Monthly Pay Out? 45 Yr/old Want $10,000 Annuity that Pays for Life at 70

[entrep1776]

Monthly Pay Out? 45 Yr/old male Want $10,000 Annuity that Pays for Life at 70

Monthly payout for 45 yr/old male that wants to make one time payment of $10,000 annuity that pays for rest of my life & starts at age 70?

I'm working on my license. So, I'd like to sell to myself.

Any risk insurance company goes out of business?
Or Inflation risk?

Any other advice appreciated.

 

[scagnt83]

I would focus on accumulation at this point in your life. Especially considering the current rate environment.

You are locking in interest rates at a historically low point in history, for the rest of your life with this product. You want to lock-in rates when they are high or at least at average levels. Especially considering how long you have until retirement.

If you have substantial assets other than this $10k, and just want to have an annuity to try it or to diversify. Then it might make sense. Or if you just have an incredibly low risk tolerance.

But if this is a large portion of your savings, then imo, it would most likely not be a suitable product for someone in your situation. You need more liquidity at your age.

Also, a $10k premium is going to limit your choices a good bit and will likely knock out some of the top options. But there are a handful that will go that low. Carriers to look at for an amount that low would be American Equity, Great American, and maybe National Western. If its IRA funds then you will have a few more options vs. non-qualified funds.

jmo

----------

If the carrier goes out of business then there is a set process and protections for policyholders. You can read about the process here: http://www.nolhga.com/policyholderinfo/main.cfm

 

[IamChange]

Chances are an annuity that small isn't going to make a difference in your life nor is it very confidence inspiring to show potential clients your $10k annuity while you're trying to convince them it's smart to put $100k or $250k in one.

If you're set on buying something from/for yourself you could take a peek at what an IUL with a lifetime income benefit rider and living benefits can do for you. Your best bet would be a policy you can afford to fund up close to the MEC. Traditional whole life is also a reasonable option.

If you can't get that IUL to illustrate well with the amounts you want to spend just go with a 20 year term with a nice long conversion period that will allow you to switch into a permanent product later. If you're a full time new agent your cash flow is going to be stressed in the coming months and years so you might wish you had most of that $10k back in a few months. A life policy you can ease into might be the smarter bet from a cash flow perspective.

 

[ktmorgan]

Re: Monthly Pay Out? 45 Yr/old male Want $10,000 Annuity that Pays for Life at 70

As SC said, IMO too, much too young to lock in rates with an annuity. If you really break down most Annuities you'll find that the IRR is likely to be no more that 3%. Remember there is a significant portion of an Annuity that is merely the return of premium. 45, IMO is much too young for that.

Inflation risk is too high given the time horizon of the insured. He's likely to live much longer than he expects. Be smart and buy some low cost ETF's or something like that. And spread the assets around 1) Large Cap, 2) Small Cap, 3) Value ETF, 4) Dividend Growth 4) International Ex-US, 5) Total World.

And keep buying more on dips of 20% or more. Then when he's 70 he can roll that into Annuities, Apartment Buildings, Self-Storage or Manufactured Home Communities or something that will maintain his income for life

And fees will kill your returns over the long term when you turn you money over to someone else. Be cost conscious.

Speaking of Real Estate I'm a huge believer in it for my younger clients and for my personal portfolio too. Many many people have become very wealthy buying RE. Make sure it Cash Flows then you don't care if market goes up or down. When it Cash Flows you're not worried about timing the RE market. If you don't panic, over time Inflation will always drive the price of the Asset back up

And with all the Fractional Ownership (Sites, Companies, Start-ups) it's very easy for the little guy to get in the big game with a small ante and get 7-12% returns on short duration notes or deals. Then you get the Cap Gains kicker when they blow out of the deal too. Think about it.

If he's Accredited he can get more like 12-18% returns with short duration, less than 12-18 months. If that's the case and you want to know more you can PM me.

Monthly payout for 45 yr/old male that wants to make one time payment of $10,000 annuity that pays for rest of my life & starts at age 70?

I'm working on my license. So, I'd like to sell to myself.

Any risk insurance company goes out of business?
Or Inflation risk?

Any other advice appreciated.