Ned
New Member
Imagine this to get a prospective clients attention! Or just something new to rework your book of business.
By funding an annuity with a single one-time gift of around $1,500 at birth; you could create a benefit greater than the projected social security benefit 65 years into the future ($4,300 per month). Compare that to the over $135,000 in Social Security taxes paid during a 40-year career by a person earning $50,000 annually. Through the power of long-term tax deferred growth, an annuity could provide a greater benefit than Social Security… but for only 1/100th of the cost.
Social Security is an involuntary 'pay as you go' system that collects money from today's workers and employers to fund the benefits of the current beneficiaries. Social Security benefits always have the possibility of being reduced or even eliminated, as well as being subjected to income offsets. You have no guarantee that today's level of benefit will even be in place in the future.
By comparison, an annuity is NOT a government program and it is independent from Social Security. The benefits of an annuity can never be taken away from the child. By putting the annuity in a trust puts your loved one in control of their financial future, not government officials. The assets in your child's annuity are protected from political turbulence. With this strategy, children will not be solely dependent on a governmental promise of benefits that may be changed or eliminated.
Alarming Facts:
"By 2037, when workers [now] in their mid-20s begin to retire, the system will be bankrupt" (OMB – 2010 estimate)
If Social Security were to fail in 2037 as the Office of Management and Budget predict, your loved ones will be faced with an even a more difficult task of meeting their future needs. Use these facts to encourage the use of annuities as a savings tool for children and a simplified estate planning tool.
Assumes indexed increase of social security benefits of 2 1/2% per year
$1500.00 at birth. Assume 10.19% compounded till age 65 = $820,450.15
This can be used as a great ice breaker for clients with kids or grandkids and open the door to talk about other assets.
By funding an annuity with a single one-time gift of around $1,500 at birth; you could create a benefit greater than the projected social security benefit 65 years into the future ($4,300 per month). Compare that to the over $135,000 in Social Security taxes paid during a 40-year career by a person earning $50,000 annually. Through the power of long-term tax deferred growth, an annuity could provide a greater benefit than Social Security… but for only 1/100th of the cost.
Social Security is an involuntary 'pay as you go' system that collects money from today's workers and employers to fund the benefits of the current beneficiaries. Social Security benefits always have the possibility of being reduced or even eliminated, as well as being subjected to income offsets. You have no guarantee that today's level of benefit will even be in place in the future.
By comparison, an annuity is NOT a government program and it is independent from Social Security. The benefits of an annuity can never be taken away from the child. By putting the annuity in a trust puts your loved one in control of their financial future, not government officials. The assets in your child's annuity are protected from political turbulence. With this strategy, children will not be solely dependent on a governmental promise of benefits that may be changed or eliminated.
Alarming Facts:
"By 2037, when workers [now] in their mid-20s begin to retire, the system will be bankrupt" (OMB – 2010 estimate)
If Social Security were to fail in 2037 as the Office of Management and Budget predict, your loved ones will be faced with an even a more difficult task of meeting their future needs. Use these facts to encourage the use of annuities as a savings tool for children and a simplified estate planning tool.
Assumes indexed increase of social security benefits of 2 1/2% per year
$1500.00 at birth. Assume 10.19% compounded till age 65 = $820,450.15
This can be used as a great ice breaker for clients with kids or grandkids and open the door to talk about other assets.
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