"My Husband Already Has an Annuity. Not Sure if I Want Another."

[AllGold]

This is a 55 year old who changed jobs and we've been talking about a 401K rollover. Husband is 56 (he hasn't changed jobs as far as I know so I was surprised to hear about his annuity).

I don't have all or even most of the information I need so we'll need to talk more.

I don't have a good grasp of what non-annuity products are available and just wondered what I might be up against. I don't know what I don't know but it seems to me it's hard to beat an annuity for no risk and guaranteed lifetime income. Am I wrong?

 

[VolAgent]

You're wrong.

It appears you really haven't even gotten a good grasp of their financial situation. I could easily assume the same concerning their financial objectives and tolerance for risk. Perhaps something with more reward potential that has more risk would better meet her objectives.

For anything other than an annuity, you will need to be securities licensed.

 

[jacobtn]

While I hope we are never forced to be securities licensed to offer FIAs, it's posts like these that remind me why regulators are pushing for it. Good grief.

This is a 55 year old who changed jobs and we've been talking about a 401K rollover. Husband is 56 (he hasn't changed jobs as far as I know so I was surprised to hear about his annuity).

I don't have all or even most of the information I need so we'll need to talk more.

I don't have a good grasp of what non-annuity products are available and just wondered what I might be up against. I don't know what I don't know but it seems to me it's hard to beat an annuity for no risk and guaranteed lifetime income. Am I wrong?

 

[xrac]

This is a 55 year old who changed jobs and we've been talking about a 401K rollover. Husband is 56 (he hasn't changed jobs as far as I know so I was surprised to hear about his annuity).

I don't have all or even most of the information I need so we'll need to talk more.

I don't have a good grasp of what non-annuity products are available and just wondered what I might be up against. I don't know what I don't know but it seems to me it's hard to beat an annuity for no risk and guaranteed lifetime income. Am I wrong?

If you really want to help these people it sounds like you need to take someone with you who knows what they are doing.

 

[AllGold]

As I said, this is very preliminary. I haven't done any kind of needs assessment or even talked to them enough to really know what their goals are.

And yes, I am new to annuities and will get lots of help from my upline.

But my real question hasn't been answered. If someone's goals are

1) no risk
and
2) guaranteed lifetime income (with or without inflation protection),

what is better than an annuity?

 

[DHK]

But my real question hasn't been answered. If someone's goals are

1) no risk
and
2) guaranteed lifetime income (with or without inflation protection),

what is better than an annuity?

Uh... that's what an annuity is FOR. Nothing does it better than an annuity.

The next part will be: what kind of annuity structure/product will you be recommending?

 

[iceco1d]

As I said, this is very preliminary. I haven't done any kind of needs assessment or even talked to them enough to really know what their goals are.

And yes, I am new to annuities and will get lots of help from my upline.

But my real question hasn't been answered. If someone's goals are

1) no risk
and
2) guaranteed lifetime income (with or without inflation protection),

what is better than an annuity?

You should amend that to say "No STOCK MARKET risk." There are structured products out there that are superior to FIAs and have "no risk." But they are still subject to the ability of the i-bank that engineered the product to make good on their claims.

 

[yogooglethis]

As I said, this is very preliminary. I haven't done any kind of needs assessment or even talked to them enough to really know what their goals are.

And yes, I am new to annuities and will get lots of help from my upline.

But my real question hasn't been answered. If someone's goals are

1) no risk
and
2) guaranteed lifetime income (with or without inflation protection),

what is better than an annuity?

Depends on their retirement date and income needed to live on..low cost index mutual funds might be suitable. Make sure you disclose the difference between taxes on ordinary income from an annuity pay out and capital gains when the money is taken out

Personally I would run from an adviser who would suggest buying an annuity in a tax qualified account .

 

[Tahoe Ray]

Depends on their retirement date and income needed to live on..low cost index mutual funds might be suitable. Make sure you disclose the difference between taxes on ordinary income from an annuity pay out and capital gains when the money is taken out

Personally I would run from an adviser who would suggest buying an annuity in a tax qualified account .

The 401k will become a rollover IRA account...no difference in taxes-all ordinary income.

 

[rikwells]

The 401k will become a rollover IRA account...no difference in taxes-all ordinary income.

That is correct. Taxes from an IRA are the same if annuity or index mutual fund is held in IRA.

The reason why an advisor would recommend an annuity for an IRA is not for tax deferral, but for either principal protection guarantee or a living benefit guarantee such as lifetime income.

Bring someone with you on this appointment. There are 3 things you need to understand before making any investment recommendations:

1. Investment Objective
2. Time Horizon
3. Risk Tolerance

If you don't know those 3 things you certainly can't recommend an annuity right of the bat. Do your best to stand in their shoes and the rest is easy.