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Keto diets are a proven regimen to reduce weight and foster a healthy lifestyle. The financial equivalent – the keto annuity – will drive successful outcomes for your female clients and build a stronger practice.
I learned firsthand of the power of a keto diet.
I gained 22 pounds over a period of 14 months following an accident sustained while playing basketball. I was running fast to the basket in a one-on-one match against a much better athlete… my 23-year-old daughter. Ava deflected the ball, I lost it in front of me, stepped on it, rose up, and then fell down hard with my right elbow taking the full impact of the hardwood floor. Voila! Elbow shattered and triceps muscle ruptured. An excellent surgeon at Mass General repaired the mess in December 2021.
Due to a months-long recovery, 2022 saw me mostly sidelined from my normal workout routine. This gave me plenty of time to spend on something I love, writing. Beginning in February of 2022, when Advisor Perspectives published The Trial of Ken Fisher for Crimes Against Annuities, I’ve written some 60 articles. Being relatively sedate for one-year (plus eating too much) caused the weight gain. I found myself eating late at night. It was difficult to break that cycle, but I eventually succeeded by trying the Keto diet. It worked, or, more accurately, is working, Still have about eight pounds to go.
Financial Keto
The premise behind the Keto diet is to dramatically reduce one’s intake of carbohydrates, which means minimizing sugar intake. Carbs, of course, are converted into glucose-blood sugar. Lowering blood sugar makes you healthier. Then it hit me. What if there was a Keto annuity? Imagine the advantages for strengthening clients’ financial health!
What exactly is a Keto annuity? It’s an annuity without the fattening, unhealthy “sugar.” More accurately, the financially unhealthy equivalent of “sugar”: fees, commission and surrender charges. Annuities that are perfectly configured for the welcoming arms of registered Investment advisors. Keto annuities are readily available to advisors through platforms such as RetireOne, DPL Financial Partners, and others.
The Keto annuity strips away everything except the important benefits annuities provide. They offer the pure and unambiguous benefits of personal finance insurance. Insurance for what? What’s truly important. One’s principal and income.
RIAs love their clients. Love now means never having to say you’re sorry about ignoring longevity! The dramatic debut of the Keto annuity signals that investment advisors will finally be able to address their clients’ long-neglected longevity risk.
Strategic imperative
I have written often about the implementation of annuities as a strategic imperative for RIAs. It’s a matter of having a healthy practice in the future. As women gain ever-more control over wealth assets, there will be inevitable friction. Solutions from male investment advisors typically conflict with the investing objectives and preferences of boomer women. This has been proven by multiple, credible research studies. The misalignment between how men and women view money, between what is recommended versus what is desired, forms what I call, “The Great Mismatch.” The Keto annuity brings incumbent male advisors and boomer women into better alignment.
RIAs should weigh the Keto annuity’s positive impact on their female clients’ lifetime planning. Research from BlackRock and others makes clear that the women worry about outliving their income. Thanks to the Keto annuity, RIAs’ female clients no longer must lose sleep over the possibility that their paychecks will stop. The positive implications for long-term client satisfaction and the maintenance of practice integrity are substantial. For example, your boomer female clients may not feel the need to search for other advisors when their husbands predecease them.
Increase your odds of remaining relevant
Why take a chance on being among the 70% of incumbent male advisors who are fired by widows? Welcoming the Keto annuity into your practice is like purchasing a call option on continuing business success. (I’m simplifying a bit here. Male advisors still face the need to build authentic relationships with the women who will be in control of the money. Recommending the Keto annuity, however, will hasten alignment and make surmounting this challenge easier.)
Perfect alignment with the RIA business model is a feature of the Keto annuity. It integrates with leading portfolio management applications and can be seamlessly “wrapped” like other positions. There are even specialized variations of the Keto annuity. Some, for example, are alternatives to fixed income. Others can be used as shorter-term, higher interest rate alternatives for cash positions. Still others are optimized for providing lifetime-guaranteed income. It is in RIAs’ best interests to embrace the Keto annuity. More than adding a new dimension of planning capabilities, RIAs will be in a stronger position to defend their AUM.
Sharing news that generates revenue
Once you have integrated the Keto annuity into your practice, the next task is to share the news with clients. This will surface clients who own traditional annuities, assets that you will surely be able to replace with the Keto annuity, directly leading to increased top-line revenue.
To avoid furthering the “great mismatch” between female clients’ needs and male advisors’ solutions, strategic communications on the issue of retirement income planning should become an urgent priority. It’s a missed opportunity when advisors fail to address such an important issue prominently on their firms’ websites. Unfortunately, communications on the topic of retirement income have been so bizarrely neglected by RIAs, I produced a video on this crazy reality called, “RIAs Don’t Tell.”
Forget the word, focus on the benefits
“Annuity” remains a highly charged word with negative connotations in the RIA community. There is historically based validity to this perception, but also a fair measure of hypocrisy. With the appearance of the Keto annuity, it’s time to put the word aside in favor of focusing on the benefits.
For RIAs to remain frozen in a state of annuity skepticism is nothing less than a guarantee of business decline. Demographics point to this inevitability. Virtually the entire pool of wealth assets will soon be under the control of boomer women. The number-one planning imperative will center on providing lifelong, inflation-adjusted retirement income. To deny the role of annuities in this context is a strategic bunder that will thrust many men right out of the advisory profession.
Wealth2k® founder David Macchia is an entrepreneur, author, marketing strategy expert and public speaker whose work involves improving the processes used in retirement income planning. David is the developer of the widely used The Income for Life Model®, and the recently introduced Women And Income®. David has authored many articles on the subjects of retirement income planning, macroeconomics, and financial communications. He is the author of two books, Constrained Investor®, and Lucky Retiree: How to Create and Keep Your Retirement Income with The Income for Life Model®.
Advisor Perspectives welcomes guest contributions. The views presented here do not necessarily represent those of Advisor Perspectives.
