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Annuities Are the Cure for a Risk-Infected Retirement

Successful salespeople do not see themselves as “salespeople,” nor do they act like them. Instead, they believe they are experts who take a consultative role with their customers. They understand who their customers are and what they want and need. They have an expert level of knowledge of their products and services and know how they can benefit their customers.

This is especially true when presenting annuities to prospects. Before you can sell annuities, you must learn to serve your clients effectively. Any positive business or service relationship begins with a level of trust and mutual respect. A great way to develop trust and respect is to have your clients’ best interest at heart and focus on serving their needs. Do you see yourself as an annuity salesperson or as an annuity consultant? How do you want your clients to see you? Consult with them; don’t sell them.

Here are three tips to help you take the focus away from selling annuities and focus on being an annuity consultant.


1. Know Who You Serve – And Keep Them From Making the Wrong Choice

Ask yourself the following question: Who do you serve? Your clients, of course! They rely on you to make recommendations for what they want and need.

However, sometimes the best way to serve your clients is to tell them when an annuity is wrong for their financial situation, needs and goals. Clients need you to help guide them to the right choice for them, even if an annuity is the wrong way to go.


2. Build a Positive Relationship

Why should someone buy the same thing from you that they could buy from 50 other people? Maybe it’s because they like you. Maybe it’s because you are knowledgeable. It is not because of the amazing products you sell, because prospects can buy them from many other sources.

Most likely, your clients are buying from you because they are buying you. Building a positive relationship with clients based on mutual trust and respect is not easy. But it is worth every minute of effort and can lead to win-win scenarios.

Win-win scenarios can happen more often than you think. Your clients can get the right products and services they need, and you can get paid to assist them. It’s easy to uncover the win-win. Start by finding out what your clients want and then work hard to give it to them.

So why aren’t more of your clients and prospects telling you they want to purchase an annuity? When was the last time you got a call from a prospect asking for an annuity? Probably never. Why? Because most consumers — and even many advisors — do not really understand annuities. Those who say they hate annuities may have the least amount of knowledge about them. They need help, information and, most important, guidance from a professional they can trust.

Your clients want and need guarantees for their retirement plans. They simply do not know that an annuity may be the vehicle they need to achieve these guarantees.

No one wakes up in the morning and says, “I need an annuity for my retirement plan,” but many people stay up at night worrying about how they will protect their money from market loss, inflation, taxation, longevity, fees and more. They want to ensure that they will not run out of money in retirement. Therefore, it is not the annuity but rather what the annuity can provide that your clients want and need. You simply need to help them see what it is that they truly want and then give it to them.


3. Educate Your Clients

What do your clients know about annuities? How much of what they say they know is fact and how much is fiction? Ask questions and find out. Your clients probably know much less about annuities than you think.

I have come to learn that most people — including the successful, educated and wealthy — know very little about investments, insurance products and retirement planning overall. This is where education is essential. You must learn what your clients know and do not know about annuities.

Imagine you are a doctor prescribing an annuity to your patient as a cure for a retirement infected with risk. Just as your patient would need more information before agreeing to swallow an antibiotic for a bacterial infection, your client probably needs more information before they swallow the annuity pill. And just as your patients would want to know that they are working with a real doctor, your clients want to know they are working with a bona fide professional.

Recommending an annuity is like writing a prescription. A doctor would not write a prescription for an antibiotic unless a bacterial infection was present in a patient. Annuities are like antibiotics in that there are many different types and a variety of potential uses. They vary in terms of strength, pricing and side effects. Specialized antibiotics have been developed to fight specific types of bacterial infections. Similarly, specialized annuities have been developed to fight specific types of retirement risks, improve financial health and promote overall wealth wellness. Know what ails your client, and write a prescription for the appropriate annuity that best serves them.

Providing honest and objective guidance for the selection and use of annuity products is critical. There are many types of annuities and many potential features associated with each type. Proper placement and use of annuities within a comprehensive retirement plan can improve most retirement plans. Your job is to teach, show and explain to your clients why annuities may be right for them.

Study the products and services you offer to the degree that you would consider yourself the authority on them. Make recommendations wisely, and be prepared for tough questions. Embrace tough questions and even objections, as they are opportunities for you to educate your clients. Spend time to prove to customers that your relationship with them is more important than a transaction.

Do not cut corners or offer partial truths. Cutting corners and engaging in high-pressured sales tactics are dangerous practices — dangerous for your client and dangerous for you. Not only will this lead to fewer annuity sales, but it also will likely lead to complaints, fines and ultimately a failed career.

The financial services industry already has a bad reputation in the minds of many. Please do not make it worse. Instead, make it better. Put your clients’ interests first, and strive to give them what they want. Success will follow, I promise. So, stop trying to sell annuities, start serving your clients’ needs and watch your annuity sales soar. 

Justin Fort, RICP, ChFC, CFP, MSFS, is president of Fort Wealth Management, Austin, Texas. Justin may be contacted at [email protected] .

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