Have the money you need for retirement with lifetime income annuity

When you are looking for an additional lifetime income stream to add to your current Social Security and pension payments, a lifetime income annuity can provide the contractual guarantees to cover your bills, allow you to properly budget, and help provide a worry-free retirement.


Do

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  • determine how much additional monthly income you want
  • choose from an IRA or non-IRA account
  • quote as many insurance carriers as possible
  • choose an insurance carrier with a high rating
  • direct deposit
Don't

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  • put all of your money in one place
  • exceed the State Guarantee Fund limits
  • choose the “Life Only” option
  • use a captive agent
  • buy a variable annuity or an indexed annuity

[publishpress_authors_data]'s recommendation to ExpertBeacon readers: Do

Do determine how much additional monthly income you want

Lifetime Income Annuities are contractual guarantees, so you can choose a specific dollar amount that you need to cover on a monthly basis, and know exactly how much initial premium it would take to create that lifetime income stream.

Do choose from an IRA or non-IRA account

Lifetime Income Annuities work in both IRA and non-IRA accounts, and will provide an income stream that you cannot outlive. However, in non-IRA accounts, there are additional tax benefits from your income.

Do quote as many insurance carriers as possible

Lifetime Income Annuities are a commodity product, in essence, because carriers will bid on your business. Because of this, it is very important to quote as many insurance carriers as possible to get the highest contractually guaranteed payout.

Do choose an insurance carrier with a high rating

Because your lifetime income stream is a contractual agreement between you and the carrier, it is important to choose an insurance company that can back up those guarantees. Ask your agent or advisor to look at the Comdex Ranking (a composite of a company’s ratings that is compiled with other companies, ranking all of them against each other.) Here is a list of the Current Rankings.

Do direct deposit

Have the lifetime income monthly payments wired directly into your bank account. Just provide a copy of a voided check with the application, and your income stream payments will be sent to your bank just like your Social Security payments.


[publishpress_authors_data]'s professional advice to ExpertBeacon readers: Don't

Do not put all of your money in one place

Just like any investment strategy, it is not wise to put all your money into one basket. In this case, the basket is an annuity carrier, and if possible, spread that money among different carriers. The same holds true for lifetime income annuities.

Do not exceed the State Guarantee Fund limits

Annuities are regulated and backed up at the state level. Each state will guarantee a certain dollar amount for each policy. Be sure to have your agent or advisor give you up-to-date information on your state’s limits.

Do not choose the “Life Only” option

Structure your lifetime income annuity as “Life with Cash Refund” or “Life with Installment Refund” to make sure that all of your money goes to you or your listed beneficiaries.

Do not use a captive agent

A captive agent works for only one insurance company is paid some percentage of commission. They want your business and will give you only one option. That’s not okay. You need to look at multiple quotes from multiple carriers to get the highest contractual guarantee possible.

Do not buy a variable annuity or an indexed annuity

An agent may try to convince you to buy one of these annuity structures for immediate lifetime income needs. Lifetime Income Annuities pay the lowest commission for agents, and are simple and efficient for the client. For income needs, this is the best pro-customer structure available.


Summary

Lifetime Income Annuities, also called Single Premium Immediate Annuities, provide an income stream that you can never outlive. You can use that contractually guaranteed payment to help budget and cover your fixed expenses. This is the most efficient transfer of risk strategy available to solve for lifetime income, and should be considered as a foundation to your overall retirement plan.

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