Best annuity payout 5 years

[LostDollar]

NA won't even be in the top 10 on a 1 year deferral for a 70yo.

They would probably be top 5 (or close to) on no deferral.

Ok.

I took this post

But what's the age and what's the lifetime income distribution percentage?

5% on 140,400 (after 1 year using your example) is 7,020 for life.

If that same client had a 20% upfront income bonus with a 7% rollup but was at 6% for life for the same client (128,400), that would be 7,704 for life, or 10% more income.

Corebridge (their MSG distribution line), F&G, National Western, Global Atlantic, and Allianz are all players in the one-year deferral market.

On no deferral, you'd have to add in North American, Symetra, and Pru.

On longer deferrals, Athene, American Equity, and others.

There are a ton of moving parts in this space and the players are constantly changing.

to mean that 7,000 to 7,700 were actual income ranges one might expect to see on the 100K contract. Did I misinterpret that?

 

[Tahoe Ray]

Ok.

I took this post


to mean that 7,000 to 7,700 were actual income ranges one might expect to see on the 100K contract. Did I misinterpret that?

I wasn't speaking to a specific carrier. Just giving an example of how the distribution percentage plays as large (if not larger) a role in maximum income than the income base does at withdrawal time.

In reality, a 70yo on a 1 year deferral would have a much higher income for 100k (more like 9-10k).

 

[LostDollar]

I wasn't speaking to a specific carrier. Just giving an example of how the distribution percentage plays as large (if not larger) a role in maximum income than the income base does at withdrawal time.

In reality, a 70yo on a 1 year deferral would have a much higher income for 100k (more like 9-10k).

Thank you for taking the time to give me a reply.

That shows me what you are talking about, why you and mtc said what you said.

 

[LostDollar]

Maybe you can find an agent that's licensed in Kansas to help you.

Thank you for your interest and concern.

Working on it, but even there, there are challenges.

I am not entirely sure of this comparison, but, considering my age and the purchases I have asked for, I think what I have been asking from annuity agents would be roughly analogous to expecting a Medigap agent to sell three GI Medigap plans simultaneously.

(forget about, you can't own 3 medigap plans and just think about what I have seen expressed on the site about compensation and efforts, efforts up to the carrier and down to the client. Just like with successful Medigap sellers, a "going concern" annuity salesperson can find better return, less effort clients than what I am presenting to be.)

 

[PrivClientSG]

They're not that competitive on the guaranteed side anymore which I'm guessing is what MTC is referencing.

Some of these carriers use stacking, credit par leverage, and a whole lot of other "hopes and dreams" to show larger incomes.

When we design the annuity side of a distribution plan, we only rely on the guarantees. Everything else (any increased income, account value stability, etc.) is just icing if it happens.

But what's the age and what's the lifetime income distribution percentage?

5% on 140,400 (after 1 year using your example) is 7,020 for life.

If that same client had a 20% upfront income bonus with a 7% rollup but was at 6% for life for the same client (128,400), that would be 7,704 for life, or 10% more income.

Corebridge (their MSG distribution line), F&G, National Western, Global Atlantic, and Allianz are all players in the one-year deferral market.

On no deferral, you'd have to add in North American, Symetra, and Pru.

On longer deferrals, Athene, American Equity, and others.

There are a ton of moving parts in this space and the players are constantly changing.

Thanks for the detailed info TR...so I went and looked at the white paper I saw...it was part of a major presentation that a wealth management firm was doing for an estate planning council in FL.

Anyway, here's what it showed (I took all of this from the white paper itself, the spreadsheet analysis, footnotes, etc.):

Product:
Nationwide New Heights/Select 9 (Fixed Indexed Annuity) -- with
the Nationwide High Point 365 Select Lifetime Income rider with Bonus.

Client: Male, Age 70 (Single life)
Initial purchase: $1,000,000
Bonus: 30%
Deferral: One year
Annual increase: 8%
Income: $83,959
Percentage payout based upon initial purchase: 8.4%
Percentage payout based upon total income value: 5.98%

Now, like I said, this is not my marketplace, area of expertise, etc. -- but from what they were presenting (that this was just one asset in the client's financial world), looking at SS, other IRA assets, etc. -- this did not look too bad to me. Am I missing something?

Deferring one year (aside from the bonus) gets you 8% on that income value (which includes the big bonus) -- and you land on $84,000 of guaranteed income? Not too bad, no? The client has other assets, life insurance, etc., it almost sounds like a mini-version of the old "pension max" play (but the client already has the life insurance in place -- which was part of the original financial statement shown).

So, are there better products/better payouts? I saw a few others that might/could be in other parts of the presentation, but in this part, it sounded like this was one of the front-runners. Now, if you say there are better -- I would absolutely accept that. How much better can the number be though? I ran some hypotheticals on NumberCruncher, and these two numbers looked pretty good.

Thanks again for your insight and expertise!

 

[MTC]

Thanks for the detailed info TR...so I went and looked at the white paper I saw...it was part of a major presentation that a wealth management firm was doing for an estate planning council in FL.

Anyway, here's what it showed (I took all of this from the white paper itself, the spreadsheet analysis, footnotes, etc.):

Product:
Nationwide New Heights/Select 9 (Fixed Indexed Annuity) -- with
the Nationwide High Point 365 Select Lifetime Income rider with Bonus.

Client: Male, Age 70 (Single life)
Initial purchase: $1,000,000
Bonus: 30%
Deferral: One year
Annual increase: 8%
Income: $83,959
Percentage payout based upon initial purchase: 8.4%
Percentage payout based upon total income value: 5.98%

Now, like I said, this is not my marketplace, area of expertise, etc. -- but from what they were presenting (that this was just one asset in the client's financial world), looking at SS, other IRA assets, etc. -- this did not look too bad to me. Am I missing something?

Deferring one year (aside from the bonus) gets you 8% on that income value (which includes the big bonus) -- and you land on $84,000 of guaranteed income? Not too bad, no? The client has other assets, life insurance, etc., it almost sounds like a mini-version of the old "pension max" play (but the client already has the life insurance in place -- which was part of the original financial statement shown).

So, are there better products/better payouts? I saw a few others that might/could be in other parts of the presentation, but in this part, it sounded like this was one of the front-runners. Now, if you say there are better -- I would absolutely accept that. How much better can the number be though? I ran some hypotheticals on NumberCruncher, and these two numbers looked pretty good.

Thanks again for your insight and expertise!

Just trying to help. That 83K isn't in the top 15 of guaranteed income. I'm no genius. I just use a database and plug in numbers. I used Colorado because I didn't see a state.

 

[Tahoe Ray]

Thanks for the detailed info TR...so I went and looked at the white paper I saw...it was part of a major presentation that a wealth management firm was doing for an estate planning council in FL.

Anyway, here's what it showed (I took all of this from the white paper itself, the spreadsheet analysis, footnotes, etc.):

Product:
Nationwide New Heights/Select 9 (Fixed Indexed Annuity) -- with
the Nationwide High Point 365 Select Lifetime Income rider with Bonus.

Client: Male, Age 70 (Single life)
Initial purchase: $1,000,000
Bonus: 30%
Deferral: One year
Annual increase: 8%
Income: $83,959
Percentage payout based upon initial purchase: 8.4%
Percentage payout based upon total income value: 5.98%

Now, like I said, this is not my marketplace, area of expertise, etc. -- but from what they were presenting (that this was just one asset in the client's financial world), looking at SS, other IRA assets, etc. -- this did not look too bad to me. Am I missing something?

Deferring one year (aside from the bonus) gets you 8% on that income value (which includes the big bonus) -- and you land on $84,000 of guaranteed income? Not too bad, no? The client has other assets, life insurance, etc., it almost sounds like a mini-version of the old "pension max" play (but the client already has the life insurance in place -- which was part of the original financial statement shown).

So, are there better products/better payouts? I saw a few others that might/could be in other parts of the presentation, but in this part, it sounded like this was one of the front-runners. Now, if you say there are better -- I would absolutely accept that. How much better can the number be though? I ran some hypotheticals on NumberCruncher, and these two numbers looked pretty good.

Thanks again for your insight and expertise!

Like MTC said, it's not competitive.

The strategy is VERY sound and one that we employ daily. Most of these products have similar factors that affect the income payout, however, that example has many carriers (Corebridge, National Western, F&G, Ameritas, Midland, Allianz and others that are below A rated so we don't normally quote them) over 90k/yr (10%+ more income in several cases) with the same design.

So, the idea is great and very attractive in conjunction with other planning/distribution concepts. It's just that Nationwide isn't competitive for that design.

 

[scagnt83]

Competitive is a relative term.

Is Nationwide competitive vs. using CDs/AAAs/MYGAs to accumulate, then a SPIA to distribute?? Yes, it is competitive in that scenario.

Is Nationwide competitive in that scenario as a Fixed Indexed Annuity with Income Rider? No.

The concept is competitive, regardless of the product.

But product competitiveness changes based on the age/deferral/payout option. And the entire landscape changes year to year, the best option for a 60 year old who needs 10 years of deferral and joint income... can easily be different 6 months from now or a year from now.

I realize this is risking commoditizing the product to an extent. But if income is the main goal, then it really does come down to ratings/payout as the main deciding factors.

 

[Tahoe Ray]

I realize this is risking commoditizing the product to an extent. But if income is the main goal, then it really does come down to ratings/payout as the main deciding factors.

It's commoditized to an extent already, which is great for the consumer/agent.

 

[PrivClientSG]

Like MTC said, it's not competitive.

The strategy is VERY sound and one that we employ daily. Most of these products have similar factors that affect the income payout, however, that example has many carriers (Corebridge, National Western, F&G, Ameritas, Midland, Allianz and others that are below A rated so we don't normally quote them) over 90k/yr (10%+ more income in several cases) with the same design.

So, the idea is great and very attractive in conjunction with other planning/distribution concepts. It's just that Nationwide isn't competitive for that design.

Thanks again TR. I went back and looked at the presentation (the summary was 80 pages! LOL), and I didn't look at the complete version in detail at all. However, when I glanced at all the tables/schedules I see they (carriers/products) were categorized in a variety of ways -- ratings (and other financial parameters), product features and riders, etc. It's a lot of material! LOL. I can see ratings and financials being a substantial factor of course. It makes perfect sense, and is prudent to not show carriers below A-rated.

Like I said, the client/case studies were very interesting, and like you said, the various strategies they portrayed are VERY sound and attractive. For a client of that age, type, net worth, etc. -- these various strategies can be very powerful and beneficial. One of the scenarios showed bifurcating both qualified and non-qualified assets into two or more components -- and using distributions from (one component of) qualified assets, and distributions from (one component of) non-qualified -- to increase income and lower the effective tax rate one would pay on that income. While I am sure we've all seen this countless times before and it's certainly nothing new, I like the distribution planning and tax orientation of it. Strategy, not product. The software the presenter used was a combination of spreadsheets and something that looked like a version of the tax and distribution components of and eMoney platform.

Anyway, thanks again for the insight, and thanks to all who contributed.