the need for an income floor created by an annuity income stream. This then enables the advisor to optimize a portfolio and takes much of the risk of sequence of returns issues right off the table.”
Mr. Minich focuses on the annuity’s utility. “We explain that, like anything else, an annuity is a tool. By properly educating how, if appropriate, an annuity fits with the client’s plan, including the extra costs, the client typically understands why the annuity is a piece of their planning puzzle. We also want to address what negative information they may have read or heard about annuities in order to offer a counterpoint to that opinion.”
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