[quote=scrim67]

two questions:

1.  If annuity products and mutual funds paid exactly the same to the broker how do we feel sales of these products would change?

Easy...VA.

2.  What would you put a family member or close friend into:   VA's or Mutual Funds?

Done it with about 15 friends/family.

scrim

knucklehead…okay I used the wrong term ACAT instead of liquidate the annuuity and transfer it and go direct to mutual funds for 1/3 the cost. If I sold nothing but annuities and other insurance products I would be producing 125-150k too. I choose to take a different road with my clients…what is in their best interest not mine. I, most likely, do all the same types of insurance and insurance products as you. LTC, Term and Permanent Life, Disability, and Annuities. I also sell taxable and nontaxable bonds, mutual funds, stocks and CDs. The latter group is the greatest portion of my business. If I did more WL and annuities instead of Term Insurance and mutual funds, I would more than double my production. The only difference between you and me is the investments that I sell my clients. Beware, there are honest guys out there that love to review clients of adivsors just like you. Within an hour most people realize that they are being swindled. There is one reason that you and your peers produce more than me and others like me. You sell higher commission investments and insurance products. Period.

Peanutbroker, if VAs are a “swindle”, why are they legal?

[quote=peanutbroker]knucklehead...okay I used the wrong term ACAT instead of liquidate the annuuity and transfer it and go direct to mutual funds for 1/3 the cost. If I sold nothing but annuities and other insurance products I would be producing 125-150k too. I choose to take a different road with my clients...what is in their best interest not mine. I, most likely, do all the same types of insurance and insurance products as you. LTC, Term and Permanent Life, Disability, and Annuities. I also sell taxable and nontaxable bonds, mutual funds, stocks and CDs. The latter group is the greatest portion of my business. If I did more WL and annuities instead of Term Insurance and mutual funds, I would more than double my production. The only difference between you and me is the investments that I sell my clients. Beware, there are honest guys out there that love to review clients of adivsors just like you. Within an hour most people realize that they are being swindled. There is one reason that you and your peers produce more than me and others like me. You sell higher commission investments and insurance products. Period. [/quote]

THe reason I produce so much is that I stick to one thing. I have a laser focus on what I sell and who I sell it to. I have become known as an expert at what I do because I specialize. I speak with absolute authority in my area of expertise. You, on the other hand, in your naive way, excel at nothing.

[quote=peanutbroker]knucklehead…okay I used the wrong term ACAT instead of liquidate the annuuity and transfer it and go direct to mutual funds for 1/3 the cost. If I sold nothing but annuities and other insurance products I would be producing 125-150k too. I choose to take a different road with my clients…what is in their best interest not mine. I, most likely, do all the same types of insurance and insurance products as you. LTC, Term and Permanent Life, Disability, and Annuities. I also sell taxable and nontaxable bonds, mutual funds, stocks and CDs. The latter group is the greatest portion of my business. If I did more WL and annuities instead of Term Insurance and mutual funds, I would more than double my production. The only difference between you and me is the investments that I sell my clients. Beware, there are honest guys out there that love to review clients of adivsors just like you. Within an hour most people realize that they are being swindled. There is one reason that you and your peers produce more than me and others like me. You sell higher commission investments and insurance products. Period.

THe reason I produce so much is that I stick to one thing. I have a laser focus on what I sell and who I sell it to. I have become known as an expert at what I do because I specialize. I speak with absolute authority in my area of expertise. You, on the other hand, in your naive way, excel at nothing.

"Tax deferral is a concept that allows you to sell, realizing a gain while you have it, yet still not pay taxes on it at the time."

That's certainly one definition.  Reasonable people would agree that another definition would certainly include any investment where taxes are not paid until a gain is realized.  The appreciation on my rental properties is tax deferred.  My income on these properties is not.  My investment in the ABC Widget company is tax deferred.

In my opinion tax deferral would include anything that allows the investor to choose when the tax gets paid.  I get to choose when to sell my Widget stock, thus it is tax deferred.  I get to choose when to sell my rental properties.  In some ways, this can offer better tax deferral than a qualified plan because I'm not forced to sell based upon my age.   I guess that I'm sleazy and stupid.

"But an annuity outside of a qualified plan does not.  So why not use the qualified plans for investments that do not offer tax deferral such as covered call writing, and use VAs as an additional source of tax deferral?"

It's strutting stupidity to ASSUME that tax deferral is a good thing.  Did you not comprehend the other disadvantages of annuities outside of a qualified plan.  (I'm not advocation against non-qualified annuities, but the disadvantages have to be understood.)

"If you put the client into a VA in his qualified plan what else can you offer him that provides tax deferral outside of the plan?"

Growth stocks.  Most likely, we will sell at some point so the deferral won't be as long, but we'll be paying capital gains instead of income tax and we have the ability to match gains and losses.

Peanutbroker,

In my experience, the people who make the most money are the ones who spend the most time with high quality prospects.  I'm not sure that product mix has that much importance.   Top producers don't become top producers by ripping off people.  They become top producers by working their ass off and developing stellar reputations.

Additionally, don't be so quick to dismiss whole life insurance.  Take some serious time to talk to many people older than age 50.  Do a survey and find out how many of them would be comfortable without owning life insurance.  Would their wife be able to maintain the standard of living desired for the rest of her life if he died today without life insurance?   A large portion of these people will put their wife in financial jeopardy if their insurance is term (yet, they followed the "buy term and invest the difference" philosopy.

[quote=anonymous]

In my opinion tax deferral would include anything that allows the investor to choose when the tax gets paid.  I get to choose when to sell my Widget stock, thus it is tax deferred.  I get to choose when to sell my rental properties.  In some ways, this can offer better tax deferral than a qualified plan because I'm not forced to sell based upon my age.   I guess that I'm sleazy and stupid.

[/quote]

Yes you are as a matter of fact.

As I said yesterday, tax deferral is a concept that allows the investor to take a gain, yet defer their taxation on that gain--it is not some odd ball idea that if you don't take your gains you don't have to pay taxes.

You must have been advising investors in Enron--"No Mrs. Johnson, don't sell the stock now because you'll have to pay taxes" followed by, "See Mrs. Johnson, now you have a tax loss that you can use to reduce your income.  Losses are good."

Ridiculous.

If you were worth a tinker's damn as an advisor you'd have your clients in agressive growth situations in their qualified plans, and also sell them Variable Annuities, but outside of the plan.

That way the client can take full advantage of the tax code and grow is qualified plan with things like covered call writing--while also watching the VA sit there and grow tax deferred.

Your approach provides one tax deferred vehicle, mine provides two.

Presenting a common stock portfolio outside of a qualified plan as a tax deferral strategy because the investor never sells the stock, therefore never realizes the capital event, is so dishonest that you should lose your licenses.  You are an embarassment to the industry and should slink away in shame.

It's strutting stupidity to ASSUME that tax deferral is a good thing.

Putsy, best of luck to you.  I'm done spending time on your threads. 

[quote=anonymous]

It's strutting stupidity to ASSUME that tax deferral is a good thing.

Putsy, best of luck to you.  I'm done spending time on your threads. 

[/quote]

Ah, slinking away in shame as I suggested.  It really is best to not continually expose yourself by opening your mouth.

Not selling stocks that have gone up is a form of tax deferral, yep that works.

Anonymous…it appears you have a strong knowledge (at least stronger than mine) of the insurance industry. I imagine you are doing what is right for your client not just what pays you the best. It is just difficult for me to wrap my mind around how/why you insurance guys make so much more starting out than guys at wirehouses. Kucklehead said 150k after two years?!! It seems near impossible to do ethically in such a short period of time.

[quote=NASD Newbie][quote=anonymous]

It's strutting stupidity to ASSUME that tax deferral is a good thing.

Putsy, best of luck to you.  I'm done spending time on your threads. 

[/quote]

Ah, slinking away in shame as I suggested.  It really is best to not continually expose yourself by opening your mouth.

Not selling stocks that have gone up is a form of tax deferral, yep that works.

[/quote]

Putsy, you clown....he didn't say that he was ashamed of anything.  He said he's tired of wasting time with a dung beetle like you.

I wonder if you annuity salesmen would continue to extol the wonderful benefits of VAs if they didn’t pay a 6% commission? 

I wonder if you would sell any at all if your customers knew what you were being paid for the transaction? <!–
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I even wonder if this thread would exist…

[quote=Sailor25]I wonder if you annuity salesmen would continue to extol the wonderful benefits of VAs if they didn't pay a 6% commission? 

I wonder if you would sell any at all if your customers knew what you were being paid for the transaction? <!-- var SymRealOnLoad; var SymReal;

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I even wonder if this thread would exist…
[/quote]

The one I use pays 7.5% and I get 90% of that. It's not much, but I dropped a $100,000 annuity ticket today.

What do YOU sell and how much do YOU get paid?

[quote=knucklehead]

[quote=Sailor25]I wonder if you annuity salesmen would continue to extol the wonderful benefits of VAs if they didn't pay a 6% commission? 

I wonder if you would sell any at all if your customers knew what you were being paid for the transaction? <!-- var SymRealOnLoad; var SymReal;

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I even wonder if this thread would exist…
[/quote]

The one I use pays 7.5% and I get 90% of that. It's not much, but I dropped a $100,000 annuity ticket today.

What do YOU sell and how much do YOU get paid?

[/quote]

This is the same sociopathic behavior that drives the penny stock market.

There are guys out there who figures, "If the person is dumb enought to buy this I might as well sell it to them because if I don't somebody else will."

When all you have to sell is a VA and a life insurance policy the solution to every situation becomes a VA and some more life insurance.

Never let yourself drift to the bottom of the barrel.  There is no pride in being a con man--there may be instant gratification but some day you'll find yourself staring at the ceiling wondering if there is a supreme power that is going to cast you into hell for having been a sleazeball all of your life.

Newbie, I agree with you completely on this one. It's sh*te like that that makes it tougher on all of us and it's just wrong to begin with. The only comfort I get is thinking that karma is going to catch up to them eventually.

[quote=no idea]

Newbie, I agree with you completely on this one. It's sh*te like that that makes it tougher on all of us and it's just wrong to begin with. The only comfort I get is thinking that karma is going to catch up to them eventually.

[/quote]

Your name says it all. It must be a drag that you can't compete with people like me. All I have to do is show people the performance and guarantees and it's a done deal.

I have been losing sleep over this but I'm hoping with time and extensive therapy I might be able rally back!

Just for grins, you should show your victims your commission and the internal expenses on your products.

[quote=no idea]

I have been losing sleep over this but I'm hoping with time and extensive therapy I might be able rally back!

Just for grins, you should show your victims your commission and the internal expenses on your products.

[/quote]

Full disclosure closes more business than anything else...

M&E+Admin = 1.25

Subaccounts = 0.65

Guarantee = 0.40

Avg Annual (net of expenses except optional gurantee) = >20% compared to 11% on S&P

Your ability to compete with this = nil