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A History of Blood – Vol. 2, Chapter 11

Moving to Florida means transferring my resident insurance license, updating my contact information across a dozen different accounts, rewriting my business plan and registering it Florida, among other things. The end result will simply be my main office being based in Tampa, Florida, as opposed to Baltimore, Maryland.

Life Insurance AND Annuities

When most people hear the title, “insurance agent” they usually don’t think of retirement options, which is why I love teaching people about annuities

An annuity is a contract between you and an insurance company where you pay a lump sum or series of payments, and in return, the insurer provides regular income payments either for life or a set period of time.

Annuities are designed to protect against the risk of
outliving your savings, offering financial security during retirement. They can also provide tax-deferred growth, allowing your investment to compound without immediate taxation.

I’ve found that the “sweet spot” for annuities is about $1M. The strategy is simple: keep working until you have purchased $1M in annuities and made $1M over your working career.

The average working career is about 35 years, meaning you realistically only have to earn $30K a year to earn $1M, but earning more would allow you to retire faster.

Leaving for the weekend

At the office today I probably ran 10-12 illustrations, focusing mostly on the different annuity products in my current catalog.

I learned that some of them have pretty wild capabilities, with the advantages being significantly more noticeable at larger amounts of money.

For example, there is a single purchase annuity with an 8% interest guaranteed for the first 5 years. The minimum amount is $10,000

8% of $10,000 is $800 which is already insane, but;

8% of $1,000,000 is $80,000.

I had a conversation with another broker whom likes to gamble. He told me one day he won it big and didn’t know what to do with the money. Next time I see him I’ll send him an illustration.

I’ll let him know that the next time he wins it big he should consider an annuity: not only will that turn his one time win into a lifelong cash flow, but it will also help him avoid the hefty tax penalties associated with earning large amounts of money (but that’s the subject of another day).

The Fast Life

I’ve always known that “winning the lottery” was a great reason to purchase an annuity, but I never thought about creating a marketing campaign about gambling, since I don’t actually gamble myself. I love watching sports (especially baseball, basketball and MMA) and I love going to the casino but I never thought about creating a marketing campaign around the two.

There’s an inherent thrill or agony of watching sports that makes sports betting particularly interesting to me. You can double down on your favorite teams, athletes, or experiences and the idea of “purchasing annuities (or event tickets) with your winnings” allows me to leverage sports analytics and culture in my marketing.

A “performance bonus” for a fight pursue, or a contract signing is also another really good reason to purchase an annuity. Athlete salaries tend to be extremely high so naturally they are looking for ways to minimize their tax liability, which we will talk about more in our next few articles.

The Lifestyle

As an insurance agent, my job is pretty simple. I sell life insurance and annuities by nomination or referral.

What that means is, there typically has to be at least one person outside of the client that can give a positive recommendation of the client. Sometimes that person is a friend or family member, sometimes it’s an acquaintance or associate, sometimes it’s their spouse; the point is that I don’t do business with strangers.

I attend a lot of social and professional events. The social events are typically for screening new prospects while the professional events are where we get down to business. In the past, the struggle was making sure I maintained a license in all the appropriate states since I travel so often.

Once I’m done transferring my resident license to Florida, I plan on purchasing a few non-resident licenses as well. After that, I’ll have to do a few business trips to meet some old friends, and hopefully I’ll be able to make some new ones in the process.