Flexible Annuity Start Dates Explained

0:00
Welcome to Shooting it Straight with

0:01
Stan. I'm your host Stan the Annuity

0:03
Man, America's annuity agent, licensed

0:05
in all 50 states, glass, half full, dog

0:10
on it.

0:11
Today's topic is annuities can have

0:15
flexible income start dates. Annuities

0:19
can have flexible income start dates. A

0:21
lot of people out there when they talk

0:23
about annuities, they think there's only

0:24
one. I want I want to buy annuity

0:27
because annuity company keeps money when

0:29
I die. That's one of 40 ways to

0:33
structure at Chester. Okay. Or

0:34
Chesterette out there. These are

0:37
customizable

0:38
commodity products and we represent all

0:40
carriers at the annuity man. Pretty much

0:42
all carriers, the ones that we want,

0:44
which is a lot of them. And you can run

0:46
quotes 247365 at theanuityman.com using

0:50
our proprietary calculators that mah

0:53
that's French for me spent a ton of

0:55
money developing and paying for and

0:57
continue to pay for because I want you

0:59
to be able to run quotes and see the

1:02
numbers on your terms and your time

1:04
frame. Now when it comes to lifetime

1:06
income there's primarily four products

1:10
for lifetime incomes. single premium

1:12
immediate annuity spas, deferred income

1:14
annuities, DAS, qualified longevity

1:17
annuity contracts, QAX, and income

1:20
writers that can be attached to variable

1:23
annuities and index annuities. We don't

1:25
sell variable annuities because we don't

1:26
sell anything that has the potential to

1:27
go down in value. And more importantly,

1:30
the income writers that are attached to

1:32
variable annuities are are typically and

1:34
historically not competitive to the ones

1:37
that are attached to index annuities.

1:39
We're not a big fan of the index annuity

1:41
upside bonus upfront bonus upside no

1:44
downside all that nonsense. We use index

1:47
annuities as a as a efficient delivery

1:50
system for that income writer

1:52
contractual guarantees because our

1:54
saying is you own an annuity for what it

1:56
will do not what what it might do. We

1:57
never sell the you know the might do.

1:59
It's always the will do the contractual

2:01
guarantees of the policy. Those are the

2:03
primary four types to do lifetime

2:06
income. Now, there's a fifth, multi-year

2:09
guarantee annuities, which is the

2:10
annuity industry version of a CD, but

2:12
that's not lifetime income. You could

2:13
just peel off the interest like you

2:15
would a CD or a bond coupon. So, that's

2:17
MAS, but I don't put that in the

2:19
lifetime income category. Lifetime

2:21
income are SPSDS, QAX, and income

2:24
writers because you're you're

2:26
transferring the risk to the life

2:28
insurance company that's issuing the

2:29
annuity to pay for you as long as you

2:32
are breathing. As long as you're on a

2:33
ventilator, as long as you're breathing

2:35
and breathing in oxygen, it's going to

2:37
pay. So there's no way to calculate the

2:40
return on investment till you die.

2:42
Period. There's an R O no

2:47
R O I until you die. But with a lot of

2:53
you out there, when we ask the two

2:54
questions, and these are the two

2:56
questions we ask everybody. When I say

2:57
we, I mean the annuity man team. If you

3:00
go to theanuityman.com,

3:01
I have a team of really, really smart

3:04
people, smarter than me. You might get

3:05
me on the phone, you might not get me on

3:07
the phone, but if you don't, they're

3:08
going to ask you two questions. What do

3:10
you want the money to contractually do?

3:13
And when do you want those contractual

3:14
guarantees to start? Now, the the

3:17
soonest that you can have income start

3:19
with is a typically an immediate annuity

3:22
30 days from the policy issue date, but

3:25
you can defer out as far as 10, 15, 20

3:28
years if you want to. All right, so

3:31
let's kind of break all of these down

3:34
with the the the immediate annuities,

3:36
SPAS, deferred income annuities, DAS,

3:38
and qualified longevity annuity

3:40
contracts, QAX. Those are what I call

3:43
annuitized products. Um, all lifetime

3:46
income is combination of return of

3:48
principal plus interest. Uh, but these

3:51
are kind of rip the knob off the water

3:52
faucet. Once you once you start the

3:54
income, it's coming, baby. It's going to

3:56
hit your bank account as long as you're

3:58
breathing. Now, you can say, "But wait a

4:00
minute, Stan. I answered the two

4:01
questions. What do you want the money to

4:02
contractually do? I want lifetime income

4:04
for me and the spouse or joint life, and

4:06
I want it to start five years from now.

4:08
That's what my projections and

4:09
spreadsheets and check boxes say. but it

4:12
might be six years or it might be four

4:14
years or it might be seven years. Then

4:16
we're going to structure things

4:19
contractually or point you to a product

4:21
type that allows you to change the

4:24
income start date. So you're not fully

4:27
locked in if you tell us that it, you

4:30
know, you might need to have you might

4:32
want the possibility and the potential

4:34
to change that start date. Now

4:38
let's just look at that comment for what

4:40
it is. Lifetime income is primarily

4:44
based on life expectancy. Your life

4:47
expectancy or if it's joint life

4:48
expecties

4:50
plural at the time you start the

4:52
payment. Interest rates play a secondary

4:54
role. Interest rates play a secondary

4:56
role on the pricing. Just need you to

4:58
know that. So if you decide we go into

5:02
the the contract, you you decide to use

5:04
the annuity man. We shopped all

5:05
carriers. to find the highest

5:06
contractual guarantee and

5:09
the plan from the start because we have

5:11
to have a plan in place is you're going

5:13
to turn on income in five years. Okay?

5:16
Now, if you get to year four and we're

5:19
going to, you know, we're going to be in

5:20
contact with you, not bugging you, but

5:22
just saying, "Hey, how you doing?

5:23
Anything changed?" etc. on the yearly

5:25
type call email. And you can always call

5:28
us. I mean, we're always available. You

5:29
can always book a call. Um, you might

5:31
say, "You know what? We need to start it

5:33
sooner." If you start it sooner, the

5:34
payments will be lower because you are

5:36
younger, which means there's more

5:38
projected payments because your life

5:40
expectancy is longer, which means those

5:42
payments will be lower. The reverse is

5:45
true. Let's just say you get to year

5:46
five and we say, "Okay, you ready to

5:47
turn the income stream on?" You say,

5:49
"No, let's defer it for another year or

5:51
two." Okay, let's you say, "No, let's

5:53
let's turn on at year seven." That means

5:56
the payments will be higher. Why?

5:57
because there's less projected payments

5:59
because there's less life expectancy

6:01
which means the payments will be higher.

6:04
It's really that simple. Okay. Now, with

6:06
the vast majority of what's called

6:08
income writers, again, those are

6:09
attached to either variable annuities or

6:11
indexed annuities,

6:13
most vast majority, I can't say all

6:15
because the annuity industry is not that

6:17
uniform, but but most the vast majority

6:20
um you know, you can change the start

6:23
date of that income writer. Um, and the

6:26
in and the annuity company, think about

6:27
the life insurance company that's

6:28
issuing the annuity. They don't care.

6:32
Okay, we'll hold on to the money longer

6:33
or we'll turn on the income sooner and

6:35
they're going to give you your money

6:37
back with interest as long as you are

6:39
breathing joint life as long as one of

6:40
you is breathing. And even if the

6:42
account goes to zero, they're on the

6:43
hook to pay, which is the value

6:44
proposition. So, it's no skin off their

6:47
back. You just have to use us and my

6:48
team as your administrative arm to do

6:51
exactly what you want. Whether it's to

6:53
start the income sooner, start the

6:54
income later, or start the income right

6:56
on the dot from when you um first

6:59
scheduled that uh or attached that

7:02
income writer um to the policy. So,

7:06
income writers allow you to change the

7:09
start date. Now when we talk about

7:11
single premium im immediate annuities,

7:14
deferred income annuities and qualified

7:16
longevity annuity contracts, let me give

7:18
you the genealogy of those products. It

7:20
all starts with single premium immediate

7:22
annuities that were developed in the

7:23
Roman times for the dutiful Roman

7:24
soldiers and their families who are

7:26
laying it on the line, laying it on the

7:28
line for the empire. And the empire

7:30
said, you know what, let's give them a

7:32
pension, an annua, which means payment,

7:35
annual annuity. See the correlation? And

7:38
it's a lifetime income stream as long as

7:39
one somebody in the family was

7:40
breathing. That's the genesis. That's

7:42
where it all started with single premium

7:44
immediate annuities. Okay. Um deferred

7:48
income annuities are in essence single

7:51
premium immediate annuities that defer

7:53
past a year. I mean it magically turns

7:57
into that. I mean really the same thing.

8:00
No moving parts, no annual fees, no

8:02
market attachments, a straight transfer

8:03
of risk pension that you can customize

8:06
the structure of. And then qualified

8:08
longevity annuity contracts are DAS,

8:12
deferred income annuities that can be

8:13
used in qualified accounts, i.e.

8:15
qualified longevity annuity contracts.

8:17
So all the people never buy an annuity

8:19
inside of an IRA. You think not because

8:23
there's such a thing as called a

8:24
qualified longevity annuity contract

8:26
that was put on the planet by the and

8:27
developed by the IRS. our friends at the

8:29
IRS and the Department of the Treasury

8:32
for use in IRA qualified type accounts

8:36
for lifetime income because social

8:37
security was never put on the planet to

8:40
be the sole annuity and yes it is the

8:42
best inflation annuity on the planet but

8:43
the sole income source for people they

8:45
want people to use

8:48
to enhance that income floor that

8:50
they're building so we have spas das and

8:53
qlax that are pretty much the same

8:56
structure no moving parts no market

8:58
attached ments, no annual fees, nothing

9:00
complex about that. If Warren Buffett

9:03
bought annuities, these are the ones

9:04
he'd buy, okay? Because they're simple.

9:06
He can explain it to a nine-year-old. No

9:08
offense to 9year-olds.

9:10
But with a lot of these companies, if

9:13
you do it life only, meaning you're a

9:14
misenthrop, you hate your beneficiaries,

9:16
you don't have beneficiaries, you want

9:18
the highest payment. A lot of these

9:20
companies with the life only will not

9:22
allow you to change the start date. But

9:24
you can change the start date if it has

9:26
a cash refund attached to it or an

9:28
installment refund attached to the life

9:30
contingency or period certain attached

9:32
to it. They do allow that. So we're

9:35
going to ask you the question if you say

9:38
I want life only. I want the highest

9:40
payment. I hate my family. I don't have

9:42
any benefit rates. Listen to what I'm

9:44
saying. We'll still say, but you do

9:47
understand that you're going to defer it

9:50
for three years or a year or two year,

9:52
whatever you come up with with the two

9:53
questions. What do you want the money to

9:54
contractually do and when you want those

9:56
contractual guarantees to start? We're

9:58
going to make sure you understand that

9:59
with the carrier that you chose, if it's

10:01
life only, you're locked in. Okay? You

10:04
say, "Well, I'm not sure I want to be

10:05
locked in like that. I kind of want some

10:07
flexibility. You know what I'm saying? I

10:08
can't really reach over and touch my

10:10
toes anymore, but I want flexibility

10:11
with my income stream." You know what

10:12
I'm saying? and we go, "Okay, great.

10:15
Then let's do life with installment

10:16
refund or life with cash refund or life

10:19
with a period certain." We can explain

10:21
all those to you to make sure that you

10:24
have the flexibility to change your mind

10:26
because what's going to happen is when

10:28
you buy a lifetime income stream that

10:30
you're deferring, okay?

10:33
We're going to be in touch with you

10:34
about 90 days before that income stream

10:36
starts. So, give you an example. Let's

10:37
just say you bought a deferred income

10:39
annuity life with cash refund starting

10:41
in three years. We're going to be in

10:43
touch with you about 90 days before that

10:45
start date to say, "Hey, Chester, you

10:46
still want to turn on that income

10:48
stream." You say, "Yep, lock and load."

10:49
Then what we're going to do is verify

10:51
the bank account that the money's going

10:53
to hit. And it's going to it's going to

10:54
be like turnkey going to hit your bank

10:56
account. But if you say, "No, let's just

10:58
let's put that thing off for a while. I

11:00
came in with some money. I hit the, you

11:02
know, I hit the lottery the other day."

11:04
Whatever. Then we can push it out. And

11:07
remember, the older you are, the higher

11:08
the payment. The younger you are, the

11:10
lower the payment. It's really that

11:11
simple. But what I want to take want you

11:13
to take away from this phenomenally

11:15
presented shooting it straight with

11:17
Stan. Can we nod our head in unison?

11:21
Is that

11:23
you can change the start date of a

11:26
lifetime income stream that you have

11:28
planned to start in the future. You can

11:30
change it if structured properly at the

11:33
start. Which is why you need us

11:35
standuity man theanuityman.com. and my

11:38
team understands how to do that so you

11:42
can get to that fork in the road moment.

11:45
It's an income fork in the road moment.

11:47
And you pick up the income fork and

11:49
you're you have the ability to pivot.

11:52
You can pivot to turn it on sooner. You

11:54
can pivot to turn it on later, but you

11:56
have the ability to pivot. How about

12:00
that, man? I'm just I'm rolling. I'm

12:03
rolling. I'm like I'm like butter. I'm

12:05
on a roll as they say. So that's it.

12:09
Annuity lifetime income. Remember

12:11
transfer of risk annuity software four

12:14
things. Principal protection income for

12:16
life legacy and long-term care. The

12:17
acronym is pill. We're talking about the

12:19
I and pill. Income for life. That income

12:22
for life transfer risk strategy with

12:24
annuities. Typically four primary types

12:27
SPDS QAX and income writers. We can

12:30
structure it so that you have the

12:32
ability to pivot and change that income

12:35
start date. My name is Stan the annuity

12:37
man. I am America's annuity agent, dog

12:40
gone it. And I am licensed in all 50

12:42
states and pay those fees every year.

12:45
I'm a good citizen. And that's it. We'll

12:48
see you next time.