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There is a website called immediateannuities.com that claims that the insured goes and selects their own annuity and promises "no agent will call you"? How is this possible? Can the customer go from start to finish without contacting an agent?
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The Income Rider does the exact same thing, but allows you to keep liquid access to your funds for about 12-18 years
Agree with everything you state, except I wouldn't say Income Rider does the "exact same thing", I would say it does nearly the same thing. If I understand correctly, the taxation of a NQ SPIA compared to a NQ income rider will be taxed differently each year. with a NQ SPIA, you are receiving back a portion of your principal in each check and the exclusion ratio excludes that from being reported as taxable throughout the duration of the SPIA checks until you have recovered your original principal. at which time every NQ SPIA check becomes taxable.
I may be wrong, but I don't believe income riders work in that manner & they are taxes like deferred annuities in that they are LIFO( Last In First out), meaning all deferred interest in the contract or previous contracts 1035 exchanged over the years will have to come out fully taxable first before you can get to your Tax Free Cost basis/Principal.
Likely not a big deal to instead choose SPIA over Income rider, but I can think of some situations where minimizing taxable income for a period of time could be beneficial depending on tax bracket. Many agents in our industry misunderstand Principal in carriers contract at time of purchase versus cost basis that could have been started back in the 1980s & 3 or 4 carriers over the years while in deferral.
You can write Lincoln's i4Life and get an exclusion ration without annuitizing...I may be wrong, but I don't believe income riders work in that manner & they are taxes like deferred annuities in that they are LIFO( Last In First out), meaning all deferred interest in the contract or previous contracts 1035 exchanged over the years will have to come out fully taxable first before you can get to your Tax Free Cost basis/Principal.
Likely not a big deal to instead choose SPIA over Income rider, but I can think of some situations where minimizing taxable income for a period of time could be beneficial depending on tax bracket. Many agents in our industry misunderstand Principal in carriers contract at time of purchase versus cost basis that could have been started back in the 1980s & 3 or 4 carriers over the years while in deferral.
You can write Lincoln's i4Life and get an exclusion ration without annuitizing...