Annuities

The Heightened Risk of Bonds for Near Retirees

Fixed Annuities for High Net Worth Individuals

Fixed Annuities

When Interest Rates Rise

John Peterson,
CFP®, CLU®, ChFC®, RICP®, CASL®
Partner
Direct Line: 404.604.2678
john.peterson@simplicitygroup.com

Recent Widow

client age 78
adult children live out of town
concerned about future health care costs and wants to stay in her own home
health concerns- controlled diabetes with history of heart disease
income is enough to cover living expenses and liquid assets provide 6-month emergency cushion
exiting variable annuity valued at $100,000 that is no longer needed for retirement and no longer fits her risk tolerance profile

Solution:

1035 exchange into Long-Term Care Fixed Annuity which provides LTC benefit pool of $300,000
Benefits are paid up and guaranteed
Provides home and facility care coverage
She has now protected her income from an unexpected long-term care event

Highly Compensated Doctor

Solution:

Reposition $2 million of existing cash and low yielding investments into a fixed annuity with guaranteed lifetime income rider
$227,250 annual income available at age 65, $300,100 if client decides to wait until 70 to start lifetime income payouts
Income is guaranteed to grow during deferral and lifetime income payout can be started anytime which provides flexibility for retirement
Cash value and death benefit remain growing and are not subject to market or interest rate risk loss
Client has peace of mind knowing that a baseline of lifetime income is secured