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Old 04-16-2016, 05:17 AM
 
Location: Mount Airy, Maryland
10,465 posts, read 5,935,374 times
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Quote:
Originally Posted by mathjak107 View Post
you can buy a joint annuity with only about a 1/2 % difference . but what you may want to look in to is a single annuity with the higher payment with a separate permanent life policy .

rather then your spouse get taxable annuity income , the insurance money is tax free .

you may be able to get a life policy that is cheaper then what you give up on the joint annuity .

if the spouse needs more income she can always take some of the money and buy an annuity .

i have not looked in to the price difference .
I have to believe a $100,000 permanent life policy for a 70 year old will be very expensive, if it's only 1/2% the joint anuity may be the way to go.
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Old 04-16-2016, 05:37 AM
 
Location: NC Piedmont
3,911 posts, read 2,881,013 times
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Quote:
Originally Posted by DaveinMtAiry View Post
I have to believe a $100,000 permanent life policy for a 70 year old will be very expensive, if it's only 1/2% the joint anuity may be the way to go.
I am providing a link to a site I used to compare different possibillities only because it is really easy to see the impact of different option selections, not because I think it is the best deal (they front a bunch of companies and I think you get reasonably competitive returns listed) or the best site. Anyway, with that disclaimer, here is the link:
https://www.immediateannuities.com
I always plugged in 100,000 as the investment amount so that looking at different ages, states and marital status was apples to apples. Anyway, fill in 3 to 5 fields (no personal info required) and it will give you the payouts with different options.
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Old 04-16-2016, 07:21 AM
 
71,674 posts, read 71,801,099 times
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Quote:
Originally Posted by DaveinMtAiry View Post
I have to believe a $100,000 permanent life policy for a 70 year old will be very expensive, if it's only 1/2% the joint anuity may be the way to go.
the smart thing to do is add the policy younger , but of course time is always wasted on the ignorant . we never know the advantages down the road to permanent insurance . we are led to believe it is evil .

but it really does not come in to play until after we are older in retirement planning and it is first then we see it shine
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Old 04-16-2016, 07:32 AM
 
71,674 posts, read 71,801,099 times
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as i posted many times , an integrated strategy using permanent insurance , your own investing and an spia has beaten by term and invest the rest in almost 70% of the 10,000 different scenario's run by dr pfau .

yeah , up to 65 , buy term and invest the rest had a bigger balance , but after that all bets were off .

the integrated strategy had a higher safer withdrawal rate 100% of the time and a bigger balance for heirs 67% of the time just figuring average life expectancy .

the tax free insurance made a big difference to the surviving spouses outcome and zero sequence risk on the insurance components made for a larger draw rate . .
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Old 04-18-2016, 02:55 PM
 
30,129 posts, read 47,361,961 times
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Quote:
Originally Posted by mathjak107 View Post
the smart thing to do is add the policy younger , but of course time is always wasted on the ignorant . we never know the advantages down the road to permanent insurance . we are led to believe it is evil .

but it really does not come in to play until after we are older in retirement planning and it is first then we see it shine
https://www.kitces.com/blog/financia...#disqus_thread

This is the new entry on Kitches's blog and it is interesting because 1) it calls into consideration the need for people to have/use the help of someone to give long-range planning help for investing and modeling a successful financial agenda throughout someone's life...
So the life insurance conundrum could be addressed and evaluated as part of an ongoing strategy...

And the article also reveals the consideration given to the marketing aspect of financial consultation--rebranding to achieve better exposure, more clients, higher profits...

The real problem is separating quality advice from quality marketing because a great salesman might be the worst person to give advice about any aspect of investing, short or long term goals, risk assessment...
New fiduciary rules for investment advisors don't guarantee that you are going to get a smart advisor--just one who is not out to manipulate his clients' choices to enrich himself...
not exactly the same thing...
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Old 04-18-2016, 03:51 PM
 
71,674 posts, read 71,801,099 times
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for the more savvy the article points out that while you have different retirement goal priority's they run counter to each other .

what your strategy is if maximum income is desired is different then if you want maximum legacy money .
then there is the issue of safety and risk , that can run counter to the other goals .

with some knowledge and understanding though kitces is saying it is possible to get more then one of those priority's out of the same strategy but you need the knowledge behind it .

so to use the example i used above , the annuity is considered the safest choice , it is poor at legacy money and good in the early years on income but grows worse with inflation .

the 50/50 mix is good on income at a 6.50% withdrawal rate based on averages , decent on legacy money under favorable outcomes but poor in risk of lasting .

however kitces points out that cut spending to 4% and that 50/50 mix now takes on a 95% success rate at 4.00% . that means worst case runs out in 28 years .

but for a 65 year old couple there is only a 7% chance one of them will be alive in 28 years , so that now changes the 50/50 mix to only a 2% failure rate which is quite great .

he talks about all the asset classes and how slight changes in them or their usage give them better multi functions rather then as they are as is .
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Old 04-18-2016, 06:55 PM
 
6,277 posts, read 4,740,348 times
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Quote:
Originally Posted by mathjak107 View Post
.......
the tax free insurance made a big difference to the surviving spouses outcome ......... . .
This year at my annual financial review, I plan on taking a look at insurance. The idea will be to provide a chunk of money to the surviving spouse which is tax free. I am not sure if it is a strategy that will work or will provide enough benefit to consider. I have never spent the time looking at taxes but with RMDs looming that will be a consideration.
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Old 04-18-2016, 07:52 PM
 
30,129 posts, read 47,361,961 times
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What would be premium for 66 yr old man or woman in good but not excellent health for a 250K life insurance policy....any idea?
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Old 04-18-2016, 08:05 PM
Status: "Re-edit status" (set 20 days ago)
 
Location: Was Midvalley Oregon; Now Eastside Seattle area
4,185 posts, read 1,906,934 times
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I tried to be flexible with Spending Habits, Financial Products, Market factors, Health factors, and probably many smaller factors.

As I was caring for my mother and my in-law's, I recognized that having enough "funds to last" was more important than dying broke. Thus the selection of Financial Products was determinate on their flexibility and risk management. As for spending habits, there wasn't much fat to cut.

YMMV
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Old 04-18-2016, 08:14 PM
Status: "Re-edit status" (set 20 days ago)
 
Location: Was Midvalley Oregon; Now Eastside Seattle area
4,185 posts, read 1,906,934 times
Reputation: 3211
Quote:
Originally Posted by mathjak107 View Post

...snip...but for a 65 year old couple there is only a 7% chance one of them will be alive in 28 years , so that now changes the 50/50 mix to only a 2% failure rate which is quite great .
In the early years of retirement, one is careful with money.
In the later stages of life, one is Really careful with money.
I hopefully have in place, where we don't have to be real careful, but knowingly careful. We'll see in N years.
officially turned another year. 66/68.
YyearMMV
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