Typically people buying SMA’s are doing their own allocations and investments- they may have a financial adviser or broker who recommends stocks or funds, but if they decide to allocate some $ amount or % of assets to an annuity, they just do it, and tell the broker to liquidate what needs to be sold to fund the transaction.
You may be simultaneously interviewing advisers and also asking them what they think about SMA’s when they know nothing about them. It’s pretty certain they will have resistance and misunderstanding. For one rather crass reason, most advisers would look at any allocation you make to a fixed income annuity as assets NOT under their management, and therefore as assets they can’t charge you an annual fee on.
This may sound harsh, but there is an element of truth- it’s the primary reason traditional money management people don’t ‘like’ annuities. It really boils down to money. Individuals in their 50’s and 60’s should be doing exactly what you are doing- looking for LIFETIME income, and absolutely, positively NOT losing any money.
The most important time in an investor’s life is the 5 years prior to and first 5 years of retirement- losses in that window are devastating. And an annuity insulates from that. Plus, nothing other than an annuity can GUARANTEE that you will never run out of money.
When speaking to main stream money managers, they will talk about allocation models and ‘safe’ withdrawal rates and Monte Carlo simulations of past market performance and future income projections. All this is just hiding the fact that fundamentally, they are gambling. There has never been a GUARANTEED mutual fund or stock, and there never will be. That is the role of insurance (Annuities).
Only annuities can offer the payout they offer, because fundamentally, only annuities offer ‘mortality credits’ which is the extra income you get by buying into an investment pool that has a life expectancy component to it. That is an annuity.
So how to talk to advisers? Invite them to visit this website and learn for themselves. Our phone number is right up on the top and we welcome their questions. You may just find them offering SMA’s to their clients after YOU show them the way!
