700 WASHINGTON AVENUE
CARNEGIE, PA 15106
PHONE: 412.446.1300
FAX: 412.446.1350
BARBARA.BRADAC@ CAPITASFINANCIAL.COM

Annuities

Fixed Annuities

With the current interest rate environment, it’s hard to get by on “just rate.” This isn’t 2007 or 2008. With that said, rates on fixed annuities are competitive and a good investment in comparison to other fixed alternatives. The features found in an annuity only increase their value and separate them from the other fixed alternatives.

We believe there’s a 3-pronged approach to ensuring your producers are presenting annuities confidently to their clients & prospects:

1. Everything is Relative

Fixed Annuities have a good return compared to the other options that a client has for parking their funds. As of Friday, the highest yielding CD in the country offered 1.46 % for 5 years, and the average yielding money market was about 15bps (bankrate.com). Fixed Annuities are very competitive given what the market is bearing right now. Remember to use www.bankrate.com as a tool.

2. The Cost of Waiting

Clients are giving up a lot of money waiting for rates to go up. History tells us that rates go up gradually- They most likely won’t double in 12 months. With the 10 yr treasury closing at 2.19% on Friday the 26th, now is the time to take advantage of higher yielding products that offer liquidity. The client’s money is put to work now, and there’s a hedge built-in if rates do move up quickly. Compared to the average yielding jumbo CD, a client is giving up more than $1,500 per year per $100,000 by not taking advantage of a 3% fixed annuity(Rate Saver 7 yr 100k).

3. Use an Illustration

An illustration is a graphical way to show a client that their money in a fixed annuity is always growing. The majority of the population learns & understands by seeing something visual. The illustration re-enforces that your money is growing, and it gives an agent the ability to explain all of the features of the annuity.Clients should be looking at rate as only 1 feature of an annuity and having their agent help them answer “What am I getting for that rate?”

Fixed Annuities can be a great fit in any rate environment if you sell features, use visuals (illustration), and confidently convey how the product fits in a client’s overall portfolio.

Click here for Annuity Forms and Information

For all of your annuity questions, please contact our Annuity Specialist, Greg Hall, at 412.446.1312 or greg.hall@capitasfinancial.com.