Flexible Gold

Flexible Gold - www.earlebird.com

With all the Olympics hoopla and watching our young men and women on the medal podium, I started to think about the Olympics in terms of my personal life. You know, like which grocery store in my world would win the gold medal, or which restaurant would win the silver medal, or which coffee shop would bring home the bronze.

If you want the results of my personal Olympics, I’d be happy to share them with you. Since this blog relates to annuities, right now I’ll focus only on the annuity product feature that would stand tallest on the podium. And, it’s a no-brainer, folks, although it never was considered a “feature.” This feature certainly didn’t help close any sales at the time of purchase. In fact, most people don’t realize they even have it. And just about every annuity agent didn’t know they sold it. Ready? It’s called having a flexible contract option, or, in real terms, it means you can add future deposits to your existing annuity contract. In other words, if you own a deferred annuity, the contract either accepts future deposits (flexible) or it doesn’t (single premium).

Why do I think owning a flexible annuity contract is so valuable? Because, let’s face it, interest yields have absolutely tanked since you plunked your nest egg down as an initial deposit. Rates were higher then; in fact, they were probably much higher, right? Do you know what else was probably higher? The minimum guarantee rate for your contract. The minimum guarantee rate is the lowest rate your contract can ever earn for the life of the contract. And this minimum guarantee rate applies to all deposits made into the contract. So, many Americans are making deposits today and earning 3% on their money. We even have clients earning as high as 5.5% due to a 5.5% guaranteed minimum. Unbelievable!

It’s funny that agents never saw the importance of selling flexible annuity contracts. I was one of those agents. We thought interest rates would only increase. It worked that way for 20 years. But with rates at 1.5%, we now know otherwise. We, as agents, should have instructed clients to open a flexible annuity, just in case. Open up an annuity with a minimum deposit, and be prepared if rates plummet. But, who knew back then?

Pay-it Forward:

My daughter Willa loves Bill Murray’s movie What About Bob? In the movie, Murray’s neurotic character Bob Wiley lives by a book titled Baby Steps. He does everything in baby steps: baby steps to the store, baby steps on the elevator, baby steps down the subway stairs. Everything must start with baby steps. There’s a lesson to be learned here. Make sure your post-grad is taking baby steps into new ventures. Progress is key to life, especially after the college years are over. Check in with your post-grads monthly to make sure they are moving forward, even if they are using baby steps.

Earl E Bird

I'm Earl E. Bird and I am very concerned about saving for my senior years. I am amazed at the stumbling blocks that exist when saving for retirement. That's why I take my time when making decisions on building my nest egg.

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About the author

I'm Earl E. Bird and I am very concerned about saving for my senior years. I am amazed at the stumbling blocks that exist when saving for retirement. That's why I take my time when making decisions on building my nest egg.

More posts by | Visit the site of Earl E Bird

 
 
 
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