Annuity, to good to believe?

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jcar
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Annuity, to good to believe?

Post by jcar » Sat Aug 01, 2020 8:42 am

Recently on another financial oriented site some one posted they have an annuity that pays a guaranteed 7.5% payout plus the rate of inflation and an "income doubler" for long term care. Seems incredible to me. Is there such a product offered and how is it referred too? I'm familiar with a SPIA and a variable annuity. Is there some sort of hybrid product. The comme ter did not mention amounts invested or insurnce companies. Any feedback is appreciated though I suspect this is one of those to good to be true deals.. Thanks.

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David Jay
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Re: Annuity, to good to believe?

Post by David Jay » Sat Aug 01, 2020 8:51 am

“Payout” includes return of principle (the money you gave them). An SPIA can give that payout, depending on your age. An automatic escalator is also available on an SPIA. You can pay for 1%, 2%, 3%, etc., annual escalator. True inflation adjustment appears to be no longer available.

Most here do not recommend paying for extra riders for long-term care, it really increases complexity and cost. Keep SPIA and LTC policies separate.
Prediction is very difficult, especially about the future - Niels Bohr | To get the "risk premium", you really do have to take the risk - nisiprius

Topic Author
jcar
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Re: Annuity, to good to believe?

Post by jcar » Sat Aug 01, 2020 9:15 am

Thanks. It was the payout that really got my attention. 7.5% I responded to the writer for details and company but haven't heard anything. I just reviewed his post again and it says it is a guranteed lifetime return.

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Stinky
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Re: Annuity, to good to believe?

Post by Stinky » Sat Aug 01, 2020 9:20 am

jcar wrote:
Sat Aug 01, 2020 8:42 am
Recently on another financial oriented site some one posted they have an annuity that pays a guaranteed 7.5% payout plus the rate of inflation and an "income doubler" for long term care. Seems incredible to me. Is there such a product offered and how is it referred too? I'm familiar with a SPIA and a variable annuity. Is there some sort of hybrid product. The comme ter did not mention amounts invested or insurnce companies. Any feedback is appreciated though I suspect this is one of those to good to be true deals.. Thanks.
Whoever posted that is posting both misleading and incomplete details.

What this sounds like is some type of a fixed indexed annuity with riders for both long term care and guaranteed withdrawal benefits. Those riders are expensive - I expect that the total fees internal to the product are 3-4% per year, every year. Those fees alone are enough to disqualify the product in my book.

Either the person who posted is a consumer who honestly doesn’t fully understand what he bought, or an agent who is trying to rope in new prospects.

You’re correct - this is too good to be true. Stay away!
It's a GREAT day to be alive - Travis Tritt

Gill
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Re: Annuity, too good to believe?

Post by Gill » Sat Aug 01, 2020 9:21 am

Much depends on your age. Single Premium Immediate Annuities are available for people in their 80's paying in excess of 12%.
Gill
Last edited by Gill on Sat Aug 01, 2020 9:24 am, edited 1 time in total.
Cost basis is redundant. One has a basis in an investment | One advises and gives advice | One should follow the principle of investing one's principal

Topic Author
jcar
Posts: 246
Joined: Fri Jul 03, 2015 9:41 pm
Location: NC

Re: Annuity, to good to believe?

Post by jcar » Sat Aug 01, 2020 9:23 am

Thanks for the responses. If they come back with any details I'll post here. Thanks

MathIsMyWayr
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Re: Annuity, to good to believe?

Post by MathIsMyWayr » Sat Aug 01, 2020 9:26 am

Stinky wrote:
Sat Aug 01, 2020 9:20 am
jcar wrote:
Sat Aug 01, 2020 8:42 am
Recently on another financial oriented site some one posted they have an annuity that pays a guaranteed 7.5% payout plus the rate of inflation and an "income doubler" for long term care. Seems incredible to me. Is there such a product offered and how is it referred too? I'm familiar with a SPIA and a variable annuity. Is there some sort of hybrid product. The comme ter did not mention amounts invested or insurnce companies. Any feedback is appreciated though I suspect this is one of those to good to be true deals.. Thanks.
Whoever posted that is posting both misleading and incomplete details.

What this sounds like is some type of a fixed indexed annuity with riders for both long term care and guaranteed withdrawal benefits. Those riders are expensive - I expect that the total fees internal to the product are 3-4% per year, every year. Those fees alone are enough to disqualify the product in my book.

Either the person who posted is a consumer who honestly doesn’t fully understand what he bought, or an agent who is trying to rope in new prospects.

You’re correct - this is too good to be true. Stay away!
If you cannot convince, then confuse them.

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