Have an ACE up your sleeve?
By Jason Kestler
Kestler Financial Group, Inc.
When business is slow, wouldn’t you like to be able to pull an Ace out of your sleeve? Now you can — with the annuity capital enhancement (ACE) program!
Use ACE to create new sales (and commissions) with existing clients. Or, use it to prospect for new clients. Here are situations where the ACE program could work for you:
• Clients with non-qualified annuities who plan on passing the proceeds to heirs
• Clients with qualified funds who need little or no income from these accounts and plan on passing the proceeds to their heirs
• Clients taking required minimum distributions (RMDs) from qualified plans
• Annuity or qualified account owners who have charitable inclinations
• Clients who need income from their annuities or qualified plans, but also want to pass on money to their heirs
If you have clients who could say “yes” to any of these red flags, ACE is for you! Here’s an example:
A male, age 70, with a non-qualified annuity worth $250,000, growing at 4 percent per year, with a $175,000 cost basis. At a life expectancy of about 15 years, this would grow to about $450,236. Upon his death, the effect of income and estate taxes would devastate the account. Only about $180,000 (40 percent) would pass on to the heirs.
With ACE, you could show this client how to pass on $416,000 — tax-free! At the same time, this transaction would generate over $25,000 in commissions.
ACE is not a product but a sales concept that makes money.