Do Not Throw Annuity Darts at Your Death

Today’s topic might sound strange but hear me out: don’t throw annuity darts at your death. You’re probably thinking, “Wait, what? Annuity darts?” Yep, annuity darts. I get calls all the time that go something like this:

“Hey Stan, I’ve watched a ton of your videos. I really like your hat, and I’m from North Carolina too. I don’t need income now, but when I die, I want income to start for my spouse. What do I buy now to make that happen?”

That’s what I call throwing annuity darts at your death. You’re buying something today for an event you don’t know the timing of. Unless you’ve got an expiration date on your calendar (and if you do, please don’t tell me, that’s creepy), you shouldn’t buy a product based on a guess.

The Problem with Buying Too Soon

Nobody knows when they’re going to die. So, if you plan to take care of your spouse after you’re gone, you don’t need to buy an annuity now to do it.

Here’s the truth, and the annuity sales gods are probably rolling their eyes at me right now for saying it: don’t buy something today for income you won’t need until you’re gone.

Instead, handle it through proper estate planning.

The Right Way to Do It

If your goal is to make sure your spouse has guaranteed income after your death, here’s what you should do:

Go to your estate planning attorney, not an agent, and tell them, “When I die, I want a Single Premium Immediate Annuity (SPIA) to be purchased for my spouse.” You can even specify the income amount. For example, if your spouse needs $2,525 a month, your lawyer can include instructions to purchase an annuity using a specific lump sum to generate that income.

You can even go to The Annuity Man and run real time SPIA quotes to see exactly what that payout looks like today. That’s how you plan it right, without wasting money or guessing on your death date.

Why “Buy It Now, Turn It On Later” Doesn’t Work

Some salespeople, let’s call them “Johnny Appleseed agents”, will tell you to buy an annuity now and let your spouse “turn it on when you die.”

Technically, you can do that. But it’s not efficient. You’re paying fees, locking up money, and losing flexibility for years, sometimes decades, before it’s ever needed.

Instead, keep your powder dry. Military folks out there know what that means: stay ready, but don’t waste ammunition. Set things up legally so the annuity is purchased at your death, not before.

Death Isn’t a Strategy (At Least Not One You Can Practice)

I always say, “Death is not a good strategy, because you can only use it once.”

You can, however, prepare for it. Work with your estate planning lawyer to include instructions in your trust or will. That way, when you die, your spouse’s income stream is automatically triggered by law, not by an agent’s promise.

That’s what I’ve done for my own wife, Christine. When my rented Learjet hits the mountain, and trust me, it’ll be a headline. Income will be triggered for her immediately through our estate plan. That’s how you do it right.

Ignore the Sales Pitch

The big sales pitch you’ll hear goes something like this:

“Buy my Indexed Annuity with an Income Rider. It’ll grow and grow and grow, and your spouse can turn it on later.”

That’s pure sales fluff. Income Riders don’t grow forever. They grow at a stated rate on a phantom value used only for calculating future income, not for cash value. Don’t get distracted by smoke and mirrors.

If your goal is to protect your spouse and guarantee income after you’re gone, do it legally through your estate plan, not through a premature product purchase.

How It Should Work

Here’s the ideal setup: you pass away, your spouse is sad (hopefully), and after the funeral, maybe between her new Lamborghini rides, your lawyer calls and says, “In your husband’s trust, it states that we are to purchase a lifetime income annuity using X amount of money.”

That triggers the income stream right when it’s needed, no guesswork, no wasted years of accumulation, no agent holding your money hostage in a bad contract.

The Bottom Line

If your death is part of the income strategy, then structure it to trigger at your death, not before. Keep your powder dry. Put it in writing with your estate planning attorney. Don’t throw annuity darts hoping to hit a bullseye at a future date you can’t predict. And yes, I can already hear the sales guys screaming at me for saying this. “Stan, you’re telling people not to buy an annuity!”

That’s right, because it’s the truth.

When the time comes, you, or your estate, can use The Annuity Man to shop every carrier and find the best SPIA payout for your spouse. That’s how you handle annuities with honesty, logic, and integrity.

I’m Stan The Annuity Man. Thanks for joining me. See you next time!