It’s amazing the number of financial advisors who still think insurance is separate from investment planning and will embrace any non-insurance option rather than use insurance or annuities to address their clients’ needs. Increasingly, there are insurance products that bridge an important gap.

If, when you are 35 years old, and you do something stupid, there are many years stretching ahead for you to recover from your mistake and attempt to make better decisions. But if you are 65 years old when you have a similar lapse in judgment, an individual client doesn’t have the same “unlimited” quantity of time to recover. The idea of waiting it out is not so appealing. We know that “ups” are followed by “downs” which in turn are followed by “ups”. We call this volatility but then there is short term volatility and there is long term volatility and that’s the problem when you are 60 plus years old.

At Florida Wealth Advisors, we call risk and volatility “stress”, and a reason why some clients eventually change advisors. Because like all investment options the advisor might recommend, there is always a chance it won’t work. But only the client loses.

One investment recommended to stabilize an investment portfolio is a Managed Futures Account (MFA). The MFA invests long and short, mostly in commodities, to generate an acceptable result in an otherwise volatile market while (allegedly) minimizing risk and volatility. Volatility can also be mitigated by “time”; something you may or may not have to play with.

On the other hand, insurance companies do have time, and they accomplish much the same thing as the MFA by investing long, real long in some cases. You see, they plan on being around for 100 years or more (many already have been) and they can transfer their advantage of unlimited time to us in the form of insurance and annuities that guarantee results no matter how long or short our time horizon.

Annuities guarantee income that will last as long as the client does. Advisors and their diversified portfolios consisting of stocks, bonds, mutual funds, ETFs and MFAs only promise to do their best. If the market is unkind, or the timing is wrong and they fail, only the client loses.

Life and long-term care insurance guarantees there will be enough money to meet a client’s financial needs regardless of when they arise. Investments and managed accounts promise to do their best…given enough time. If needed too soon, only the client loses.