ANNUITY

Types of Annuity Payment Structures

Unknown September 29, 2017 0 Comments

The cash an annuity can generate depends on a wide number of factors, from how the economy is performing, to the various riders which were added to it. However, one of the most important factors that is taken into consideration when selling an annuity, is the payment structure you’ve chosen.

There are literally thousands of different varieties of annuity products and contracts. However, most annuities fall into one of the following general categories of payment structure:

Fixed Annuities

Periodic payment from a fixed annuity is the same for the duration of the term, and is usually funded by a stable rate of interest from the insurer.

Variable Annuities

Variable annuities are funded by investments that are more prone to fluctuation, such as stocks and bonds. As a result, the periodic payments can vary over time.

The payment structure of your annuity plays a major role in determining whether or not we can purchase your annuity and the amount of the cash lump sum you’re we can offer you. For more information on how your repayment structure will affect your annuity payment sale, get in touch with one of our representatives.

Guaranteed vs. Life Contingent Annuities

Guaranteed payments will go to your beneficiary in the event that you pass away before all your guaranteed payments are made. Life-contingent payments will only be made as long as you are living. We can purchase both types of payments.

Annuity Riders

Along with payment structure, cash out options are also determined by specific riders that have been put in place on your annuity. Like a traditional insurance policy, riders can be added to your annuity. These modify the basic agreement, expanding or restricting the policy to give it the coverage and terms you want.

Medical Annuity Riders

A medical rider changes the scope of your annuity based on health or life events, providing additional benefits should the unexpected occur. Some common medical riders include:

Death Benefits: In many cases, annuity payout is life contingent, meaning that the insurance company only continues payments for as long as the purchaser is living. A death benefit rider lets your family continue receiving installment payments, or accept the balance of your investment in the form of a cash payout.
Long Term Care: This rider allows you to access the balance of your investment if you’re transferred to an assisted living community.
Impaired Risk: If you contract an illness that substantially reduces your life expectancy, an impaired risk rider may increase the monthly payout in the annuity.
Terminal Illness: In the event of a terminal illness diagnosis, this rider allows you to access a portion or even the remainder of your premium, likely without paying any surrender penalties.
Unemployment and Disability: Like the terminal illness rider, if you suffer a disability or lose your job, this rider will give you access to your premium. The provider will likely cancel all buy-back fees.

Financial Annuity Riders

Unlike medical riders, financial modifiers adjust your payments due to external factors, such as inflation. These riders can modify the repayment terms, or allow you to access all or a portion of the remaining premium.. Each insurance company will offer their own list of financial annuity riders, but some of the most popular include:

Inflation Adjustment: One potential downfall of a fixed annuity is that the purchasing power of a dollar tends to decrease over time. An inflation-adjusted annuity automatically increases the monthly payment to attempt to compensate for this.
Commuted Payout: Adding a commuted payout rider to an immediate annuity allows you to withdrawal a lump sum should an unexpected need arise. In most cases, this is a time-limited rider, only available during the first few years of payments.
Variable-Only Riders: Often used to supplement retirement income, a variable annuity gives your investment the best chance of growing, but also comes with certain financial risks like investing in stocks and bonds. To help mitigate the risk, many insurance companies offer special riders:

Guaranteed Minimum Accumulation Benefit: If, after the growth phase of your annuity, the total value is less than the total premium paid into it, a GMAB rider will adjust the balance to equal the premium, less any withdrawals made.
Guaranteed Minimum Income Benefit: The GMIB rider allows for a minimum monthly payment regardless of the performance of your annuity.
Guaranteed Lifetime Withdrawal Benefit: Typically, you have to convert a variable annuity to an immediate fixed annuity to receive an annual income for the rest of your life. The GLWB rider will allow you to draw on your variable annuity without converting it.

Benefits of Selling Annuity Payments

Life is unpredictable, and what made financial sense when you purchased your annuity might not be best for your today’s reality. Perhaps debt is hurting your credit score, you need instant access to cash to pay medical bills, or you want to make a sound investment like a house or education. Selling your annuity payments for lump sums opens the possibilities and places your financial future in your hands.

resource http://www.peachtreefinancial.com/our-solutions/annuities.aspx

Sell Annuity Payment Definition

Unknown September 29, 2017 0 Comments

The Basics

Selling Annuity Payments For A Lump Sum of Cash

Life may have changed quite a bit since you first set up your annuity. If so, it’s a good time to look at your annuity a bit differently. Peachtree Financial Solutions can turn all or some of your future annuity payments into one lump sum, so that you can put your money to better use – whether it’s for a bigger home, a more reliable car, tuition, or to pay off debt. You don’t have to wait. Find out how Peachtree can help you cash in all or part of your annuity payments.

What Are Annuities?

An annuity is a fixed or variable sum of money paid in increments over a predetermined period of time. The general purpose of an annuity is to provide a steady stream of income for the recipient. Annuities are used in a wide array of applications, from retirement plans to legal settlements to survivor benefits and more. In addition, some inheritances can be set up as annuities, and some annuities themselves can be passed down to a beneficiary.

In many annuities, the recipient collects the same amount of money each year, although some annuity contracts can have variable payments.

Types of Annuities

An annuity can be created for many different reasons, and Peachtree works with recipients of nearly every kind of annuity. The most common type is a Single Premium Annuity and it can be paid out in two different ways:

Single Premium Immediate Annuities

This type of annuity begins paying out within a year of being purchased. This type of annuity is purchased with the one-time investment of a lump sum, either from the purchaser’s personal savings, a retirement plan, or an inheritance.

Single Premium Deferred Annuities

This type of annuity is set to be paid out at a later date. This annuity type is purchased with the one-time investment of a lump sum, either from the purchaser’s personal savings, a retirement plan, or an inheritance.

Deferred Vs. Immediate Annuities

An immediate annuity offers a steady, predictable income starting within a year of purchasing, while also allowing you to determine the payback period and riders attached.

Deferred annuities delay the payment until the investor elects to begin receiving them. Deferred annuities consist of first investing money into the account, and then the income phase when it is converted into an annuity and payments are received.

Understanding your annuity options and how they affect your sale is an important part of planning your financial future, and Peachtree Financial is here to help.

resouces http://www.peachtreefinancial.com/our-solutions/annuities.aspx

Sell My Annuity Payment Lump Sum

Unknown September 28, 2017 0 Comments

When I wanted to sell my annuity payments lump sum, there were a few things I had to learn first. Here’s what I found out.

What Is an Annuity, Anyhow?

Before I tried to sell my annuity payments lump sum, I needed to learn a thing or two about what a structured settlement actually was. These annuities allow a person to have a stable source of income, which are usually tax- free payments. Often times, people receive annuities after certain court cases are settled. For example, a person might win an annuity as the result of their personal injury case, which would pay for their medical bills and other expenses as they recovered from the incident that prompted the case in the first place.

However, times can get tough. Life happens when you least expect it, after all, and the annuity payments may not be able to cover the costs associated with emergencies. Perhaps you need to fix your roof, or maybe a business opportunity appeared and you need capital to invest with, or maybe your youngest didn’t get enough financial aid. It’s reasons like these why I sold my annuity payments lump sum.

How Did I Sell My Annuity Payments Lump Sum?

I sold my annuity payments lump sum much the same way other people typically do.

First, I had to decide if I really wanted to sell my annuity payments lump sum. After all, it was a good chunk of my income. Losing it might have jeopardized my future financially. I needed to be sure whether or not it was really such a good idea.

Second, I needed to find a company to sell my annuity payments lump sum to. The key, as is the case so many other times in life, was to find a reputable company to work with, one that had its clients’ best interests in mind and used its own money to fund clients. It needed to be experienced, and have a top notch rating with the Better Business Bureau.

Third, I needed to get the ball rolling. No one was going to sell my annuity payments lump sum for me, after all. I had to submit the correct paperwork — the policy, my ID, the settlement agreement, and more — for review to ensure that the process would be completed properly.

Fourth, I had to have a judge’s approval if I wanted to sell my annuity payments lump sum. Once I got my paperwork back and the documents fully signed, I had an attorney file them with the court, which scheduled a hearing for me. This began my waiting period. When I got to court, I had to justify why I was trying to sell my annuity payments lump sum and show that I really did need the money. Basically, I had to prove that I wasn’t jeopardizing my financial future.

Lastly, I got my payment. Once the judge approved it, he signed the transfer order, sent it to my insurance company, and had the money wired.

And that was that.

How Long Did It Take to Sell My Annuity Payments Lump Sum?

Once everything was said and done, it took me about the same amount of time it takes for a person to typically get their money, which is about 45 days. However, keep in mind that each and every case is unique, and that different state laws may affect the time it takes for you to get the money you need.

Is It a Wise Option If You Have to Pay Off Debts?

One of the main reasons people sell their annuity payments lump sum is because they need to pay off debts. Whether or not it’s a good idea to do that, though, is up for debate. Some people may have some serious debt, and could wind up bankrupt. If they do face that problem, and their annuity is protected, then it’s a very, very bad idea.

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