Michael fink and wade pfau annuities1/17/2024 ![]() I am the Professor of Retirement Income at the American College of Financial Services in Bryn Mawr, PA. In 2013 Pfau joined McLean Asset Management as Director of Retirement Research. Pfau is a Professor of Retirement Income in the new PhD program for Financial and Retirement Planning at The American College in Bryn Mawr, PA. But there is no information about what failure means." - Michael Finke.American College of Financial Services in Bryn Mawr, PA. "If we model out 1000 different potential retirements, the ones who will have an annuity will, on average, be happier, but the ones with an investment portfolio might have a slightly higher probability of success. There are options that could help you have some stability through it, like social security and I Bonds. ![]() Also, there’s no perfect product to solve for inflation. If you can be more flexible, then inflation’s impact won’t be that big of a deal. You have to decide how you could spread out your savings to accommodate your lifestyle until you die or if you want to spend more money to have less worry. It’s not going to be easy, but you must first recognize that you’re not going to live forever. You have to choose if you want to shoulder the risk or transfer it. When buying an annuity, you're essentially buying yourself a minimum standard of living forever, no matter how long you live. There’s no perfect product to solve for inflationĪt the time of this episode’s taping, near-retirees can lock in 5.2% on five-year MYGAs for the next five years however, it may go up or down. In this episode, The Annuity Man and Michael Finke discuss:Ĭutting little slices on the birthday cake "There are annuities that aren't light switch annuities: SPIAs, DIAs, and QLACs - but there are annuities that are light switch for income, MYGAS, and then income riders which are lifetime income products." - Stan The Annuity Man. Another light-switch product is an income rider attached to an indexed annuity. It allows you to take out interest while keeping the capital intact, and it’s a light-switch annuity product. The three types of irrevocable income lifetime income streams are Single Premium Immediate Annuity, Deferred Income Annuity, and Qualified Longevity Annuity Contracts.Ī Multi-Year Guaranteed Annuity is the annuity industry version of a CD. One reason could be if tax laws change in the future and you want to shut down the income stream to not get taxed, or when you want the income to accumulate for your death benefit. There’s a myriad of reasons why you would want to stop taking income, and there are annuity reasons that allow for this. Three types of irrevocable income lifetime income teams Why would you want to stop taking in income? But wouldn't it be good to know regardless of what happens, that they're taken care of? And that lifetime income stream is going to be in place?" - Stan The Annuity Man. "Death is not a good strategy, because you can only use it once. Your beneficiaries might not react positively to you giving them income instead of a lump sum, but handcuffing them contractually is the right thing to do and it will be good for them in the long run. Stan has written in the trust that when he dies, there will be a lifetime income annuity purchase for each of his daughters, guaranteed to pay them for the rest of their life as long as they are breathing. ![]() Lovingly handcuffing your beneficiaries with annuity guarantees protects them from making dumb decisions with lump sums. Handcuffing your loved ones is good for them How Stan lovingly handcuffs his beneficiaries Protecting your beneficiary from dumb choices In this episode, The Annuity Man discussed:
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