SINGLE PREMIUM LIFE

You mean do a 1035 exchange to an annuity?

Not necessarily. Almost All Life & Annuity contracts have options in the contracts to annuitize the cash values or death benefit in a payout annuity supplementary contract in the "How we pay" section. But sure a 1035 to a new contract might be an option, but usually not as the client that needs a Medicaid life expectancy payout is either too old for a new policy with most carriers
 
I don’t need insurance because I have money in the bank.

....and you say?

While that does seem like a great idea on the surface, having the money in a bank is actually the problem. Have you ever heard of the rule of 72? Are you aware that the money in the bank may very well be held up in probate and probably will be? So on, and so on.
 
So you are saying there are times when a MEC are good? can you elaborate? I thought MEC was always a bad thing thank you
 
So you are saying there are times when a MEC are good? can you elaborate? I thought MEC was always a bad thing thank you

in 99% of these cases, you are working with clients age 60-85 & many times in their 70s. A MEC really is not an issue in these cases. Keep in mind, a MEC is merely acting exactly like a NQ Annuity while alive, but like Life insurance at death.

Bank CDs report taxable interest on a 1099 every single year whether you receive the interest or not. A NQ Annuity, a MEC or even a 401k/IRA are tax deferred each year until you choose to take money out. a NQ Annuity & a MEC merely require when you pull money out, if ever, that you first have to take out the interest gains first (LIFO). But remember, you were required to be taxed on the bank interest each year whether you took it out or not.

Lastly, when you die, a MEC passes the entire policy income tax free, not just the current cash value, whereas a NQ Annuity would pass a tax bill at death for any of the deferred gains that were never taken out
 
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