annuities vs. bond fund or other for nursing home resident

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annuities vs. bond fund or other for nursing home resident

Postby mickeymag » Sat Jan 05, 2013 11:54 am

My mom is in a nursing home and unable to make any decisions, so I handle her investments. Since my dad’s death in 2007 I have stayed the course with his decision to use annuities to accomplish some important goals:

Preservation of principle
Availability of funds to someone in a nursing home (as Mom is)
Tax-free, probate-free passing to children at Mom’s death

But recent reading in “The Bogleheads' Guide to Investing” disparaged annuities and I’ve been wondering if I shouldn’t be moving Mom’s money elsewhere as her 24 unities, with total values just under a million, mature. Also, I believe most of her annuities currently include a clause that allows a survivor in a nursing home to pull out money penalty free. (The implication here is that I might be able to close any accounts I like at any time, though I probably wouldn’t, lest I alarm siblings by straying too far from Dad’s plan. But another important implication is that if I purchase new annuities, I’m not sure someone already in a nursing home would be eligible for that penalty-free withdrawal clause.)

Conclusion: in particular, if I’ve been reading the right books, I’m wondering if a gradual shift into an indexed bond fund might be a good move, but I worry about how such an asset would pass to hiers, tax-wise, and also about, well, smoothness: her annuities are each written to pass in equal shares to three children—can that also be done with a bond fund? It might also be worth noting that Mom has over 100K in annual nursing home expenses as a tax shelter, and she has been in that home since 2008, current age 82, 15 years or more into an Alzheimer’s diagnosis, late stage. Oh, and she also has a pension and s.s. that meet a portion of her needs.

Thanks for making it this far if you did, and I look forward to reading your suggestions.
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Re: annuities vs. bond fund or other for nursing home reside

Postby dbr » Sat Jan 05, 2013 12:43 pm

In a case like this that is very specific to a personal situation and involves inheritance and tax issues, it might be wise to consult an elder care attorney and a good (not a schlepp) tax advisor.
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Re: annuities vs. bond fund or other for nursing home reside

Postby mickeymag » Sat Jan 05, 2013 2:25 pm

Mom already has an estate attorney and a tax man who has kept her from paying any taxes at all. And I do work with these people, but I guess before I talk to these people I’m trying to find out whether I’m right to be suspicious of advice that points toward annuities and whether the bond market is inherently too risky for her situation.

And whether anyone knows in general how assets in bond funds would transfer to heirs, esp. in terms of taxes and dispersment.
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Re: annuities vs. bond fund or other for nursing home reside

Postby ourbrooks » Sat Jan 05, 2013 2:48 pm

By "annuity" I presume you mean a tax deferring variable annuity. A key thing to remember is that earnings, not the original investment, are taxed on withdrawal. It doesn't matter who does the withdrawing, the owner of the annuity or someone inheriting the annuity. That would not be the case if the money were outside the annuity; then, the heirs would not have to pay taxes on either investment or earnings and is one of the reasons Bogleheads don't like variable annuities. Variable annuities are tax deferring vehicles, not tax avoiding vehicles.

If you withdraw the units from the annuity, you may be able to avoid any fees or charges by the annuity company, but you will owe taxes on the part of the withdrawals which comes from earnings. Depending on tax brackets, etc. it may make sense to withdraw more slowly.

If you do decide to take the money out, pay the taxes, and invest it in a stock or bond fund, she'll have to pay taxes every year on dividends or gains distributions, but the heirs would not pay any taxes on the full amount they inherit. At least in Vanguard's case, it's trivially easy to set up the distribution; just put in the names of the beneficiaries and the percentage for each one.

Something also to learn about is how the annuity has her money invested. It might already be in a stock or bond fund.
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Re: annuities vs. bond fund or other for nursing home reside

Postby dbr » Sat Jan 05, 2013 3:46 pm

mickeymag wrote:Mom already has an estate attorney and a tax man who has kept her from paying any taxes at all. And I do work with these people, but I guess before I talk to these people I’m trying to find out whether I’m right to be suspicious of advice that points toward annuities and whether the bond market is inherently too risky for her situation.

And whether anyone knows in general how assets in bond funds would transfer to heirs, esp. in terms of taxes and dispersment.


I think the problem is that there is no answer in general. In your case you presumably are taking the money out from under the terms of an annuity so that it is just held as an asset not in any kind of tax preferred account and not in a trust of any kind. Whether in fact that is what you will have done is what your experts need to clearly understand. In that case the asset transfers to the heirs according to the terms of the owner's will or according to the terms of any POD beneficiary designation that might have been placed on the asset. In that case the executor appointed in the will of the deceased presents the terms of the will or refers to the POD designation and with a death certificate in hand directs the custodian of the assets (a brokerage or fund company) to change the ownership designation to the heir. Is that what you are asking? But these are exactly the questions that one deals with the estate attorney to know and plan in detail. It is very dangerous to presume facts about a particular situation in absence of complete detail.

Taxes are also a question in detail. There are estate/inheritance taxes that come from the estate of the deceased. In general an heir does not pay taxes on simply receiving an inheritance. The situation of the heir can be complicated depending on what they are inheriting, such as a simple taxable asset, a tax preferred investment account, an interest in an annuity, as final beneficiary of a pass-through trust, etc. Nobody here knows exactly about any of those things, but your advisors do. It isn't clear what you are really asking.

As far as risk in bond funds, the question is in what you are comparing to. In general bond funds of high quality and short duration are considered to be low to very low risk investments, so it would be odd to think that the risk might be too high. Without detailed knowledge of the existing and possible annuities this question can't be answered. Also "annuities" is a label that covers a huge range of different types of financial arrangements, for each of which the answer is different.
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Re: annuities vs. bond fund or other for nursing home reside

Postby mickeymag » Sat Jan 05, 2013 3:59 pm

Thanks. Very interesting! I hadn’t realized that heirs of a stock or bond fund would not have to pay taxes on either principle or gains. Big difference.

Unfortunately, my dad and I never discussed any of the investments I would manage in the event of his death, so I don’t know the reasoning behind his purchase of annuities, except that I gather he felt he’d been burned in some other investment dealings and was looking for something that would preserve his remaining principle.

In my own reading since, an 80/20 bond/stock mix of indexed funds seems better suited to hedging inflation (Mom’s nursing home bills have about an 8% inflation rate) and also preserving principle, but am I right in thinking that even an 80% bond fund mix (or 100% bond for that matter) will leave her principle considerably more vulnerable than her 24 annuities (distributed between 7 companies)? If the names of the companies are important I can supply those.
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Re: annuities vs. bond fund or other for nursing home reside

Postby mephistophles » Sat Jan 05, 2013 4:12 pm

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. You need to read the contracts and any accompanying literature to find out all the details and annuity options. Then you can compare the annuity with other fixed investments including bonds, C.D.'s or even savings accounts.
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Re: annuities vs. bond fund or other for nursing home reside

Postby dbr » Sat Jan 05, 2013 4:20 pm

mickeymag wrote:Thanks. Very interesting! I hadn’t realized that heirs of a stock or bond fund would not have to pay taxes on either principle or gains. Big difference.

Except that it is more complicated than that. If the heirs of an investment sell that investment they do have a tax cost on gains from their basis. That basis may be a stepped-up basis from date of inheritance (with a couple of additional small quibbles), but the basis could also be the basis from the time of death of your father if the assets are in a pass-through trust with your mother as beneficiary and you as heir. This is what I am trying to explain about understanding who has inherited what when. If the assets are inherited in the form of any kind of tax preferred account, including annuities, you would have to look at the exact details to know what is what. Also, while heirs do not pay an inheritance tax, the estate from which they inherit has to pay inheritance tax (which may be zero after exclusions) which then reduces the amount of estate to be inherited. Again, if there are trusts involved, this can be very complicated.

Unfortunately, my dad and I never discussed any of the investments I would manage in the event of his death, so I don’t know the reasoning behind his purchase of annuities, except that I gather he felt he’d been burned in some other investment dealings and was looking for something that would preserve his remaining principle.

Here again there are annuities of every flavor. The outcome will be hugely different depending on what you are talking about. The biggest single issue is between deferred annuities that hold investments and fixed immediate annuities which are income streams that may or may not terminate with or without a residual on death of the annuitant. Again things change if these are inside a trust.

In my own reading since, an 80/20 bond/stock mix of indexed funds seems better suited to hedging inflation (Mom’s nursing home bills have about an 8% inflation rate) and also preserving principle, but am I right in thinking that even an 80% bond fund mix (or 100% bond for that matter) will leave her principle considerably more vulnerable than her 24 annuities (distributed between 7 companies)? If the names of the companies are important I can supply those.

The question would be better suited compared to what? A portfolio of 100% TIPS is exactly hedged to inflation and highly secure as to principal as measured by CPI but certainly not to the costs of a person whose expenses increase at 8% pa. A mix of 80/20 nominal bond/stocks would not have any particular security in a time of high inflation. The riskiness of the annuities depends on the terms of the annuities and how they are invested if the terms depend on the investments. Note that single premium immediate annuities, if that is what you have, might be fixed and have no protection against inflation but are guaranteed for payout and longevity or might be inflation indexed by CPI. If there are really 24 annuities, etc., this is going to take a detailed look that maybe a financial planner might best examine. Annuities other than SPIA types are usually so hard to understand that I doubt anyone here is going to be able to analyze the situation, although volunteers are welcome, one is sure.


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Re: annuities vs. bond fund or other for nursing home reside

Postby bsteiner » Sat Jan 05, 2013 7:40 pm

Annuities allow you to protect against living too long, but at a cost. You give up some flexibility, your investment return is all ordinary income, you give up basis step-up at death, and the costs are not insignificant.

You probate the Will, not the assets. Probating a Will is generally not particularly difficult or expensive, and even in whatever state in which it's the most difficult, it will still probably be far less expensive than the cost of the annuity.

Like living trusts, timeshares and bridges, annuities are occasionally appropriate, but when someone suggests an annuity, a living trust, a timeshare or a bridge, be careful.
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Re: annuities vs. bond fund or other for nursing home reside

Postby mickeymag » Sun Jan 06, 2013 11:55 am

Thanks again for all your help, folks.

I’ll provide a heap more information below, but perhaps better still, I wonder how forum users would respond if the question were framed as the following multiple choice:

a) annuities are probably not as good for your mom and your family as other options
b) the situation is so complex you should hire an independent financial adviser
c) both of the above

More Information

First, I’ll try to shine some light on a couple of points that have raised:

“Again, if there are trusts involved, this can be very complicated.” [by dbr] There is no trust involved in this case; try as he might, my dad’s estate attorney could not convince him to go the trust route.

“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. But while I also understand (before and even more now) that there are some mind-boggling complexities involved here, I’m still hoping for a better clarification of the value of annuities in Mom’s situation: 82 years old, nursing home with later stage Alzheimer's, $100K pa non-taxable nursing home costs, three children as primary heirs.

As someone just beginning to learn about investing, I never doubted my dad’s annuity decision until reading the following in “The Bogleheads' Guide to Investing”:

Because of their high costs and surrender fees, and the decreased tax benefits of annuities in relation to more tax-efficient investments available, annuities really don’t have much to offer most investors. It’s probably safe to say that most annuities are sold and not bought. We’ve heard horror stories about unscrupulous annuity sales folks who sold inappropriate annuities with high surrender fees to trusting older folks who were in a low (or no) tax bracket and had absolutely no need for a high-priced tax-deferred annuity product. There are a number of other lower-cost, tax-deferred, and tax-free investment options available, such as 401(k) plans, IRAs, Roth IRAs, and other retirement plans. Investors should fund these retirement plan options before even considering a variable annuity. (44)

This seemed to speak to my mom’s situation, especially since she has since entered a nursing home which means her income is generally all non-taxable. Am I wrong to think so?
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Re: annuities vs. bond fund or other for nursing home reside

Postby bsteiner » Sun Jan 06, 2013 12:16 pm

I think (a) is the correct answer, but if you want some help understanding the annuities, the first step is to gather the most recent statement from each of them and then see if you can find someone to help you figure out the costs, and whether any of them have a death benefit in excess of the current value (in which case she might hold on to those).

Since she's in a nursing home and has large medical expense deductions, that gives her an opportunity to cash in some of the annuities without having to pay income tax on the gain. To the extent she can do so, that will stop the bleeding from the expenses in the annuities, and it will eliminate the income tax to the beneficiaries on that gain.

If any of her children might have a taxable estate, or be concerned about potential creditors, including spouses if a child should get divorced or outlive his/her spouse and remarry, she might update her Will to provide for her children in trust rather than outright, with each child controlling his/her own trust. Of course, the tradeoff for that is that any income accumulated in the trusts is likely to be taxable at a higher rate than if it were distributed, and the trust assets won't get a basis step-up at the child's death. (I'm writing an article right now on how the American Taxpayer Relief Act of 2012 increases that cost.) The income tax cost may not be that much if the trusts invest for qualified dividends, growth, long-term capital gain and tax-exempt income. For this purpose, control means that the child is a trustee of his/her trust, can remove and replace his/her co-trustee (provided the replacement is not a close relative or subordinate employee), and has the power to appoint (give or leave) the trust assets to anyone he/she wants (other than the child or his/her estate or creditors).
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Re: annuities vs. bond fund or other for nursing home reside

Postby dbr » Sun Jan 06, 2013 1:15 pm

While it is a simple and good decision to avoid any but SPIA's in the first place, it is not simple to undo annuities. As a starter there will be the issue of surrender fees. It really is necessary to see exactly what will happen in each case. Also annuitizing in the case of a person who may not have a long expectation of living involves a lot of conditions regarding how assets can still survive and be passed to heirs.

I guess I am an advocate of getting expert advice based on having just enough knowledge to be dangerous, which impresses me with the need to look very closely at everything.

Also, a major consideration here is simply the scale of things, meaning the total amount of money involved and also the present dilemma regarding income and the magnitude of that. I don't mean I need to know those things, but that your situation is very different if you are talking about estates like $5 million versus estates of $500,000 or something. This is partly a question of inheritance and tax issues but also a question of the extent to which the estate is likely to be exhausted anyway.
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Re: annuities vs. bond fund or other for nursing home reside

Postby Mel Lindauer » Sun Jan 06, 2013 1:37 pm

As one of the co-authors of The Bogleheads' Guide to Investing, I'd like to clarify our feelings on annuities.

1. We're not big fans of variable annuities except in rare cases.
2. Some fixed annuities which are CD-like have the "teaser rates" you mentioned and then pay below market rates for long periods where you can't get out without paying a surrender fee.
3. We don't care for Equity-Indexed Annuities.
4. We do believe Single Premium Immediate Annuities (SPIAs) can be good for some investors, and it sounds like you're using this vehicle to fund your Mom's living expenses, so they certainly seem appropriate in your situation. It's good that you're only annuitizing and purchasing SPIAs on a partial (as needed) basis.

Here are links to a series of columns I did on annuities for Forbes. Each column covers a different type of annuity and goes into more details:

Annuities: Good, Bad Or Ugly?
http://www.forbes.com/2010/06/04/variab ... dauer.html

How To Cut The Cost Of A Variable Annuity
http://www.forbes.com/2010/06/18/variab ... dauer.html

Variable Annuities Don't Belong In Retirement Plans
http://www.forbes.com/2010/07/02/variab ... dauer.html

Fixed Deferred Annuities: CDs With Gotchas
http://www.forbes.com/2010/07/16/fixed- ... dauer.html

For Some Retirees, This Annuity Makes Sense
http://www.forbes.com/2010/07/29/single ... dauer.html

The Truth About Equity-Indexed Annuities
http://www.forbes.com/2010/08/10/truth- ... dauer.html
Best Regards - Mel | | Semper Fi
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Re: annuities vs. bond fund or other for nursing home reside

Postby mephistophles » Sun Jan 06, 2013 6:31 pm

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.


Hi Mickey,
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.
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Re: annuities vs. bond fund or other for nursing home reside

Postby ourbrooks » Sun Jan 06, 2013 6:57 pm

My understanding of the OP's posts are that he believes that his mother's income is tax free because she lives in a nursing home. This cannot be the case; there's no provision of the federal tax code that elminates taxes for people in nursing homes or medical facilities.

What the federal tax code does do is provide a limited deduction against income for medical care expenses; since his mother suffers from Alzheimer's, nearly all of the nursing home expenses are considered medical expenses. What her accountants have probably been doing is withdrawing enough from the variable annuities to cover the nursing home expenses; the earnings in these withdrawals are balanced by the medical care deduction so she doesn't end up paying anything.

That would not be the case if she withdrew more than the cost of the nursing home. In order to take money out of the variable annuities and put it into some other vehicle, you'd have to withdraw more than the costs and you'd have to pay taxes on any earnings in the annuities. That's the big problem. As Mel points out, variable annuities are not good things, but paying the taxes to take the money out of them might cost a lot, especially if it were done in big chunks.
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Re: annuities vs. bond fund or other for nursing home reside

Postby bluemarlin08 » Sun Jan 06, 2013 7:24 pm

I seriously doubt that any of the annuities are variable annuities. I have met with many senior citizens that bought fixed rate annuities like others bought CD's. You really need to personally review all the contracts or hire someone to do it. You might discover some of them are crediting very competitive rates.
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Re: annuities vs. bond fund or other for nursing home reside

Postby Bob's not my name » Sun Jan 06, 2013 8:31 pm

I manage a situation similar to yours. I can't comment on the annuities, but I can tell you what I'm doing. I am trustee for an elderly person in assisted living. Annual income is about $150,000 and tax bracket is 0%. The ATRA tax breaks on qualified dividends and long term capital gains are a great deal for wealthy seniors. The deductible medical expenses (above 7.5% AGI) are about $110,000, and the income above these itemized deductions plus the personal exemption is all qualified dividends and long term capital gains, so there is zero tax due.

Investing in the 0% tax bracket is quite liberating. I have some of the money in brokered long term CDs. 30- and 20-year CDs pay better rates than short term CDs or bond funds, and the death put feature (also called the survivor option or flower provision) allows you to liquidate at par on death. Put another way, you get a good interest rate and preservation of principal (whether your principles are preserved is a separate question). The longer term CDs are often callable, so you want to look closely at the no-call period. For example, for a person with a life expectancy of 2 years, a mix of non-callable (10-year, typically) CDs, callable CDs with a no-call period over 2 years, and callable CDs with shorter no-call periods is probably a reasonable mix.
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Re: annuities vs. bond fund or other for nursing home reside

Postby mickeymag » Wed Jan 09, 2013 9:58 pm

What a wealth of information, folks. Really, I appreciate your careful consideration and thoughtful advice. I’m picking up very valuable information, and in particular I grasp now what I should have figured out before, ourbrook’s point that if I tried to do some sort of conversion to a bond fund or some such I could get clobbered with taxes. Ourbrooks has surmised correctly that the tax accountant and, actually, the annuity guy have been working together to use taxable monies in the annuities to pay for nursing home expenses. That is, after a couple of taxable IRAs were depleted.

Also, I suspect these annuities are the fixed type you likened to CDs; in fact, that’s what sort of raised my question in the first place, the fact that sometimes these come up for renewal, actually, and we have pulled money out of one and gotten into another with a new juice teaser, and probably a percentage for the salesman, of course.

But the picture is clarifying for me, and for that I thank you all very much. My plan now:
1) Stop worrying about a need for some big change, whether or not the annuities were a good idea in the first place.
2) As opportunities arise to get out of an annuity I can consider that carefully at that time, and perhaps use the taxable money to pay expenses and move the non-taxable into perhaps a long-term CD like Bob’s not my name mentions, or perhaps a bond fund.
3) Ask an independent financial expert to look over the situation at some point, perhaps when I consult over my own situation.
Many thanks, again, to you all. You’ve been a big help.
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Re: annuities vs. bond fund or other for nursing home reside

Postby Bob's not my name » Thu Jan 10, 2013 5:30 am

mickeymag wrote:the tax accountant and, actually, the annuity guy have been working together to use taxable monies in the annuities to pay for nursing home expenses. That is, after a couple of taxable IRAs were depleted.
I hope some of the annuity experts will comment on why it makes sense to deplete IRAs before tapping annuities. Doesn't make sense to me, but I don't know anything about annuities.
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Re: annuities vs. bond fund or other for nursing home reside

Postby mephistophles » Thu Jan 10, 2013 4:06 pm

Bob's not my name wrote:
mickeymag wrote:the tax accountant and, actually, the annuity guy have been working together to use taxable monies in the annuities to pay for nursing home expenses. That is, after a couple of taxable IRAs were depleted.
I hope some of the annuity experts will comment on why it makes sense to deplete IRAs before tapping annuities. Doesn't make sense to me, but I don't know anything about annuities.


Not sure if I missed something in this thread, but maybe they decide which to tap based on interest earnings on annuities vs. IRA's, and of course, if the surrender charges are past on the annuity.
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Re: annuities vs. bond fund or other for nursing home reside

Postby mickeymag » Fri Feb 01, 2013 10:49 am

By my recollection (2-4 years or so old) these particular IRAs were taxable should they pass to heirs, whereas the annuity principles (not earnings) were not. Does that make (more) sense?
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Re: annuities vs. bond fund or other for nursing home reside

Postby ResNullius » Fri Feb 01, 2013 11:18 am

You mentioned that you had siblings, meaning more than one brother/sister. Given your mother's condition and the specific nature of your dad's wishes prior to his death, I would be very reluctant to change anything. If you make a change that turns out to be less than wonderful down the road, you could have serious problems within your family vis-a-vis funding your mom's care and inheritance among the adult children. I would be very, very careful not to ignite a family falling out.
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Re: annuities vs. bond fund or other for nursing home reside

Postby mickeymag » Wed Feb 06, 2013 2:07 pm

f you make a change that turns out to be less than wonderful down the road, you could have serious problems within your family


Sage advice, and that was my original thinking, until I started to think that making no changes was also a form of neglect, but I'm actually delighted to know that this is a reasonable way of proceeding.

I have my hands full trying to make sense of my OWN retirement schemes;-)
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