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Old 01-08-2018, 09:49 AM
 
Location: Atlanta
110 posts, read 50,303 times
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Are term annuities asset protected in states that protect annuities?
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Old 01-08-2018, 10:07 AM
 
Location: Prescott AZ
6,125 posts, read 9,086,149 times
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My ten year annuity gives me $900 a month income. Don't know any CD that will do that.
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Old 01-08-2018, 11:15 AM
 
71,637 posts, read 71,777,271 times
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really , that is because each payment is principal too . but live and learn i guess , because now you will . .....

i just looked up a 10 year period certain annuity at immediate annuities.com

a 10 year is paying out between 900 and 910 a month and requires 100k today so in 10 years you got 109,200 back in -total if i figure the higher end

.910 x 12 x 120 months -109,200.00

a discover 10 year cd is paying 2.37 on 100k over 10 years. that is 126,394.00 . last i looked 126,394.00 is more than 109,200

https://ratebrain.com/discover-bank-10-year-cd-website

Last edited by mathjak107; 01-08-2018 at 11:34 AM..
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Old 01-08-2018, 12:13 PM
 
Location: Idaho
1,454 posts, read 1,156,015 times
Reputation: 5492
Quote:
Originally Posted by mathjak107 View Post
really , that is because each payment is principal too . but live and learn i guess , because now you will . .....

i just looked up a 10 year period certain annuity at immediate annuities.com

a 10 year is paying out between 900 and 910 a month and requires 100k today so in 10 years you got 109,200 back in -total if i figure the higher end

.910 x 12 x 120 months -109,200.00

a discover 10 year cd is paying 2.37 on 100k over 10 years. that is 126,394.00 . last i looked 126,394.00 is more than 109,200

https://ratebrain.com/discover-bank-10-year-cd-website
I think you overlooked the fact that with a term annuity, you start getting the payment of $900-$910 from day one. With a CD, you will only receive the interests. If one needs certain amount of bridge income, it's a big difference between receiving $910/month vs. $200/month (2.37% interest assuming the interest is paid monthly).

Here is a link to an annuity calculator

http://www.bankrate.com/calculators/...alculator.aspx

I prepared a spreadsheet for annuity calculation a while ago when I was deciding whether to take a lump sum or an immediate annuity from my previous company.

I plugged in the amount of $100,000 with $910 monthly payment for 10 years and got an effective interest rate of 2.0%. So at the first glance, this is lower than a 10-year CD with 2.37%. However, if receiving $910/month helps one to delay collecting SS, getting a term annuity is a better option than a CD.
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Old 01-08-2018, 12:59 PM
 
Location: Atlanta
110 posts, read 50,303 times
Reputation: 65
Quote:
Originally Posted by mathjak107 View Post
really , that is because each payment is principal too . but live and learn i guess , because now you will . .....

i just looked up a 10 year period certain annuity at immediate annuities.com

a 10 year is paying out between 900 and 910 a month and requires 100k today so in 10 years you got 109,200 back in -total if i figure the higher end

.910 x 12 x 120 months -109,200.00

a discover 10 year cd is paying 2.37 on 100k over 10 years. that is 126,394.00 . last i looked 126,394.00 is more than 109,200

https://ratebrain.com/discover-bank-10-year-cd-website
I would think that when the 10 year term annuity was opened CD rates were lower. At todays rates the return may be $950 or higher. Still to low to commit for 10 years.

Wonder what the payout was for 10 year annuities that are running out this year because they were opened in 2007 or 2008.
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Old 01-08-2018, 03:04 PM
Status: "Re-edit status" (set 19 days ago)
 
Location: Was Midvalley Oregon; Now Eastside Seattle area
4,181 posts, read 1,903,923 times
Reputation: 3206
Commonly known as MYGA (Multi Year Guaranteed Annuity).
Briefly looked at them.
IMO, best when used in falling interest rates. Not good in rising interest rates. Annuities have relatively low flexibility so any annuity must be purchased with extreme care and forethought.
Ok for use for deferred, nonIRA money, shortterm 5-7 years, a bridging vehicle. Niche is fairly limited.

Yes, we have annuities, GLWB VAs and FI. The getting was reasonably good then. Not as good if purchased today. Depends on your risk levels and time frames.
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Old 01-08-2018, 03:22 PM
 
71,637 posts, read 71,777,271 times
Reputation: 49230
Quote:
Originally Posted by Zack59 View Post
I would think that when the 10 year term annuity was opened CD rates were lower. At todays rates the return may be $950 or higher. Still to low to commit for 10 years.

Wonder what the payout was for 10 year annuities that are running out this year because they were opened in 2007 or 2008.
well all i can tell you is these are the prices today so they are what they are
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Old 01-08-2018, 03:25 PM
 
71,637 posts, read 71,777,271 times
Reputation: 49230
Quote:
Originally Posted by BellaDL View Post
I think you overlooked the fact that with a term annuity, you start getting the payment of $900-$910 from day one. With a CD, you will only receive the interests. If one needs certain amount of bridge income, it's a big difference between receiving $910/month vs. $200/month (2.37% interest assuming the interest is paid monthly).

Here is a link to an annuity calculator

http://www.bankrate.com/calculators/...alculator.aspx

I prepared a spreadsheet for annuity calculation a while ago when I was deciding whether to take a lump sum or an immediate annuity from my previous company.

I plugged in the amount of $100,000 with $910 monthly payment for 10 years and got an effective interest rate of 2.0%. So at the first glance, this is lower than a 10-year CD with 2.37%. However, if receiving $910/month helps one to delay collecting SS, getting a term annuity is a better option than a CD.
i didn't over look a thing . that final number is your whole 10 year deal-period dollar wise .

how the money gets distributed is a different story . that is why there are these short term annuities and cd's . i did not recommend either one .

the payouts are different and one may be more accommodating than another depending on individual situation .

it is not until you get in to life time annuities with mortality credits that they are no longer similar products . .

personally we don't use or have a use for either and we delayed ss and needed to draw income while delaying to make up for it .

. i use a income model with 75% assorted bond funds and 25% dividend equity fund and it produces all the money we needed to hold us over until ss . last year this conservative mix returned 6.70% .

we keep the current spending year in cd's and ladder them to get through the year so they come due every few months . we live off them .

although this year we are using a very conservative bond fund instead of the cd's .

of course this is only for generating income . our longer term money is in a more aggressive portfolio .

Last edited by mathjak107; 01-08-2018 at 04:06 PM..
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