Can I Move My Annuity To Another Company?

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Hi there, Stan The Annuity Man, America's annuity agent, licensed in all 50 states and

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Puerto Rico. I say that with an accent because Dr. V behind the camera is from Venezuela.

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I heard him speaking in Spanish. I'm like, man, I should hire that guy for our Spanish division.

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So, today's topic is a good one. Can you move your annuity from one

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company to another? And I'm assuming I'm going to add to that sentence:

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without tax consequences. I got that answer for you after this.

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So, can you move an annuity from one company to another? So, let's take a little bit of a

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step back foundational. You can have an annuity, there's many types, in a Roth IRA,

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a Traditional IRA, and a Non-IRA, non-qualified checking account type money. Okay? You can have it

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anywhere. Just that what happens is the taxation of the money when you come out is going to be

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different from a Roth, which is tax-free, from an IRA, which is taxable. Non-qualified depends

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on the product. It's either all going to be taxable or some of it's going to be taxable.

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But can you move an annuity from one to the other? Well, that's a little complicated.

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Be careful who you ask that because there's a lot of agents out there that will churn your account,

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move it from one annuity to another just to create another commission. First of all,

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that's illegal. They should lose their license. It's called churning and twisting in the business.

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But let's go a little bit farther backwards to say, should you? Now, there are some annuity

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types that are not transferable. These are called annuitize. Annuitization means creating payments.

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But in essence, you're ripping the knob off a water faucet. There's no liquidity. So,

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that would be immediate annuities, single premium immediate annuities, deferred income annuities,

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qualified longevity annuity contracts. Those are not transferable. You can't transfer them.

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You can transfer deferred annuities like multi-year guarantee annuities,

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fixed indexed annuities, RILAs, variable annuities. Those are securities products

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that we don't deal with because I don't want to deal with them because there's no reason to deal

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with them. Good luck. There's not enough good for me to go get my securities license again.

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But with deferred annuities, there's a rule in the IRS code, if you're so bored

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and have no life. It's Section 1035. And what that says is, in a Non-IRA account,

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non-qualified checking account, Non-IRA, you can go from one annuity to another,

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and that's a non-taxable event. It goes from one to the other, okay?

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If you have a Roth IRA, you can go from the deferred annuity inside of it, MYGA,

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indexed annuity, whatever, variable annuity, from Roth IRA to another Roth

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IRA established at the annuity company that's receiving it. Same thing with

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Traditional IRA. It will go from IRA to IRA. All of those are non-taxable events.

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So, can you move your annuity from one company to another? The answer is yes,

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and it's a non-taxable event. But let's stop right here because what I'm getting ready to

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say now is the most important part. We've established you can do that. My team can

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handle that all day long and a bag of chips. They can do that all day long,

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okay? Hundreds of applications every single week just rolling in, and they know how to do it.

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But what you need to know is just because you can transfer it doesn't mean you should transfer it.

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In the annuity industry, the receiving company has to see why you are moving it,

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and it has to be in your contractual favor. Not a hypothetical, not a theoretical,

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not a bonus. They have to see that you're upgrading your situation contractually.

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And in the application, we have to show a side-by-side comparison of where you're

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coming from to where you're going to. And that's where the games are played by the

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agents. Agents will fictitiously fill that out. Ask for the application. Ask to see a

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copy of it. A lot of times, they're playing games. They're playing games

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with getting you to this other place, this other annuity company, to make a commission.

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It happens a lot in the indexed annuity world. A lot. In other words, they'll say,

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"Well, you got these surrender charges, but if you get this upfront bonus,

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it's going to make up for this, and you can go over here." Just totally fraudulent crap.

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I've seen one out of a thousand times that actually made sense. That's not a trend.

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So, just because you can doesn't mean you should. And just because you want to doesn't mean you

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can. We had a guy the other day call. He had been sold too many indexed annuities under the

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dream scenario, and he wanted to transfer them, but he only owned them for two years. Sorry,

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buddy. You made a mistake. You bought the dream. You own the contractual realities.

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The surrender charges are too high, and not an upfront bonus in the world will make up for it.

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So, any jack wagon out there talking about upfront bonuses

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so he can flip your annuity is a charlatan and a fraud. And like I said,

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I've seen one out of a thousand cases make sense. One out of a thousand, if that.

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Now, sometimes transferring things makes sense. I'll give you an example. We had a person the

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other day, an old lady, very old, in her late 80s, and she had been sold a variable annuity

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a long time ago, the kids wanted to make sure that she wasn't going to lose any money and

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it'd be there for everybody. And what we did is we transferred it from the variable annuity to a

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MYGA, a multi-year guarantee annuity, fixed-rate annuity, the annuity industry version of a CD.

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What did we do? We stripped out three percentage points of fees on an annual basis.

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She went to a product with no fees and a guaranteed interest rate like a CD. It just

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made total sense. When you transfer like that, your cost basis transfers too.

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Another one we recently got: a guy had purchased the dream of life insurance for tax-free lifetime

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income, and he found out when he watched one of my videos that that was a loan,

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that wasn't tax-free income. And he had built up all this cash value,

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and we could transfer from the cash value to a MYGA, which is what he wanted. Okay? We can do

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that because he had been fraudulently sold, and we took him out of that and put him in a CD product.

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And at the end of a MYGA, you can transfer it into an immediate

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annuity if your goal is lifetime income. Now, you've got to say,

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"Wait a minute, Stan. I thought you said that you have to prove..." Yeah,

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we do. The MYGA company, let's just say you own XYZ MYGA, that's made up, I'm not going to mention

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company names, and we're going to transfer it to an immediate annuity, highest contractual

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guarantee we could find. We still have to get an annuitization quote from the MYGA company

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to prove that where they're going to is better. It's in your best interest for us to do that.

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I'm just telling you, that's where the games are played, that's where the fraud's played,

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and how some agents, not all, there's bad people in every industry, fill out the application.

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But by no means, should an upfront bonus be considered to transfer and take surrender

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charge penalties from your current policy? My gosh. If that agent and advisor and maybe

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fiduciary is so hard up to make income, they need to get a second job. It shouldn't be on your back.

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So, the question is, can I move my annuity to another company? Yes,

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you can. Will it be a non-taxable event? Yes, it will be. Should you? I don't know.

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Can you? I don't know. We have to see the case. We have to see the statements.

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Email me what you want me to look at, [email protected], or go to my site,

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theannuityman.com, and book a call so that we can have 30 minutes to talk about it.

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But do not allow someone to flip your annuity into another just so they can make a commission.

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And if they do, file a complaint and go after them. I hate saying that,

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but I'm seeing so much of it right now, it makes me sick.

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Are we perfect? No. But we tell the truth. And the truth is,

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the transfer has to be in your favor, not the agent's favor. That's the truth.

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Should you do it? Maybe. Let's look at it. Can you do it? Yes. Is it a non-taxable event? Yes.

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Do me a favor. Watch this video I did on lifetime income. I know it's a little off-topic,

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but it's pretty cool. I went over how artificial intelligence is going to change the game when it

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comes to lifetime income. You need to look at that because it's going to affect everyone pretty soon.

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My name is Stan The Annuity Man. I'll see you next time.