- 10,806
Im pretty sure the product at hand is NYLs "Deferred Immediate Annuity". They call it the "Future Income Annuity".
Yes, the name is an oxymoron, but its a real product.
It acts kinda sorta like an IA w/ Income Rider but not exactly.
Its a Lifetime SPIA with a mandatory 2 year deferral before taking income.
The catch is that no accumulation is credited during deferral. They hypothetically give you a higher payout rate the longer you defer (depending on the performance of their portfolio.. its not necessarily guaranteed).
I had a NYL wholesaler stop by a few months ago to talk about the product... here is an excerpt of our conversation:
-Me: "How much the money earns in deferral?"
-Him: "4.2%".
-Me: "So your money grows at 4% until you take income?"
-Him: "Well, thats what NYL makes on it."
-Me: "say what??"
-Him: "Well.... NYL is currently making around 4% on it, and they credit that towards higher payout rates"
-Me: "So NYL raises the payout rate on some kind of "prorata" (for lack of a better word) basis in relation to the return they earn?"
-Him: "Well, no. But the more they earn the more they are able to pay down the road.."
-Me: "So my money could sit there for 40 years and not earn a dime, and I still get the same payout rates of today (hypothetically)"
-Him: "Well.... yeah, I guess thats right.."
I will give them credit that the payout rates are competitive.
And its taxed as a SPIA, as opposed to an income rider.
Its not a bad product necessarily... but you can get a higher income from an IA w/ bonus & income rider.
Also, you give up liquidity unlike an IA w/ Rider...
To hit on M&Ms comments; you need to know what you are selling!!!!!!!!!!!!!!!!!!
You work for NYL... right?
With company resources you should know the product you sell backwards and forwards.
You owe that to your clients.
Once you actually understand the products, you will realize how to effectively utilize them with clients.
To answer your question:
Yes. All companies play by the same rules technically. All SPIAs are taxed the same.
This product is supposedly patent pending.. but I doubt it would actually hold up if this product takes off and others replicate it... history says it wouldnt.
You can bet other carriers are watching this product. But none have jumped for obvious reasons.
This is the first answer to come from the Big Mutuals to compete against the Income Riders....
Yes, the name is an oxymoron, but its a real product.
It acts kinda sorta like an IA w/ Income Rider but not exactly.
Its a Lifetime SPIA with a mandatory 2 year deferral before taking income.
The catch is that no accumulation is credited during deferral. They hypothetically give you a higher payout rate the longer you defer (depending on the performance of their portfolio.. its not necessarily guaranteed).
I had a NYL wholesaler stop by a few months ago to talk about the product... here is an excerpt of our conversation:
-Me: "How much the money earns in deferral?"
-Him: "4.2%".
-Me: "So your money grows at 4% until you take income?"
-Him: "Well, thats what NYL makes on it."
-Me: "say what??"
-Him: "Well.... NYL is currently making around 4% on it, and they credit that towards higher payout rates"
-Me: "So NYL raises the payout rate on some kind of "prorata" (for lack of a better word) basis in relation to the return they earn?"
-Him: "Well, no. But the more they earn the more they are able to pay down the road.."
-Me: "So my money could sit there for 40 years and not earn a dime, and I still get the same payout rates of today (hypothetically)"
-Him: "Well.... yeah, I guess thats right.."
I will give them credit that the payout rates are competitive.
And its taxed as a SPIA, as opposed to an income rider.
Its not a bad product necessarily... but you can get a higher income from an IA w/ bonus & income rider.
Also, you give up liquidity unlike an IA w/ Rider...
To hit on M&Ms comments; you need to know what you are selling!!!!!!!!!!!!!!!!!!
You work for NYL... right?
With company resources you should know the product you sell backwards and forwards.
You owe that to your clients.
Once you actually understand the products, you will realize how to effectively utilize them with clients.
To answer your question:
Yes. All companies play by the same rules technically. All SPIAs are taxed the same.
This product is supposedly patent pending.. but I doubt it would actually hold up if this product takes off and others replicate it... history says it wouldnt.
You can bet other carriers are watching this product. But none have jumped for obvious reasons.
This is the first answer to come from the Big Mutuals to compete against the Income Riders....
The mother ship is a publicly traded company...
