Episode 017: Explaining Annuitization Structuring Choices

The Annuity Man

When the Roman Empire created "annuas" (aka: "payments") for their dutiful soldiers and their families, they unknowingly established "annuitization."  Annuitization is the contractual creation of a lifetime income stream or a income stream for a specific period of time.  It's an irrevocable contractual guarantee and a pure transfer of risk strategy.

There are primarily 3 annuity product types that utilize "annutization" to create a guaranteed income stream.  Those strategies are Single Premium Immediate Annuities (SPIAs), Deferred Income Annuities (DIAs), and Qualified Longevity Annuity Contracts (QLACs).  In addition to those specific annuitization type products, deferred annuities like Multi-Year Guarantee Annuities (MYGAs), Variable Annuities (VAs), and Fixed Index Annuities (FIAs) can be "annuitized" and turned into an income stream.

Lifetime annuitization payment guarantees are primarily priced on your life expectancy at the time you start the payments.  Those payments are a combination of return of principal plus interest, with the annuity company being on the hook to pay regardless of how long you live.  You can own annuitized products or annuitize deferred annuities in all account types.  Traditional IRAs, Roth IRAs, and non-IRAs (i.e. non-qualified) can all hold annuity types.  The only difference is how the income is taxed coming out of those accounts.

In this episode, The Annuity Man discusses:

  • What annuitization means and how it works
  • The different structuring choices and how they work
  • How you can customize the quotes for your situation
  • How lifetime income guarantees are priced

Key Takeaways:

  • There are over 30 ways to structure annuity payments
  • Annuities are the only product type that guarantees a lifetime income stream
  • Annuities can be held in IRAs, Roth IRAs, non-IRAs (non-qualified accounts)
  • Always shop all carriers to find the highest contractual guarantee

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.

Listen on Stitcher, Apple Podcasts, and Spotify. Get the best and highest confinement care and enhanced benefit quotes using Stan's proprietary annuity calculators. You can also receive all 6 of The Annuity Man Owner's Manuals for free and under no obligation and see a live feed of the best fixed rates for your specific state of residence.

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