How Do Annuities Work For Beneficiaries?

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Hi there, Stan the Annuity Man,

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America's annuity agent, licensed in all

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50 states and Puerto Rico. The question

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of the day is a good one. How do

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annuities work for beneficiaries?

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Easy for me to say. The people you want

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to give money to when you die.

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Beneficiaries. Let's talk about that

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after this.

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Okay. So, one of the fun things that I

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hear a lot is when people say, "Well,

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when you die, a nudity come and keep

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money." I mean, that's the dumbest I

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mean, that's as dumb as a box of hair,

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as they say. Um, and that's dumb. You

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can structure the annuity annuity type,

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many different types, so that when you

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die, when your lerjet hits the mountain,

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when your Ferrari hits the tree, when

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your Bentley flips over and shoots you

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out the passenger seat and you die, 100%

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of any unused money goes to the listed

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beneficiaries of the policy, and the

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evil annuity company doesn't keep a

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penny, even though they're on the hook

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to pay for lifetime income.

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Please, please, please understand that.

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Okay. Now,

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beneficiary

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choices, choosing is a unique sport

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within itself, and there's only a few of

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us out here that totally understand it.

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Now, I'm not going to go down the rabbit

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hole of that. You're going to have to go

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to my site um at theanuityman.com,

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schedule call or email me

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stantheanuityman.com

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because everyone's situation is

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different. You can't give a cart blunch

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answer for um annuity beneficiary how

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how it all works. All I can say is from

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a 30,000 foot view, you can list primary

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beneficiaries and secondary

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beneficiaries with most carriers.

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Um, and some allow tertiary, which means

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third in line. So if you know if the if

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the wife is the primary and the kids are

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the secondary and the wife dies, kids go

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up to primary. Does that make sense? And

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you can split it in percentages. You can

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have the wife is 100% beneficiary and

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then the kids 5050. Um, if you have

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three, they're 33 and a third, 33 and a

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third, 33 and a third, right? Or however

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you like them. Sometimes it's not like

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that because you don't like some of

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them. And you know, that's the

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conversation we have to have now, um,

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with multi-year guarantee annuities, um,

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which is the annuity industry version of

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a CD. And I'm just giving you some

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examples. I'm not giving you the whole

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thing because that's a whole book. Um,

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if you have your spouse as the

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beneficiary, most companies allow

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spousal continuation of the policy. So,

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let's just say you bought a five-year MA

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um, and you died in year three. your

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spouse has the ability and the choice to

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either continue the policy for the

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additional two years or take the lump

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sum. All right? If it's the not a

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spouse, it's going to be the lump sum.

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Now, we can go down the tax rabbit hole

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and do all those things as well, but I

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just want to give you a 30,000 foot view

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of how it works for beneficiaries and

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the fact that there are beneficiaries

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and the fact that those beneficiaries

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can be changed at your leisure. And I

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would encourage you to use my my staff

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at theanuityman.com. And I have the

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biggest staff in the country. They're

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all licensed. They're all under one

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roof. They're not on commission. Even

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the receptionist is licensed. They work

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as a team on your situation on your

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policies. And if you want to change

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beneficiaries or update beneficiaries,

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we can do that for you. Now, one thing I

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am going to try to clear up here. So, a

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lot of people go, "Well, I want the I

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want a lifetime income stream on me and

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my wife is the beneficiary and then she

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can get the payments." Don't work like

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that, player. Okay? If you want joint

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life income, that person has to be

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what's called a joint annuitant.

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Annuitant in English means who the

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payment's based off of. So, if they're

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just the beneficiary, they're not going

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to get the continuation of the payment.

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Now, you can structure lifetime income

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streams like with immediate annuities a

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myriad of ways. You can have it life

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with 20 years certain, life with

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installment refund, life with cash

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refund. But if you want the income

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stream to continue unin uninterrupted

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and unchanged for your spouse's life

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when you die,

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your spouse has to be a joint annuitant.

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They cannot be just the beneficiary.

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They're not going to get the lifetime

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income stream. Let me give you an

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example of of ways they could get a

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payment. Let's just say you said I I

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want a life with a 20-year certain just

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on me stand. Wife is the beneficiary.

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You die year 10. So it's life in 20. You

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die year 10. She gets 10 years of

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payments. That's all she gets. You die

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year 21, she gets nothing as a

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beneficiary. Once again, if you want

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your spouse to get lifetime income, they

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have to be a joint annuitant, not a

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beneficiary. Get a lot of questions

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about trust as being the beneficiary.

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You know, we need to make sure that your

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CPA and tax lawyers involved, estate

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planning lawyers involved, but trust can

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be a beneficiary. A trust can be a

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beneficiary of a policy. We just have to

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have the copy, front page copy of that

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trust. And and I have to be a part of

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that conversation to see if that makes

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sense. Does that make sense for you to

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do? Remember, annuities pass outside of

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probate. So, a lot of times people are

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worried about probate. I had a I had a

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person call me the other day. They had

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purchased an annuity. We had gone

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through it. They got a little scared and

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I said, "Well, what about probate?" And

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I said, "They pass outside of probate.

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We're good." Okay. They just do that.

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Legally, they do. But beneficiary

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putting you listing beneficiaries is

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something you need to think through. The

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time you don't need to think it through

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is if you say, "You know what, Stan? I

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hate everybody. I hate my kids. I hate

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my family. I hate my ex-wife. I just

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want the highest payment. I want it to

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be life only. Okay, then beneficiaries

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don't don't matter because life only is

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if the if you lit hits the mount amount

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money goes poof. But you're going to

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have to convince me why you want to do

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life only. It might be a reason that you

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love your your family. You just want the

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highest payment and you have a lot lot

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of the money that that uh can back that

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up in other things.

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But beneficiaries on annuities, you

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know, we're going to need their

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obviously their name, typically date of

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birth, you know, sometimes social

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security, but a way to get in touch with

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them if something happens to you because

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if something happens to you, we're going

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to need a death certificate from them

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and then they're in line for the

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annuities. I just had a situation. It's

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pretty good story. Um, you know, death

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is, you know, death is not a good

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strategy, hey, because you can only use

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it once. But I do get some heartwarming

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stories. I had a gentleman out of

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Minnesota and he was a hardworking guy

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and just just over time built a really

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large MIGA multi-year guarantee annuity,

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fixed rate annuity portfolio. He had

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laded them. He had a bunch of money in

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it. And his kids were his three kids

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were the beneficiaries. I think his wife

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has passed and they were the

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beneficiary. So, you know, they

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contacted me. We had a call and they

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said, "We didn't know he had accumulated

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all this. It was a lot." And I said,

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"Yeah." I said, "Yeah, you're on the

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hook for the taxes because, you know,

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he's been deferring the taxes on it in

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nonirra accounts." But it was a good

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story because I I don't think the kids

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realize that good old dad, goofy old

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dad, as they always call us, had done

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what he had done and put money away for

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them. He could not get life insurance. I

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remember the conversation because I went

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back when I heard that he passed. I went

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back in my notes and he couldn't get

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life insurance. I said, "Well, the

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legacy play here is MAS. You just put it

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in the in a MA, let it grow and compound

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tax deferred, and then your kids will

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deal with the taxes, but they're also

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going to be dealing with a huge lump

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sum." So, you know, the beneficiary of

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uh of annuities, especially deferred

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annuities, I mean, you can put that you

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can structure any way you want and

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that's a conversation that we need to

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have one on-one. You need to schedule a

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call or shoot me an email and and at

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least get some of the basic questions

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answered about that. And if we need to

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get your CPA or tax lawyer involved, we

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will because they're the only ones that

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can give real tax advice and check that

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box for you. But I would encourage you

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to go to my site, schedule that call,

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email me, download the books, run

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quotes. You can run quotes on my site

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and not have to put in your personal

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information. You can get real quotes,

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which is fantastic. One last thing above

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my head spinning the clock. I did a fun

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video on, "Hey, annuity haters,

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attention annuity haters, you already

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own an annuity." That's my stab at all

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the people that you I never buy an

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annuity stand. You already own one. I

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mean, every single person that says, I'm

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like, you already own one. No, I don't.

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Yes, you do. Well, well, I guess I do,

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but you know what I mean. No, I don't

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know what you mean. So, [laughter]

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that that video is for those people. Had

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some fun with it. You know, got to have

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some fun doing one of these a day. Got

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to keep it light and airy and jovial, as

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they say. My name is Stan the Annuity

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Man. I'll see you next time.