MetLife, Other Insurers Face Tough Annuity Calls

With the Department of Labor annuity ruling, the industry and retirees will have to wait and see what happens next. The 1,100 page ruling leaves insurance agencies like MetLife and others determining if they will fade away from annuity offerings or adapt to the new exemption-free offerings. If they opt to adapt, which most experts appear to believe will be their course of action, variable annuities could prove much harder if they switch to a fee-based system.

As ThinkAdvisor notes,

“As a result, many anticipate that, rather than attempting to comply with the strict standards imposed by the pending DOL rule, firms will switch from a widely applicable commission-based model to a fee-based model that charges an asset-based fee. While in some cases this could reduce the overall cost of the product, generally charging an annual fee rather than an upfront commission could still result in a product that costs the same amount over time.

However, it is also possible that many of the currently available riders to annuity products will be eliminated in order to produce a product that charges a lower overall fee, as advisors evaluate whether the lower cost, rider-free product can ultimately serve the same client needs over time.”

Many expect some form of the best interests contract exemption will be included in the final rule. So, the market is likely to adapt in the coming months. However, what sort of adaptation remains uncertain–a status that many expect to remain the same until at least the fall. Eric T. Steigerwalt, chairman, president and CEO of MetLife Insurance of Conn. said during a Q1 earnings call that, “Maybe four months or five months from now, we’ll have a better view of that, but right now given the fact that this (DOL rule) is almost 1,100 pages, we’re just going to have to wait and see what a number of distributors are going to do.”

So, the current situation appears to be a wait-and-see scenario. What happens this fall should dictate what level of adaptation the market makes. It would be unlikely to see annuities be phased out, but many options are still in play.

Have You Considered Income Maximization Through a SPIA?

Income Maximization

Sometimes a retiree’s nest egg turns out being less than what they planned on being.

Be it unexpected costs, projection errors or even a longer life expectancy, countless factors can upend your hard-earned retirement. Other factors out of your hands like declining CD and bond rates might derail your otherwise perfect retirement approach. And you can’t forget stock market volatility. With countless variables out there, it’s best to pad your income even if you have the slightest concerns about your future.

Are you dependent on earned interest income from fixed income investments? What about the stock market? If you do, you are at risk of losing your savings. Even if you’re eating through your retirement at the recommended 4% per year, outside elements have the potential to deplete your future faster than accounted for.

The bottom line is, don’t wait until the well is dry to search for more water. If you even think your financial levels are declining at a faster rate than expected, it may be time to revise your plan.

Now might be the time to consider maximizing with a single premium immediate annuity.

Income Maximization

Income maximization is just what it sounds like. It’s strategic planning to extend and optimize your earnings over your remaining years. In doing so, you reduce any potential impact that the aforementioned factors can have on your nest egg.

If you are over 60 years of age and are concerned about having enough income to sustain your retirement or plan on leaving an inheritance to your heirs, income maximization is an option worth considering.  

Thinking about retiring with the optimal funds is always a wise, proactive idea. Remember to always take a thoughtful approach to your retirement. With well-planned action steps in place and successful implementation, you should be positioned to enjoy your retirement in the way you envisioned.

The Advantages

Sure, maximized income sounds like a plan we all can get behind. More money? Sign me up! But there are more specific advantages to embarking on this endeavor. The first benefit is certainly a larger, more secure nest egg for you and your loved ones.

But additional benefits abounds when you factor in the additional level of security and comfort knowing that you’ve eliminated the risk from markets and other fluctuating investments. This new approach places you in a position to have a secured, guaranteed income from your annuity while maximizing net after-tax income.

In addition to reducing retirement risk, single premium immediate annuities usually provides you with more income. Other potential gains from your new strategy include increasing the rate of return on your investment and granting you tax advantages you previously didn’t qualify for. If you made this decision for your heirs, you have even more benefits potentially on the horizon. Your legacy is now secured and extended to heirs while maintaining the previous value of assets for their eventual inheritance.

As I mention whenever giving advice, do you own research as well. Consult with your tax and retirement professionals to ensure that this is the right course of action. Retirement is not a one-size-fits-all endeavor. Make the right, smart decisions for you and your loved ones.

To learn more about maximizing your income through single premium immediate annuities, and other ways to reach your pot of retirement gold, pick up a copy of my book Outlasting the Storm: A Survival Guide to Retirement Income Planning.

Rainbow Connection (Getting the Largest Pot of Gold)

Rainbow-Connection-compressor The rainbow crediting method launched towards the end of 2007. Unfortunately, the launch coincided with the tail of the previous bull market and annuity buyers selecting the rainbow method in 2007 and much of 2008 received the same zero returns as other indexed methods. However, as the stock market rebounded in 2009 the rainbow began to show its performance colors and this article looks at the relative performance of the different rainbow methods first reviewed two years ago.

The rainbow method is an option basket whose best-performing indices are weighted more heavily than those that perform less well. It is always a “look- back” because the money is allocated based on the ranking of the performance after the period is over. Rainbows are always index blends, but not all index blends are rainbows. The difference is blended methods state at the beginning what the percentage make-up is of the indices in the blend, but the rainbow method combination is based on the returns calculated with the largest portion going to the best performers. The Rainbow marketing appeal has been expressed by saying that the annuity buyer gets to bet on the race after it has been run and that most of the bet will be put down on the horses that “win or place.”

Learn about the rainbow strategy and how you can get your own pot of gold in my book, Outlasting the Storm: A Survival Guide to Retirement Income Planning


Additional credit to Jack Marion “Rainbow Connection (Getting the largest pot of gold).” May 2010.

The Rainbow Strategy (Global Lookback)

The Rainbow Strategy

In these times of high volatility, people are looking for ways to diversify their portfolio in order to protect their nest egg and try to capture as much of the upside as possible.

But what exactly is diversification? Is it choice? A Jelly Bean Store can have thousands of different choices of colors and flavors but everything you buy is still a jelly bean.

True diversification is a mixture of uncorrelated, or lesser correlated, items. When looking for diversification for where you put your nest egg, you want to be spread out across the different economies around the globe.

Where do you think we are going to see the economy improving in the next ten years? China? Europe? Japan? America? How would you like to be in a position where you would not have to guess which economy will grow the fastest to be able to take advantage of that growth? That is what the new “rainbow crediting method” does.

Many of the experts familiar with this strategy say it is like being able to bet on the race after the horses have run. Here is how it works. The strategy uses four indices from around the world: the Hang Seng in China, the Dow Jones Eurostoxx 50 in Europe, the Nikkei 225 Index in Japan, and the S & P 500 in America. This strategy is not only diversified using economies from around the world, but it is also weighted so that most of the money is going to the indices that are producing the best results.

Learn about the rainbow strategy in my book, Outlasting the Storm: A Survival Guide to Retirement Income Planning

Is this the Real Super Annuity?

Phillip Wasserman - savings

This past Sunday afternoon I received a call from a very good friend of mine who runs one of the most successful annuity shops in the country. He starts explaining to me about a new product that will be available this week. Hesitantly, I tell him I don’t believe a word he says, and he comments back, “ Phil, I thought it was too good to be true too.” Then he sends me an email proving everything he said was spot on as usual.

I’ve been very disappointed in annuity companies recently for a number of reasons. They have reduced the benefits of their products, cut agents’ commission significantly, and are blaming low interest-rates (that might be acceptable if they had not been booking record profits the whole time they are trying to help clients).

I’ve trained thousands of insurance representatives — most of them are very hard-working, good people dealing with an environment where they are at war every day with companies regulators and they have little control over the products. Annuity products are presented to the public so complexly that you would think it was done on purpose — but this one is different.

So, back to this new product. It has one of my favorite features — liquidity — you’re able to get your money back in a short time without surrender penalties, and that is magnificent. You also get uncapped growth, which means there’s no limit to how much money you can make and the income is the highest you’ve ever seen.

When you add in it’s a quality company, it’s a recipe for major success.

I have no doubt within a very short time it will be the number one annuity in the country and everyone else will be chasing it. Yes, the product is that good.

If you’ve ever thought of buying an annuity, now is your chance. Fortunately it’s available through a lot of very good representatives nationwide, although it is not available in every state just yet. If you’d like some information on this email or call me and I’ll be sure to steer you to great rep in your area.

Phillip Wasserman’s Take on the Department of Labor Ruling

Justice Scales

Once again the insurance industry stuck its head in the sand and waited for the government came by to kick it in the rear end with the Department of Labor’s recent fiduciary rule.

For those who don’t remember it was my legal brief that overruled 151A. Through my relationship with the Speaker of the House, myself and others successfully lobbied to have the government change the law on annuities. We made sure the law in Florida was not changed to a 5-5 annuity.

In my legal opinion, I agree with many other attorneys that, if handled properly, the rule will be overturned. If not, most of us can kiss our annuity business goodbye. While I am almost 100% convinced that the rule will eventually be overturned, I am certain that it will costs hundreds of thousands of dollars in the process. On a personal level, I am not too concerned. Most of my work is in the life insurance sector these days. But what concerns me is that the companies don’t appear to prepare for moments like this. You’d think they would know how to handle this. Instead, it seems as if they don’t have a care for people like you and the ones they assist.

My thought is just another in the mix. With it and five dollars, you can buy a coffee at Starbucks. Take with it what you will, but I am not a fan. In time, along with a hefty bill, the rule will likely have a short shelf life.

Are Annuities Right for Your Plan?

Source: GotCredit

Source: GotCredit

When it comes to personal finance and retirement planning, there is no one size fits all method to follow. Every circumstance and situation creates a need for a different approach. What might be right for you could be the worst option for another retiree.

Usually, an annuity becomes an option for a retiree when they have maxed on more traditional tax-advantageous investment options, like 401(k) and IRAs. As CNN Money noted, “If you have additional money to set aside for retirement, an annuity’s tax-free growth may make sense – especially if you are in a high-income tax bracket today.”

Annuities certainly can be a buyer beware-type atmosphere. Without the proper analysis of your potential investment, you could be investing in a lemon when you wanted stability. It’s why I always stress the mandatory need for thorough research conducted before taking the plunge. Not only should you ask every question you have to your finance professional, but you should research these answers yourself as well. At worst, you’ll find the same information your professional presented you, and now you’ll have more material to make the best decisions for your retirement.

If you’re uncertain if an annuity is right for your investment plan, see if you fall into these situations:

Outliving Your Money? Guarantee Your Income

For those worried that they might outlive their money, an annuity could be the option to ease their fears. With life spans extending and markets always susceptible to volatility, many annuities ensure that you are taken care of regardless the scenario. Immediate annuities could be right for you. Another option to consider is investing in multiple annuities to protect yourself from an insurer potentially going under.

Depending on your advisor, you may hear that an immediate annuity is best. Others might suggest an inflation-adjusted investment to protect you and your heirs. Again, it’s all about what fits you best. Consider all the elements that go into your planning. You have to factor in the annuitant’s age, investment amount and other key factors before determining the proper course of action. If you choose correctly, you can breathe easy knowing your income is ensured while protecting your principle.

Conservative Seniors

The investment landscape shifts as interest rates go lower. As they do, traditional conservative options, like CDs and money market accounts, prove less like the tried and true method they once were.

With annuities, you have various options to match your investment as well as your risk tolerance. While I highlight seniors in this category, any conservative investor could be a fit for an annuity–especially a fixed option. Not only will this conservative approach ensure you have a lifetime income, you now have the opportunity to earn more than other options. The aforementioned CDs and money market accounts definitely have earning potential, but an annuity may be the right fit for you if you’re the kind of conservative looking to generate the most return on your investment.

When comparing money market and bank CDs to a fixed annuity, you begin to see that the annuity investment is the only option that guarantees you income for life. Additionally, it’s tax-deferred accumulation benefits are often alluring to those otherwise considering a non-qualified investment.

Certainly, other individuals fit the bill for an annuity investment–and some in the above instances might be better on another route. However, these are some options worth considering as you move forward in your planning.

The Fallacy of the Financial Advisor

I can’t help but wonder when I meet retirees, with a total net worth between $200,000 to $400,000, who have a financial advisor that is either an annuity sales person or a lower echelon stockbroker.

Instead of using these asset gathers, these retirees could benefit more from simple income and income planning advice about income and income planning.

Most super affluent retirees have CPAs, attorneys and multiple financial advisors, while affluent retirees either have a quality financial advisor or handle it themselves.

An Emphasis on Education

One of the great things about the MoneyShow is the emphasis on education. The people I’ve met through the MoneyShow are more advanced and knowledgeable than the people I meet at retirement seminars.

This is a true testimonial to the service the MoneyShow provides to hundreds of thousands of people.

Everybody today needs to be a specialist. There is simply too much going on and too much regulation.

My specialty is annuities and tax-free wealth transfer which is known as the anti-annuity. I also do a tremendous amount of long-term care and home health care planning even though I do not sell those products.

Keep it Simple

There are experts who write covered calls for income, there are bond experts, and there are dividend paying stocks experts.

It’s a complex world and nobody can be all things to all people. Most of the time I find that a little common sense goes a long way.

People who are retired should have simple goals. Don’t run out of money; prepare for health costs, provide what legacy benefit you want and most of all have a great time!

If I can help you with any of that feel free to email or call me!

For more info, contact Phillip Wasserman: or 800-254-9567.

Protect Yourself from These Retirement Threats

Source: American Advisors Group

Source: American Advisors Group

“Aging is humanity’s greatest, most important, and most enduring discovery. The discovery and exploitation of human longevity is what has led to the globe-dominating species we have become.” — Dr. William Thomas, M.D.

For most Americans today, retirement begins at around 63 years old and lasts roughly 18 years. After years of hard work, retirees deserve to enjoy their remaining years in a financially stress-free environment. Retirees must have a safe, sustainable retirement income. Several different paths and products that, in addition to your income, should assist your revenue as you near retirement, if needed. No one option is the perfect fit, but with proper guidance and research, you can carve the ideal path for you and your loved ones.

Sometimes, however, threats to your nest egg can arise. It’s crucial that you properly maneuver these potential pitfalls, or your hard-earned retirement could be threatened.


Inflation can take down even the strongest retirement plans. Always keep an eye out for the interest rate in your savings account is paying. With inflation likely outpacing your interest rate, prices on needed goods and services can sneak up on you. This also goes for travel and medical needs.

If you feel like inflation could dismantle your agenda, consider an additional revenue stream like a hybrid annuity.


Going beyond medical costs, seniors require more medical attention regarding daily and long-term care. Over time, they can add up and impact your savings more than expected. Remember to keep prescriptions, doctor bills and hospitalization fees all in the forefront of your mind. If these medical issues arise before you hit retirement, consider that you may have to take time off work. This can impact your earnings and throw off your original plans. If a health issue looks like it could hinder you pre-retirement or during, be sure to adjust your plan accordingly.


When did you start to plan for your retirement? If you answered with a relatively young age, congratulations. You’re putting yourself in a great position. Beginning a 401(k) in your 20s will provide you with a larger and longer return on investment over time. The longer you wait, the less you will have saved. It’s as simple as that.

If your company offers a 401(k) plan, take it. If not, start a retirement option on your own. With life expectancies lasting longer, you’ll want to have stored away as much as possible.


Let’s be real, fees can be confusing, even for the experts. And even when you do understand them, you might find that they are incredibly high! Unfortunately, fees are sometimes an unavoidable aspect of retirement. That’s why you need to make sure that your retirement expert is just that. With a proper advisor in place, you will know exactly what you are paying and when.

None of us like fees, but at least you’ll know what to expect when a payment is expected.


Like fees, taxes can be a costly oversight if you make a mistake.

If your plan includes 403(b)s, SEP IRAs, 457(b) plans and/or Traditional IRAs. you’ll have to factor in minimum distributions once you reach your 70s. Depending on the sum, you could wind up paying a large portion to the IRS each year. To minimize this risk, consider coversion options that may align with your goals. Other options are out there to consider. As always, consult your retirement professional before making any decisions.


The fall of the stock market is a common concern for retirees. Many think that if it crashes as they edge closer to retirement, all their effort goes down the drain. However, your retirement should live out a crash many times over, if planned correctly.

If you find yourself concerned, don’t worry, you have options. Bond funds, mutual funds, ETFs and other investment options can lessen your worries. Choosing the right options and investments should make this a minor issue as you approach your later years.

The Best Retirement Planning Advice Ever

Phillip Wasserman retirement planning

My hobby is playing tournament poker. I’m lucky enough to get to play once in a while with a lot of the people you see on television. The nice thing about tournaments is that you can only lose what you paid to enter.

A few months ago, I went very deep in a large tournament. I called a close friend of mine who finished second in the World Series of poker a few years ago. My friend was lucky enough and skilled enough to win almost $6 million at the age of 25. The purpose of my call was to ask him advice for the next day and he had one sentence for me…don’t do anything stupid.

The more I think about this the more I realize this applies to retirement planning. Most people have won the game and they just need to enjoy retirement and not do anything stupid.

What they should really do is guarantee their income and make sure they have extra income if a spouse dies or a pension is lost. They should also make provisions for long-term care expense and home health care. After that they should enjoy their retirement.

They should certainly avoid ridiculous products with very high fees like variable annuities and should always ask whoever they’re dealing with what their fees are.

If retirees want to leave money to their children, they should do it through legacy planning because people are living longer than ever before and retirees might need their money for income while they are in their 80s and 90s.

I do income planning, legacy planning, long-term care, and home health care planning through the use of hybrid insurance products. I don’t sell long-term care coverage but I can show you how to get it through a hybrid insurance product with no medical questions and no extra expense.

Around a year ago, Barron’s published a great article about this and I’m happy to send you the link. Email me or call me and just remember don’t do anything stupid and have a good time!

For more info: or 800-254-9567.