Episode 016: Do You Need Contractual Income Now or Income Later?
The Annuity Man
When annuities were first introduced in the Roman Times as lifetime pension payments for the dutiful Roman soldiers and their families, I doubt if there was much discussion about the start date of that income stream. I'm assuming that there was just pure appreciation for the income gesture. Of course, American's want to have their cake and eat it too.
Today's annuities can be customized so that you can have the income start on a specific day a month from now or years in the future. Just like you have a choice to start your Social Security payments (which is an annuity structure), you can do the same pinpointing with the income annuity type you choose.
Income Now quotes primarily involve Single Premium Immediate Annuities (SPIAs) and Deferred Income Annuities (DIAs). DIAs, Qualified Longevity Annuity Contracts (QLACs), and Income Riders attached to some deferred annuities would be used if quoting for Income Later start date guarantees.
All annuity quotes are like a gallon of milk and expire every 7 to 10 days unless locked in during the application process. For both Income Now and Income Later guarantees, your life expectancy at the time payments start is the primary pricing mechanism. Interest rates play a secondary role.
In this episode, The Annuity Man discusses:
- How annuities started in the Roman Times
- Annuities are the only product that guarantees lifetime income
- How Social Security & Pensions are annuity structures
- The differences between Income Now & Income Later
- Annuity should be associated with lifetime income
- Payments are based primarily upon your life expectancy at the time you take the payment
- Interest Rates play a secondary role in lifetime income pricing
- Annuity income is a combination of return of principal plus interest
Fun with Annuities Podcast is hosted by America’s Annuity Agent, Stan Haithcock, The Annuity Man. Hear brutal annuity facts with no sales pitches from the top independent agent in the country, licensed in all 50 states. Author of 7 books, Stan dives deep on all annuity types and strategies. It’s fun, learning the contractual truths on how annuities actually work and if they’ll fit your personal retirement lifestyle. Listen in on how you can be livin’ the reality, not the dream.
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