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Old 09-27-2010, 07:45 PM
27,449 posts, read 44,947,050 times
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my husband has 401K at company he left in the 80s--he was vested--
the monthly guaranteed benefit when he "retires" would be 1000 but the last statement we received said that if he withdrew the money to IRA the amount would be 100K--

how much money would it take to generate an annunity for say 30 yrs with a payout of 12K a year...

it seems like a much better deal to take the monthly payout vs the lump sum--but I get no survivor benefit from it when he dies--

we were considering putting it in a Roth IRA since we have not been able to open one prior to this year...
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Old 09-27-2010, 08:16 PM
Location: MMU->ABE->ATL->ASH
9,002 posts, read 16,123,201 times
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Immediate Annuities - Instant Annuity Quote Calculator.

Is a calc that you can run some numbers. 401K dont usualy have guaranteed benefit, the balance float with the stock market, bonds, or set intrest rate for the year. In the 80's alot of companines roll'ed there pention into Insurence contracts that at 65 give you a guaranteed rate, that you would have gotten if you got a penison.
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Old 09-27-2010, 09:50 PM
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Default The rates are not the only thing you need to understand...

The basic meaning of an annuity used to be that you get the income for as long as you are alive. The marketers have given LOTS MORE OPTIONS so that now there are people signing up for "fixed period" annuties.

The tax implications of funding an annuity out of a a self directed IRA are generally worth researching, few people really do this. The curent implications of converting a 401k into a regular IRA OR Roth IRA and low rates / uncertainty have annuity salespeople falling over themsleves...

Annuity rates are based not just on curent interest but the actuarial rates of the purchasers / beneficiary. Since men do not live as long as women the gender is important. Typically a fxed period single payment annuity for a 25 year period would "cost" less for someone younger and more for someone older -- these types of annuities will pay out regardless of wether the purchaser is alive, but only in monthly checks and NOT a single payout the way a traditional life insurance plan would.

If hubby has about $100k an annuity would only get him about $500/ mo assuming he is about 40 years old...
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Old 09-28-2010, 02:41 AM
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an immeadiate annuity at 62 right now pays between 500-600 with 100k
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Old 10-11-2010, 04:46 AM
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Yes, a lot depends on his current age and how long until retirement. An immediate annuity for a 65 year old male with no survivor benefits would cost around $160K to generate $1000 a month. But, they already have your money and will not be paying until he retires. That alters the equation.
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Old 10-11-2010, 03:50 PM
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Shaker had a good point, how long until he retires? It's a big difference having $1000/month now versus 20 years from now, both from a cost of living standpoint and how much you might expect to grow that 100k before he retires.
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