What does it cost, and what do you make?

Every client asks it, out loud or not. Answer plainly, and before they have to ask. The client decides.

1. 1.

   Say who pays you: usually the insurer, with a commission built into the product's pricing. Name any conflict. Give your real years of experience.

   Fiduciary

   Someone bound to put the client's interest first. For IRA money the federal fiduciary rules have been in flux: ask your IMO what applies.

   Asked "are you a fiduciary?" Don't answer yes or no from memory. Say which products your license covers, how you are paid, and that you follow your state's best-interest rule.

2. 2.

   Some annuities have no contract fee, but every contract has costs or limits. The row reads 1.2% Rider Fee. Show it in dollars.

   Benefit base

   The number the insurer uses to work out income. It is not cash and not the account value.

   Practice Client: a 1.2% fee on a $217,500 benefit base takes about $2,600 a year from the account.

   • See a rider fee in dollars as the account falls
3. 3.

   Asked about a big bonus? Ask what it is for. Then show its possible terms: vesting, recapture, a longer lock-in, lower rates.

   Vesting

   The schedule that decides when a bonus truly becomes the client's. Leave early and part of it can be lost.

   Bonus recapture

   The insurer takes back part of the bonus if the client leaves early.

   An income base bonus is not cash. Read what the bonus is added to and its vesting scale.

   • Compare two contracts
4. 4.

   Show the options that pay you less too, and say why you skip the ones you skip. Each row names its channel.

   A Fee-based row suits a fee-based advisor, not a commission agent. Say so when you skip it.