mickeymag wrote:“First, it is necessary to learn exactly what kind of annuities are owned. Sounds like a fixed deferred annuity, but not enough information to be certain.” [by mephistophles] I realize a full review of all 24 may be in order, but I know this much: they feature a high teaser rate for a year or two and then settle into much lower, fixed returns that roll back into the account; some, perhaps all, can and some have been “annuitized,” meaning they were converted into something that paid monthly until emptied (SPIA?)—we’ve done this with four of an original 28 annuities. With the help of the tax accountant we have already spent almost all the taxable monies on Mom’s nursing home bills, which prevented taxes.
I understand that the ideal way to proceed here would be a careful review, probably by myself and by a financial professional, of all 24 of Mom’s annuities. But before I begin a time consuming and potentially expensive rethinking of my Dad’s decision to go with annuities, I’m trying to figure out whether such a review is called for.
You appear to be new to Bogleheads so I will tell you, very briefly, where my advice comes from. I am in my 43rd year as a life insurance agent, have a CLU (Chartered Life Underwriter), have been posting on bogleheads since its inception, wrote two chapters on insurance in "Bogleheads Guide to Retirement Planning." I have sold annuities over the decades, but only on occasion and where they were appropriate. Of importance, I do understand annuities and most insurance products.
That said, each situation is personal and should be reviewed and studied based on its own needs and merits. That applies in your parents case. It "appears" we are dealing with possibly just one type of annuity product here--fixed deferred annuities with a fixed interest rate not linked to stock market performance. Fixed Deferred Annuities (FDA) are just one of many kinds of annuities. So, if you want the best advice that applies to the specific products, it is absolutely necessary to know exactly what those products are, how they work, what interest rates are involved, how long the annuites are in force at guaranteed rates, renewal options and rates; fees, expenses and surrender charges on the existing products, and other information of this sort. The agent or financial person who sold all these annuities should be available to help provide all this information without any assumption of buying anything new.
Again, any advice you get here on other types of annuities such as equity income annuities, immediate income annuities, variable annuities, and so on may be wonderful advice for those products, but a lot of that information will not apply to your situation.
Bottom line, you must do the work to thoroughly understand all existing products before you are able to make any informed decisions on what to do with those products in the future and if other alternatives are appropriate. Also, you need POA or your parents agreement to be involved.