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Old 01-07-2018, 03:26 PM
 
Location: Atlanta
110 posts, read 50,492 times
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Has anyone had, have or familiar with a term annuity. A 10 year or so.
I hear of some starting at some point in the future as well as now and paying x amount for a number of years. Any experiences?
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Old 01-07-2018, 03:58 PM
 
Location: Florida
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No but I could see a use for them if you retired at 65 and did not want to start SS until 70. You could buy a term annuity to fill in the gap.
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Old 01-08-2018, 03:12 AM
 
71,991 posts, read 72,020,102 times
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a term annuity is really just a cd from an insurer . they have nothing in common with real annuity products which boost your cash flow with mortality credits.
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Old 01-08-2018, 05:34 AM
 
Location: Central Massachusetts
4,800 posts, read 4,862,845 times
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Quote:
Originally Posted by Zack59 View Post
Has anyone had, have or familiar with a term annuity. A 10 year or so.
I hear of some starting at some point in the future as well as now and paying x amount for a number of years. Any experiences?
Yes I have heard of them. I suggest you do not use it unless you cannot trust yourself. Find a steady investment mutual fund that has averaged around 4% over the last 10 years . Put enough money in it that will give you a monthly income that will allow it to go to the end date of your time period.


We are doing that with the wife's 401k. She has 75k that she saved over the last 10 years. We put it in a target date 2020 mutual fund. It has been averaging 4% over the last 10 years. So in 2 years she will begin to pull money from that fund monthly at about 1500 to 1800 a month until she reaches FRA. We expect it to hold for 4 to 5 years at that monthly income.
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Old 01-08-2018, 06:50 AM
 
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we bridged our retiring at 62 until social security (65) with an income oriented portfolio . yeah , it is variable but it has always done okay over a number of years .

last year it spun off a total return of almost 7% with 70% less volatility than the s&o 500 . it is 75% assorted bond funds and about 25% dividend equity fund
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Old 01-08-2018, 08:05 AM
 
Location: Loudon, TN
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My employee pension offered one paid for by a reduction in your permanent monthly pension payment. It's just a bridge to get you to SS age.
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Old 01-08-2018, 08:15 AM
 
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they really are nothing special , they are no better or worse than cd's. insurers tend to pay a little more .

some like the MYGA also have certain qualities that lend themselves better to retirement than cd's do but they are not annuities as you would think of annuities .
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Old 01-08-2018, 08:35 AM
 
2,605 posts, read 5,311,402 times
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Quote:
Originally Posted by Zack59 View Post
Has anyone had, have or familiar with a term annuity. A 10 year or so.
I hear of some starting at some point in the future as well as now and paying x amount for a number of years. Any experiences?
Possibly convenient as a way of having payouts/ withdrawals managed for you with a modest return.

> Find a steady investment mutual fund that has averaged around 4%

You would get a term annuity if you don't want to count on an average or approximately average return. Worst case a mutual fund could drop 25-50%.
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Old 01-08-2018, 08:52 AM
 
Location: Citrus countyFL
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To say an annuity is the same as a CD is disingenuous and just plain wrong. Annuities offer much better tax benefits than a CD, usually a significantly better yield, are much more liquid, and can guarantee income for life whereas a CD cannot.

To OP: If you are considering an annuity, just be sure you fully understand it. Take your time to read everything about it. Annuities are not for everyone, but they definitely have a use.
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Old 01-08-2018, 08:55 AM
 
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there are differences between the two and both have advantages and disadvantages . just google mygas vs cd's for the pros and cons .

these short term annuities are what amounts to cd's from insurers . they have both plus's and minus's but these term annuities are not in any way like conventional annuity products
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