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I was recently speaking with one of the top financial journalists in the country about annuities and the current environment with the COVID-19 situation. This person writes a syndicated column, appears on TV regularly, and is the author of many best-selling books on personal finance.

I was hoping that I wouldn’t have to write this article, but I’m starting to receive “fear selling” email messages from some of the carriers, distributors, and many agents promoting annuities during these Coronavirus times. I’m sure the TV ads, radio ads, and direct mailers aren’t far behind.

Annuity sales continue to rise every quarter in the United States, and a lot of the credit for driving this consumer popularity is the Annuity Income Rider. So how do Annuity Income Riders work? Riders are separate benefits that you attach at the time of application.

One of my favorite sayings is “There are NO perfect annuity answers...just bad sales pitches.”

Unless you work for the government or are a select union member, there’s a good chance that you do not have a pension waiting on you on that last day of work.

Two of the most frequently asked question that I receive are “How does longevity insurance work?” and “How much does longevity insurance cost?” Solving for longevity risk is making sure that you will never be running out of money and that you have a sufficient lifetime income stream hitting your bank account regardless of how long you live.

It’s kind of sad that the annuity category is experiencing somewhat of a renaissance during this Coronavirus crisis. It kind of makes sense that contractual guarantees become a little more attractive when the future is a tad hazy and unpredictable. In addition, stock market volatility always makes people reassess the overall risk in their portfolio.

In my opinion, annuities should not be looked at as investments. They are contracts issued by life insurance companies. Don’t believe me, then buy one and you will receive a contract (i.e. policy) in the mail.

Many investors are familiar with bond ladders or CD ladders, and might already have these types of strategies in their retirement plan. Laddering annuity contracts is a new concept to most people, but you should definitely be aware of these unique strategies for both lifetime income and principal protection.

The hottest “sounds too good to be true” and “best thing since sliced bread” product to hit the financial world in the past few years is the Fixed Index Annuity (FIA). Regardless of your specific financial goals, some agent or financial advisor will most likely pitch you this product…

If you grew up in rural America, you remember the outside water spigot we used with the garden hose and to fill buckets. Imagine if you mistakenly ripped or broke the knob off of that faucet. If that happened, water would flow uninterrupted until you got someone to fix it.

Annuity sales continue to rise every quarter in the United States, and a lot of the credit for driving this consumer popularity is the Annuity Income Rider.

There is a reason 3 guys are wearing both “belts and suspenders” in the picture with this article. It’s not because I grew up in the south and that’s how my Uncle Joe looked at the family reunion! It’s due to the fact that some people mistakenly think using IRA money to fund annuities is duplicitous.

We are currently witnessing market movements that in the past took years that now happen in a day. 500 to 1,000 point swings are commonplace and investors are becoming numb to this type of violent volatility. These types of market swings are great if you are a trader or a hedge fund manager.

For people that enjoy reading the IRS tax code in their spare time, I would encourage you to flip to section 1035 and read about life insurance and annuity transfers. For those of you with a life, just let me explain the important details so it’s easy to understand.