Annuity Statements of Understanding: Flushing Out The Truth

Hi there, Stan The Annuity Man, America's annuity agent. Yes, Stan knows. Bo does not know. I know Stan knows because Stan is The Annuity Man and the number one agent in the country, and I'm obsessed with T-shirts with all of my stuff on it and hats and all that stuff. And no, my underwear does not have Stan The Annuity Man on it. But my pants do. People say, "What are you doing?" Hey, midlife crisis, right? It's better than drugs and alcohol. Tried that one. Long story short, what are we talking about today other than me? We're actually talking about you. We're talking about the annuity statement of understanding. What the heck is that? You have to protect yourself out there in the wild, wild west of annuity sales, and I do mean that. It's not the carrier's fault.

Annuity Sales Environment

The carriers try to police their army of agents as best they can, but in a commission world, the truth will be pushed a little bit. The facts will be enhanced. The limitations will never rise to the top. So, how do you protect yourself? You have this trusted advisor or the person you've worked with all of your life, and suddenly, they're pivoting, saying, "You need this annuity. This annuity is perfect for you.

What do you do? I'm going to tell you what to do, and once I tell you what to do, it will be the greatest thing of all time because it will put you back in control.

Personal Anecdotes

I'm getting a lot of emails. They're like, "I see all these Stan Knows shirts, different colors and everything," and people are like, "How many did you buy?" I'm like, "Every color they had." I do nothing in moderation. I knew at that moment in time that Nike was going to sell these shirts. They'll let you customize. So, I went at it. My wife's like, "How many did you buy?" Long story.

So, an annuity statement of understanding. When you get the sales pitch from the annuity agent, and boy, does it sound too good to be true, you're at the bad chicken dinner seminar or you're at the expensive steak seminar. By the way, I used to use "bad chicken dinner seminar," and I pretty much coined that phrase, but then the agents figured out, "Well if we sell these really high commission products, we can literally serve steak."

So, now it's like steak. And by the way, my mom, who lives in St. Augustine, Florida, is 80 years old and getting ready to turn 81; I want to thank all the annuity agents in St. Augustine, Florida, for feeding her over the last five to 10 years in that area. She goes probably two times a week to eat at the bad chicken dinner, bad steak dinner seminars that sell annuities. They don't know that she's The Annuity Man's mom, and they would probably go, "Oh my gosh." But she's at the point where I call her a professional plate licker, which means that she will go to every single one and call beforehand and say, "What are you having for in addition to the steak? What type of dessert are you serving?" Now she's from the south, so dessert is important to her, and she'll literally go, "I didn't go to that one, Stan, because I don't like that kind of dessert. I didn't want to eat that."

I'm like, "Oh my gosh, give me a break." I'm going to get to the annuity statement and understand, I promise you. But here's the other story that was great. She called me the other day and said, "I'm going to another seminar." I'm like, "What annuity is it?" She goes, "No, it's for crematory services." I'm thinking to myself, "If that person is giving that cremation presentation with food, and if they don't serve burnt ends or charred chicken or blackened fish, that's the time to serve it. Why? Because you're doing cremation." I digress. Stay with me here.

Annuity statement of understanding. So, when a person pitches you something, it sounds too good to be true, but you believe them and you say, "You know what? We're going to move forward with that." I need you to write down every single thing that the annuity agent says about the product.

Writing Down the Pitch

The way that you understand it, the way that you interpret it, the way that you think the product's going to work, write it down in detail, every single detail. They say "7% interest." Write down that you think you're going to get 7% interest, real interest, which you can peel off. Write it down like that. They say, "Market upside with no downside." Say, "I'm going to get market returns and my principal is protected. This is what the agent said and guaranteed." Write it all down in detail as far as you want to go. Sign and date it at the bottom and then do this. Flip the page around. Slide it to the agent that pitched you the product and have them sign and date it as well. Guess what? If they've told the truth, they're going to sign and date it eagerly. If they're a sociopath, they're going to sign and date it eagerly.

Verifying the Information

But if they told a little white lie or they read it and go, "Uh, I don't think that's it," they're going to have to clarify that message or they're going to have to back away from the sale. Either way, you're in control. Either way, you're flushing out the truth of that sales pitch. It's unfortunate that you have to do that, but in the world that we live in or the wild, wild west and any type of commissions, annuities, there's no more bad people in the annuity world than there are in any other sales world. Anytime people are incentivized by commission, trips, gifts, or whatever to sell something, they're going to push the limits. Some of them are, some of them aren't. Most annuity agents don't do this, but many of them do, especially in the Indexed Annuity world; they will push the limits. But just write down exactly what that agent said, how you interpret it, and how you think it will work. Sign and date it and have them sign and date it as well.

Protecting Yourself

If they sign and date it, you make a copy and put it in your file. And then when you get your policy, you fax that copy to the carrier or call them about it and say, "Okay, here's what I was told this policy does." And the carrier will tell you if that's true or not. If the agent signed it and they're a sociopath and say, "Well, I'm just going to take my chances," you're going to be able to flush out the truth. The other good news about you being in control, the statement of understanding will flush out the truth of that sales pitch. But let's just say you buy the product; you still have to make the call into the annuity company to make sure that what you understand the product will do is going to happen and you haven't just been pitched some dream or some unicorns chasing the butterflies, the planets align themselves, too good to be true product.

Using the Free Look Period

If it comes back from the carrier that no, it doesn't do that. No, it doesn't do that. No, it's not going to perform like it was pitched, then you can get your money back. The annuity industry is the only industry on the planet in the financial services world that will give you your money back. They'll let you test drive that product, for lack of a better phrase, and get your money back without hesitation. You don't have to provide anything other than a phone call and saying, "I bought this product. I'm within the free look time period; each state has its specific free look time period, and I want my money back." They will send it to you. The annuity company will send it to you without question, without any forms or anything.

Conclusion

You might have to sign a form that says, "I want my money back. Send it now." But you don't have to go through a litany of the reasons why. There are no reasons why. You're in control with the statement of understanding, and you're in control with a free look time period to protect yourself from a fraudulent sales pitch, a misleading sales pitch, an overhyped sales pitch, or a high-pressure sales pitch. The bottom line is there's never an urgency to buy an annuity. And you're listening to the top agent in the country who's licensed in all 50 states. I've been doing this for a long, long time. The only urgency is for you to understand the good, the bad, the ugly, the limitations, and the benefits of the product. That's the urgency. Then, you make your decision on your terms and your timeframe.

Contact Information

If you go to The Annuity Man, you can download all my annuity books for free and under no obligation. You can schedule a call with us, and yes, you will talk to my team one-on-one, and we can decide if an annuity is right for you and, if so, which type. Then, we will talk about allocation proportion strategies and what you're trying to achieve. We'll quote every carrier using our proprietary annuity calculators to help you find the highest contractual guarantee for your specific situation. So, with that, I appreciate you joining me, and I will see you on the next Stan The Annuity Man blog.