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Lifetime Payouts


SCOTTSDALE, Ariz. - Investors and financial planners still have yet to uncover the tremendous benefits of annuity lifetime payouts but are slowly getting the message, thanks to such efforts as those of Ben Stein, this year's honorary chairman of the National Retirement Planning Coalition. As well, the National Association for Variable Annuities (NAVA) will be training 1,000 top producers throughout the country on variable and fixed annuities.

Those were NAVA President and CEO Mark Mackey's remarks in introducing Stein, this year's keynote speaker at the Variable Insurance Products conference here last Monday.

"We expect a very enthusiastic response," Mackey said.

Besides the importance of getting the complex message of annuities' role in retirement and tax planning out there, Mackey and other speakers said, the annuity industry must sidestep the turmoil rocking the mutual fund industry.

The insurance industry must "protect [its] integrity and reputation," particularly in light of the increasing importance of lifetime payout and retirement planning to sustain the aging U.S. population and the fragility of the Social Security system, Mackey said. "Millions of people don't know if they will have the economic resources to sustain themselves."

Steinspeak

Stein, author, economist, former White House speechwriter and recognized for his role in "Ferris Bueller's Day Off," and as the host of the game show "Win Ben Stein's Money," commended the industry for its role in protecting the nation's retirement wealth. After asking a ballroom filled with more than 1,500 insurance executives to recognize the troops in Iraq with 10 seconds of silence, Stein later related the importance of the work of the annuity industry to those serving and protecting our country.

"It's really, really wonderful, that thing you guys sell. Peace of mind, as opposed to fear," Stein said.

While as popular as last year's chairman of the National Retirement Planning Week, former presidential candidate and Senator Bob Dole, Stein apparently has been, and will continue, to crusade on behalf of the annuity and life insurance product industries.

To date, Stein has made more than 87 media appearances on such outlets as NBC's "Today" show, reaching a total of 9.6 million people on TV. Between broadcast television, radio and the Web, NAVA calculates the popular author and personality has made 56 million media impressions with the message.

And that message is oft filled with Steinspeak.

Out of Breath'

Driving home a message of diversification on "Today," Stein spilled forth a litany of investments he calls sound, recommending: "REITs, emerging markets, stocks, bonds, real estate, more savings in cash, and especially annuities and variable annuities. Only they promise to keep paying you until you die -- or until you're out of breath," Stein deadpanned in his rapid-fire trademark style.

In another video clip, Stein brings annuities to life and relevancy by talking about the "revolution in self-awareness and saving enough money for retirement."

"It ain't fun to be poor, and it ain't fun to be poor and old," Stein said, noting that the average American has less than $50,000 in retirement savings. Annuities are a way to transfer the risk of outliving one's money to the insurance company, he added.

Ben Stein's Parents' Money

Stein, who is also scheduled to testify before Congress this Wednesday, revealed that he himself owns annuities from TIAA-CREF and Met Life, and that he first became aware of annuities when the TIAA-CREF policies his parents owned ballooned into a "breathtaking" sum of money.

"An amazing bounty came pouring out of their VAs," Stein said. The retirement pool permitted his parents to buy a "great apartment" at the Watergate, a home in Florida, and to set aside educational funds for their children and grandchildren.

Stein, whose most recent books include "How to Ruin Your Life" and "I Hate This Place," joked that he is often already doling out money for his own children, including a $1,000 bribe to get his son to cut his long hair.

In sum, Stein defined a VA as simple peace of mind. "It's getting a good night's sleep," he said, "going to a doctor of your choice, the freedom to do anything you want."

Shift the Focus

Applauding Stein for his ability to bring the message of VA benefits and tax deferral to the masses, NAVA Chairman Jane Mancini advised carriers to contest potshots against variable annuities by confining the debates to specific categories, such as taxes and disclosure.

If the message is conveyed correctly, Mancini went on to say, "The investor will develop a complete understanding and comfort with what we have to offer."

Copyright 2004 Thomson Media Inc. All Rights Reserved.

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