Help Getting Out of Annuity

[treblehook]

I have a fixed lump sum payout annuity that was setup for me after a car accident 15 years ago that I am considering getting out of. The problem is I am having trouble finding out how and what the penalties are. My question is, is it possible to pull this money out before the payment date of 2035 and what is the best way to go about this.

 

[Crabcake Johnny]

Have you called the carrier?

 

[treblehook]

I called the Insurance company but they were not very helpful with information. Partly my fault since I wasn't sure of what questions to ask. All they told me was that they could not handle payouts.

 

[VolAgent]

Ask them flat out if you can receive the money now, what the penalty will be.

 

[Crabcake Johnny]

And if it's not due until 2035, it'll be pennies on the dollar...plus the income tax hit.

 

[Larry Tew]

You will take a severe beating trying to convert a structured settlement to a cash present value now. You could call JG Wentworth (seen on TV ads). They will buy your future annuity income stream for a discounted present value. This assumes you have an actual structured settlement and not just a fixed annuity. After 15 years you shouldn't have any surrender charges on the annuity but would have a 10% IRS penalty on all the untaxed interest you withdraw - assuming you can withdraw now.

 

[arnguy]

Larry, I believe that would depend on the OP's age. If he is 591/2 or older that 10% penalty wouldn't apply.

 

[Larry Tew]

Larry, I believe that would depend on the OP's age. If he is 591/2 or older that 10% penalty wouldn't apply.

Agreed. I assumed since the payout date was 2035 he was probably under 59 1/2. I should have asked his age. Good catch.

 

[Freddie]

I have a fixed lump sum payout annuity that was setup for me after a car accident 15 years ago that I am considering getting out of. The problem is I am having trouble finding out how and what the penalties are. My question is, is it possible to pull this money out before the payment date of 2035 and what is the best way to go about this.

Check out John Bulbrook of Bulbrook/Drislane Brokerage. Google it - should be www.bulbrookdrislane.com. They resell annuities and structured settlements and he is in Wellesley, MA. (off their web site) 800-227-1258 ext 122

Note: I do not know this guy and have not done business with him. I inquired about his resales of annuities where an investors can get 6 to 8%. The problem is the inventory can be small and people have to wait a while on some of the payouts and it is not liquid.

Like I said, I do not know this guy but maybe he can help. He has to better than JG Wentworth. I hope this helps.

 

[budfox7]

You will take a severe beating trying to convert a structured settlement to a cash present value now. You could call JG Wentworth (seen on TV ads). They will buy your future annuity income stream for a discounted present value. This assumes you have an actual structured settlement and not just a fixed annuity. After 15 years you shouldn't have any surrender charges on the annuity but would have a 10% IRS penalty on all the untaxed interest you withdraw - assuming you can withdraw now.

No 10% penalty if you do a SPIA, just 1/2 of the earnings tax. You only pay a 10% if you withdrawl early outside of a SPIA for life option.