Another Allianz Dud
On average I have a conversation about these products at least three times a week. No matter what the typical customer experience is with the Allianz 222 or Allianz Benefit Control, agents still sell it like crazy and it’s time the industry wakes up. Sadly it probably won’t happen anytime soon so I’m here to remind everyone that these contracts will do exactly what they are built to do. You’ll get safety, some growth, and have the option for guaranteed income at some point but you will not get double digit performance and you have to set very conservative expectations. Those who believe the incredible hype will almost certainly be disappointed and I’ll show you proof of one such example today.
For the record once again, I don’t dislike these products. I dislike how they are sold. Too many times I’ve seen someone count on the crazy numbers from an illustration and when it doesn’t work out it puts them in a financial bind. It defeats the purpose of using annuities for retirement. These cases come to me all the time. Most are surprised to hear that the hypothetical income numbers are not guaranteed, indicating that the salesman didn’t even explain the contract to them. Most focus goes to the bonus and again it’s not even real money with few understanding how it really works. In far too many cases it’s dinner seminar bait and nothing more.
About a month ago, I got a call from a lady in Arizona. She has no dependents and wants to maximize income in five years. A local agent who seems to be a jack of all trades recommended the Allianz ABC because it’s the agent’s favorite annuity. That’s the first red flag. My favorite annuity is irrelevant. What’s important is the one that works best for you. I found out that Nationwide would pay her guaranteed income that substantially exceeded the hypothetical projection from Allianz. As luck would have it, just the day before I met with another lady who bought the same product almost four years ago.
This is what she wrote about her goals for the appointment: Looking for best annuity options for $125-150,000. Have 2 annuities with Allianz for $300,000 and am astounded at the difference between what was projected and what will be reality.
It kinda sounds like her experience is exactly what I tell people to expect. She’s looking to buy another annuity and it sounds like it won’t be another Allianz product. Nate took this appointment and this lady was kind enough to send along statements to explain her point. Let’s have a look at just one of them because they both did the same thing.
Well isn’t that impressive! The protected income value has grown by a whopping 2.32%, that includes the bonus and additional interest credits that is used to calculate the guaranteed income. It’s a far cry from some of the double digit projections that a lot of these agents illustrate and that’s why so many people are disappointed. The cash value is another story with an average yield of .46% since inception, limiting future opportunities if a change is desired. Wake up to the reality if you need this for a critical part of your retirement. If you just want to protect money and the cash flow option is nice but not necessary then go ahead so long as you won’t be hurt if it doesn’t work out.
The owner of this contract is expecting a healthy income stream. So what does she get for $300K locked up four years ago? As it stands now, Allianz will pay her about $18,200 per year for the rest of her life. It should be nearly twice that given her parameters. Even if she surrenders the contracts and loses a bunch of money, Nationwide will guarantee right about $30,000 per year so she can salvage something good out of it. Salespeople favorable to the ABC will brag about the increasing income that boosts payments every year by the amount of index growth. But with performance like this the owner would have to live to be 150 years old before the inflation adjustment catches the Nationwide payment.
True inflation adjustments happen in a different way. Buy the most efficient income stream you can and put the extra money into other investments to grow. When you need to adjust spending it will be there for you. Don’t count on a hypothetical from an insurance company. I told all of this to the lady from Arizona and I don’t know what she did with it. She was ready to do the paperwork for something and I never heard from her again. I don’t know if she bought something from the accountant/bookkeeper/real estate agent/annuity salesperson but I can tell you that she didn’t do business with me. So what if I didn’t make some money this time? I’m not the one who will suffer the most because of this. What she is likely to lose is multiples of whatever I would make.
I know a few people who are perfectly satisfied with their Allianz contracts. They put conservative expectations on it and allocated a relatively small portion of overall assets to the contracts. All of them are fairly young as well and they have time to do things differently if the contracts don’t meet their needs going forward. Anyone who counts on the income in the future should pursue the highest guarantee on the market. You’ll save the money upfront and open up planning opportunities in the future. Of course you can do whatever you want with your money, but you won’t be able to say I didn’t warn you.
Have a great weekend!
Bryan
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Last Updated on November 5, 2025 by Bryan Anderson
I almost got bamboozled from one of those dinner seminars with a guy pushing Allianz. I knew zip about annuities at the time, but could spot red flags all over the place.
Thanks for helping me out with a better product to match with my retirement goals. And thanks for publishing such helpful content. You should sleep very peacefully at night Bryan. 🙂
I have an Allianz Master Dex X policy that was sold to me 13 years ago.
The agent either lied or didn’t understand what he sold me as he told me there was a 6% bonus and “guaranteed” 7% increase every year for 10 years. The 6% bonus was credited over 10 years, not immediately. The 7% increase was simple interest, not compounded and was only for a total value
that I could take lifetime withdrawals from. I invested roughly 100K. After 10 years, while my hypothetical value was about 176K, my walk away value was about 130K, less than a 3% return over 10 years. This was much less than the 7% he said was my guaranteed return. When I approached him on this he said that the income rider, based on the 176K was why he sold it to me. My 7.8K yearly income from this will take 12 years just to get back what I invested before I see any return. He sold me snake oil! I didn’t even get a free dinner out of it!
A lot of free dinners offered here in the Villages Florida area. But having been to one a few years back, I learned that those free meals come with a price. I say be careful. Give Bryan a call after you obtain a little information from the meeting. Just don’t tie up your dollars until you at least speak with Bryan. He is a world of helpful information. You’ve worked hard for your money, don’t throw it away foolishly. There are a lot agents that go with their companies unscrupulous sales tactics. When these agents take the companies tactics and coordinate their own unscrupulous tactics, just be aware.