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John3232, SPIA s are like CDs or long bonds. Rates change frequently. What is great today may not be available tomorrow. Three companies today may be different later. Essentially, you are buying a long bond.
Due Diligence.
Right now I have one million in *cash. I plan to put 485 grand into a joint account in two local credit unions at 2.4% for 3-year.
NCUA insured - 250 grand per SS# on account
*sold house in San Francisco for 1.7 million this year. Should clear 1.1 million after taxes.
If I need to go through a Licensed Rep. for information regarding a SPIA o.k.
However, if I have a few companies already recommended I can check them against companies/policies a Licensed Rep advises.
I have an in-law who was recommend but when I asked for information he jumped into selling mode.
Then when he realized I wasn't planning to buy this year... well that was the end of our email exchange.
If you are not ready to invest now then researching companies is a waste of time as company's rates are always changing and the difference can be significant.
Right now I have one million in *cash. I plan to put 485 grand into a joint account in two local credit unions at 2.4% for 3-year.
NCUA insured - 250 grand per SS# on account
*sold house in San Francisco for 1.7 million this year. Should clear 1.1 million after taxes.
IN AZ you can get a 3 yr MYGA @ 2.7% and defer the tax liability on the interest. A- rated company and in AZ 250k state guaranty association coverage per ss#.
Something also to consider, since annuities are insured by the state they are purchased in, is what the maximum amount your state insures if the company goes belly up. There is no FDIC insurance on annuities but there is a state fund that is supposed to self-insure. Each state is different from memory when I last looked it up.
We just moved from Florida to NCarolina so have to restart my research. Have never spoken to a sales agent and hope to avoid it by using either immediateannuities.com or Fidelity.
Was advised by a smart rich person that annuities should never exceed 1/3 of total assets and to hold off buying them until age 70. YMMV.
reply to post about not bother researching now, wait until you're buying:
Generally I agree but 3 years ago I printed out what our immediate joint annuity payments would be then, and recently looked up what current payments are if purchased today.Todays annuity payments "should" have been higher due to our older age but they are almost exactly the same as 3 years ago.Which means we lost 3 years of annuity payments by waiting since our payout is the same now. 20/20 hindsight ha.
If you are not ready to invest now then researching companies is a waste of time as company's rates are always changing and the difference can be significant.
What I was hoping for were the names of a few recommended annuity companies. I wasn't planning to buy this year.
Perhaps I didn't explain myself correct but almost immediately I was told he was putting together a presentation.
Presentation? I just wanted a few names. The low-down on annuities. Not a sales pitch.
The man has been in the business for 30 years. He's the father of my brother's wife. My mother had spoken this man last year and I was told he'd be happy to help.
And he certainly was after learning I had potentially a million buck to invest.
Something also to consider, since annuities are insured by the state they are purchased in, is what the maximum amount your state insures if the company goes belly up. There is no FDIC insurance on annuities but there is a state fund that is supposed to self-insure. Each state is different from memory when I last looked it up.
We just moved from Florida to NCarolina so have to restart my research. Have never spoken to a sales agent and hope to avoid it by using either immediateannuities.com or Fidelity.
Was advised by a smart rich person that annuities should never exceed 1/3 of total assets and to hold off buying them until age 70. YMMV.
reply to post about not bother researching now, wait until you're buying:
Generally I agree but 3 years ago I printed out what our immediate joint annuity payments would be then, and recently looked up what current payments are if purchased today.Todays annuity payments "should" have been higher due to our older age but they are almost exactly the same as 3 years ago.Which means we lost 3 years of annuity payments by waiting since our payout is the same now. 20/20 hindsight ha.
Location: Was Midvalley Oregon; Now Eastside Seattle area
13,075 posts, read 7,515,583 times
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Quote:
Originally Posted by john3232
What I was hoping for were the names of a few recommended annuity companies. I wasn't planning to buy this year.
Perhaps I didn't explain myself correct but almost immediately I was told he was putting together a presentation.
Presentation? I just wanted a few names. The low-down on annuities. Not a sales pitch.
The man has been in the business for 30 years. He's the father of my brother's wife. My mother had spoken this man last year and I was told he'd be happy to help.
And he certainly was after learning I had potentially a million buck to invest.
The Names are immaterial because their rates change so often and is the acceptance of longevity risk by the annuity company. The best you can do is get an "ballpark" idea what is your return on that SPIA vs whatever alternatives are out there.
Disclaimer: Approx 20% of our current income is from deferred GLWB annuities and may increase to 30% should we take the options of taking withdrawals on remaining annuities. We are NOT annuitizing. Approx 30%-35% is SS and small pension (no COLA), ~40-45%% is rental income. And somewhere in the mix will be another 0-15% from trading accounts. Sums do not add up to 100% because I try to optimize Income from all Income sources and against each Income source, all the time.
I periodically go thru this exercise with ImmediateAnnuities.com (Hersh Stern, principle) and local representatives. Hersh Stern has a pretty good quarterly pamphlet that gives approximate rates of all the different types of annuities. I used to have a pile of his pamphlets but we had downsized to another state and a smaller home.
Shop till you drop. Any decision may be a decision for "life". As the Knight Templar said to Indiana Jones, "Chose Wisely"
Good Luck
Using that calculator, the payout amount at age 65, assuming no increases, beneficiaries or any other benefits and starting in mid 2020 is about 6.2%.
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