Lovingly Handcuffing Inheritances Using Annuities: Shootin’ It Straight With Stan

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Welcome to Shooting Straight with Stan.

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I'm your host, Stan the Annuity Man,

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America's annuity agent licensed in all

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50 states. This topic comes from a

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client or a prospect or somebody that

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got my newsletter and there's a place

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where you can send me an email and um

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have me address a topic. And the topic

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that David Z wanted done. Thank you,

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David Z. I'm not going to give you last

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name because people will track you down.

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Um lovingly handcuffing inheritances.

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You know, he's heard me talk about

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lovingly handcuffing beneficiaries,

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lovingly handcuffing inheritance. This

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is kind of the same thing. A lot of you

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out there have worked hard, scrimp,

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saved, built up a very nice nest egg,

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and you're going, "Okay, clock's

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ticking." As we all know, you know, it's

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uh it's going to end one of these days,

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right? Your larger jet's going to hit

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the mountain, your Ferrari's going to

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hit the tree, your tractor's going to,

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you know, tumble over the the side of

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the thing. you're you're going to jump

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off a cliff and your parachute won't

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open. However you want to end it, what

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do you do with that inheritance? Do you

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give it to them in a lump sum so they

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can buy a Lamborghini with cash and then

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helicopter into your funeral like my

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youngest daughter would want to do or my

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actually my oldest daughter too. Um, or

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do you set something up so that you save

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them from themselves? I mean, we all

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have children that they all come out

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differently. Nod your head. They all and

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they all come out and that personality

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is intact day one. Nod your head. And

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some of them are go-getters and some of

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them are wondering ambiguities, right?

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They're just kind of wondering around

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and complaining about life while living

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under the capitalistic umbrella that you

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provide. Hello. [laughter] Okay. So,

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what do you do? You know, what do you

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do? And I I get calls all the time. I

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got a call from the other guy the other

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day and he wanted to buy an income

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stream for his son. And my comment and

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question is, do you trust him not to

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just cash it in and get the lump sum?

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And he goes, "No, he's he's good. He's

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not going to do that." Because we can

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set it up to where you're the owner.

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They're the annuitant, meaning they

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can't get to they can't call about the

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policy and get the money out. They're

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going to get the payments. We can

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structure a myri ways. And that's one of

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the ways that we do it. But if you don't

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want to give your money away early, um

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for instance, for me, um my parents hard

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workers, they didn't really have that

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much money. But you know, my mom's still

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alive, but they, you know, they didn't

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have the ability to give money away

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early when I actually needed it when I

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was first married. Married 37 years ago,

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God bless Christine. Um what a martyr.

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But the point is, you might want to make

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a decision. Do you want to give it away

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early and and have your kids utilize it

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when they really need it when they're

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first starting out? You know, I've made

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that choice. That's my choice. Um, do I

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have something set up that's triggered

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upon my death? Yes. But but a lot of

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what I what I've built up, I'm giving

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away to my kids now so that they can

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utilize it and they don't have to live

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and scrimp and save like uh like I did.

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And a lot of you are saying, Stan, you

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know, it's good for them to pull

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themselves by the bootstraps. It's good

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for them to struggle. I don't want my

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kids or grandkids to struggle. If that

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makes me a bad dad or granddad, then I'm

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a bad dad or granddad. I just don't want

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them to have to go through what I went

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through um because it's hard. So, you

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know, handcuffing your beneficiaries to

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me is instead of the lump sum creating a

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lifetime income stream for them. Yes,

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they will hate you for the lump sum that

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they're not getting, but they will love

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you every month as that's hitting their

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bank account. So, what I would advise

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you to do is meet with your estate

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planning lawyer. If you don't have one,

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get one. And you can set up a trust that

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says when I die, Johnny and Janette, my

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two, my son and my daughter, they get a

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lifetime income stream, an immediate

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annuity, a single premium immediate

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annuity is purchased for them at the

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time of my death or at the time of my

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wife's death for them to get a lifetime

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income stream. Now, understand that we

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don't know what that payment will be

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until you die because at that point in

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time, the lifetime income stream will be

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based on your child's life expectancy at

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the time that payment starts. But you

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can set it up with your trust attorney,

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that estate planning attorney, that

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says, "Johnny and Johnette, I want to

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both get $3,000 a month." Choosing

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something $3,000 a month for the rest of

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their life. Or you can say, "Johnny and

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Janette will both get $400,000 each."

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Making that up. so that they can go, but

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they have to

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trust dictates they have to buy a single

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premium immediate annuity for lifetime

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income. That's lovingly handcuffing the

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beneficiaries. Yes, they're cussing as

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they're driving to the your funeral, but

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three or four years from now, they'll be

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like, "Yeah, that's pretty cool that I

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got this lifetime income stream." I've

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done that for my daughters. My daughters

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when I die, I know it's going to be sad.

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I know. I know. They're going they're

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going to probably be upset for a day and

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then they're going to realize that

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there's a lifetime income stream or

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multiple lifetime income streams in

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place for them because there's just a

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small part of me that thinks that social

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security might not be around then. Or if

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it is, it's in a different form. Or if

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it is, they have classified me and my

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family as the evil rich. The evil rich

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that it's not fair. They got that much

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money. forgetting the fact that I've

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killed myself to accumulate it over the

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last 40 years. Okay, you might fall into

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that with 37 trillion in debt. That's

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going to happen. I mean, that eventually

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they're going to have to means test all

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of this. Um, and I I'm I'm including

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Roth IAS. I hope that doesn't happen,

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but definitely social security. I think

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it's going to be really heavily means

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tested going forward. Um, so but but

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when you lovingly bene you lovingly

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handcuff your beneficiaries, you know, a

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lot of us have life insurance. I have

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huge amounts of life insurance. I

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believe in it. Level term, none of the

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fancy stuff. Level term, buy the most

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death benefit you can for the least

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amount of money. Hello. Uh, I know that

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agents out there that sell the fancy um,

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you know, index universal life is

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yelling at the screen, I'm right, you're

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wrong. Um, I mean, that's a lumpsum

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tax-free benefit, but I don't really

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want my daughters, no offense to them,

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to get a lump sum. So, there there is a

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trust in place when I die, immediate

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annuities will be purchased for them at

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the time of my death for the rest of

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their lives. And if they're married, one

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of them is, then they have the choice,

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their choice to set it up joint life.

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And and the estate planning lawyer knows

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that as well. Hopefully, my daughters

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will buy their annuities from the

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annuity man. Wouldn't that be a twist of

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fate if they went to one of somebody

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else? But that's okay if they do. I I I

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I want it in place. But to answer David

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Z's question, inheritances,

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especially in cash form, you can set it

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up to make it a payment form for as long

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as they are breathing. And you can also

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structure it and you can tell the the

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lawyer to structure it so that if they

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die early, 100% of any unused money goes

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back to the family. We can structure

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that. we can transfer the risk to the

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annuity company to pay, but we can also

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make sure that not a penny will be kept

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by the annuity company. Okay, so that

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answers David Z's question. If you want

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to go to theanuityman.com, schedule a

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call. We can help you with these

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situations and work handinhand with your

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CPA or tax lawyer or estate planning

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lawyer to put this in place. But I also

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encourage you to think about, you know,

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doing the gifting rules and and maybe

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doing something significant now while

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they're alive if they can handle it. Um,

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and I'm starting to do that as well. You

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know, I'm 61 at the time of this taping.

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I'm a grandfather. Thank goodness for

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that. Um, that's cool. And so I'm

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starting, you know, you're kind of

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forced at this age to start thinking

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like that. So you I'm thinking about my

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grandson. I'm thinking about, you know,

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my daughters and their families. That's

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kind of where I'm at at this point. So,

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um, hope this helped. That's Shooting is

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Straight with Stan. My name is Stan the

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Annuity Man.