Allianz Inflation Adjusted Annuity Payments

At this point, it might seem like I’m picking on Allianz, but that isn’t the case. What I’m really trying to do is help people understand how aggressively their products have been sold for years, and why so many people are unhappy now, to the point where they’re leaving Allianz en masse.

Inflation has been a hot topic for the last several years, and the folks pushing Allianz annuity products put a ton of hype into their inflation adjusted annuity payments. But before you buy into the hype, let’s break down what’s really going on.

When advisors selling Allianz talk about inflation adjustments, they make it sound like you’re getting a great deal. And on paper, it does look good. But here’s the reality:

If you choose an immediate annuity with an inflation adjustment, you’re either going to pay more upfront or start with lower income.

I’ve been documenting this stuff for 10+ years. In fact, almost 6 years ago, I wrote about using annuities for inflation. In the example I gave in that newsletter, if you put $100,000 in an annuity without inflation protection, you might get $548 a month. But if you want that payment to increase over time, your starting payment would drop to $405 a month. That’s a 30% reduction just to have the potential for your income to grow. And even then, it could take over a decade for your payments to catch up.

There’s hardly any value in that.

You can even see last year when I broke down the Allianz Benefit Control annuity product, where advisors were showing cash value increases and continuing to increase substantially after the cash value goes to zero.

Index annuities don’t grow when cash value is gone.

Allianz is not the only company with products like this but they have the most aggressive marketing so more people see the outlandish claims. I’ve heard about it so many times, and these claims have been part of many of my newsletters, including my somewhat famous B.S. Annuity Illustrations newsletter.

That’s why I’ve never sold annuity products this way. My approach has always been to find the most efficient payment stream, for the lowest for the lowest possible price, and you can use the money you save any other way to handle inflation.

Inflation is a big deal, and it’s something that certainly needs to be considered. But don’t let it scare you into making bad decisions. Take your time, do your research, and make sure you’re getting the best deal for your money. And remember, sometimes the simplest solution is the best one.

If you want a simple solution, book a call with me. I’ll help you find the best deal for the least amount of money, and you can go about living life without worrying about whether some fancy projection will come true or not.

Have a great weekend,

Bryan Anderson

Podcast Episode 148: Allianz Inflation Adjusted Annuity Payments

Download The Episode Allianz Inflation Adjusted Annuity Payments on Apple Podcast

Last Updated on August 24, 2024 by Bryan Anderson