To download this EYE-OPENING white paper, click on the following link or image:
Want a Customized Version of this White Paper?
I wrote this paper so advisors could use it with clients. If you’d like to use a customized version of this paper with your name and contact info instead of mine, indicate so on the sign-up form to download the paper.
What is a Guaranteed Income Benefit (GIB) annuity? It’s a product that contractually “guarantees” an annual lifetime payment to clients no matter how long they live.
https://advisorshare.com/gib-rider-white-paper
Do you Love or Hate GIB for Life Annuities?
Advisors love GIB rider products…because they provide income certainty for clients.
Advisors hate GIB rider products…because they don’t like the fees (0.80- 1.2% annually), the client won’t need the money (affluent clients), and they think they can do a better job investing their client’s money in the stock market.
Do I love or hate GIB rider annuities?
I don’t love or hate products, but ever since our OnPointe Retirement Planning software could seamlessly integrate GIB annuities into plans, I have a new perspective on these products.
Question: Would clients like a 9.75% GUARANTEED compounded return for up to 10 years?
Answer: 100% of them would!
Question: What if the GIB payment on the “Benefit-Base” at age 65 = 6.27% for a single or 5.77% for a joint life payout? Would clients be excited about these numbers?
If a 55-year-old put $500k into this GIB product, the Benefit Base after 10 years = $1,267,697
What’s the annual GIB starting at age 66? $79,485 (single) or $73,146 (joint-life).
Joint Life expectancy—a 55-year-old couple has a 50% chance one will live to age 92!
If you invested the 55-year old couple’s $500k in the stock market, you’d have to generate a 6.4% NET rate of return every year for 38 years to provide the same joint life income payment. And if one spouse lives to 93 years old, they will run out of assets.
Why Should Affluent Clients Use GIB Rider Products?
1) Even affluent clients need income (so, income from the GIB rider FIA fills that need).
2) When you can guarantee all or a substantial portion of a client’s income that allows you to get much more aggressive with their equities!
Example—60-year-old couple, retiring at 65, $2.75 million in equities, $80,000 in combined SS income at age 65, will spend $200,000 cash in retirement when they turn 65 (I used a 2.7% inflation factor on their expenses and SS increase).
If I assumed a 5.5% NET rate of return on equities (which is more like 7-7.5% GROSS after fees, taxes, etc.), when the clients turn age 89, they will have $4.36 million in investments!
However, if they get a 40% drop in the stock market three years into retirement, followed by two positive years of 20% and 20% (to bounce back), they will have ZERO in their equity accounts at age 89.
What if I moved $750,000 into a GIB rider product and started income in year 11?
With the same rates of return and NO 40% drop, the account value at age 89 = $5.308 million!
With the 40% downturn in year three, followed by the two 20% positive years, the account value when using the GIB rider product = $2.685 million!
When the real world hits clients, GIB riders improve the chances of success by a significant margin (which is why they are a good tool for the affluent (and non-affluent).
This is what the white paper spells out with specificity and why I believe it will be a real eye opener for advisors and their clients.
8 Flaws to Watch for in IRA Conversion Tools
Did you see the ThinkAdvisor article last week with the above title? If not, click on the following link. it’s an article on why I think ALL Roth IRA conversion software in this industry is FLAWED!
https://www.thinkadvisor.com/2025/06/18/8-flaws-to-watch-for-in-ira-conversion-tools
Run Your Own Example Roth Conversion Numbers Using
OnPointe’s NEW Consumer Lead Gen App
We just launched the industry’s most accurate (and I’d say only accurate) Roth IRA conversion software. To try it for yourself to compare it to your current software, click on the link/image below:
