What Is The Difference Between Annuity Due And Ordinary Annuity?

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What is the difference between annuity due and an ordinary annuity? Hi there,

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my name is Stan the Annuity Man, America's annuity agent,

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licensed in all 50 states and the pioneer of CGO, contractual guarantees only. That's all

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that we look at. We're going to go through this, which is kind of a weird, funky,

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not brought up a lot topic, but you might want to know about it. And of course, the Annuity Man,

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America's annuity agent, I do know about it, but we're going to talk about it after this.

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So, first of all, annuity due. That's just not a phrase that I would say 90% of agents don't even

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know what that is. Of course, I do because I live and breathe annuities. But annuity due,

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we're going to talk about that. Ordinary annuity, I think what that question is referring to,

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is an immediate annuity, a lifetime income annuity. So the granddaddy of all annuities

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is the single premium immediate annuity. That acronym is called SPIA, S-P-I-A. It's been sold

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in this country for hundreds and hundreds of years. It can be traced back to the Roman times

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of all places. But a single premium immediate annuity is a pension. It's a transfer of risk.

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You're transferring the risk to the life insurance company issuing the immediate annuity to solve for

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your longevity risk, meaning how long you're going to live. It's going to pay for as long

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as you are breathing. If you set it up joint with the spouse, as long as one of you is breathing,

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and we can structure it so that 100% of any unused money will go to your list of beneficiaries of

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the policy. The evil annuity company will never keep a penny. Typically, an immediate annuity,

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the earliest that you can turn on that income is 30 days from the policy being issued.

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Annuity due. You're saying, "What is that, Stan the Annuity Man?" And annuity due,

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the true definition is that income starts, like, immediately, like now, annuity due.

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I'm going to tell you that I have never in my three decades been asked by anyone

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for an annuity due quote, okay? But if there's anyone that could get one,

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I guess it's me. But I don't see any need for it, and I don't see a lot of carriers

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letting me know. America's annuity agent, I represent all carriers. I haven't been — you know,

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the internal guys that want me to sell more of whatever they have — they never call me up and say,

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"Hey, we got this really good annuity due." No, I never have had that. In fact, I'm not even

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sure if I went out and got quotes, how many quotes I could get from carriers with that.

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But I wanted to address it because it does come up, you know, when people go down the rabbit hole,

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they run into what's called annuity due, and that's just income starting now,

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like immediately. But for me, in our world, that's immediate annuities. And

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immediate annuities allow you to shop a bunch of A+ carriers or better. Okay?

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A bunch of them. So that we can find the highest contractual guarantee for your specific situation.

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I think I'm not going to give annuity due its due because no one's really asking for it and

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it's really not available. It just comes up in this internet world that I dominate,

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and I thought I'd just address it just because if you want to ask about it,

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we can ask about it. I could lob a few calls into carriers and they'd be like,

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"No, we don't do that." I guarantee that's what they're going to tell me.

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And you're better off, because the annuity due is such a small world, if it's a world at all,

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you're better off shopping a bunch of carriers for the highest contractual guarantee. Because

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lifetime income is primarily based on your life expectancy at the time you take the payment,

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or life expectancies if it's joint. Interest rates play a minor role, secondary role. So don't go out

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there, "I'm waiting for the Fed." With lifetime income, you're kidding yourself. You

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don't understand how it works. How it works is life expectancy drives the train.

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Now, the pricing of single premium immediate annuities is when — think about age tranches.

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Just think about when you built your portfolio, you had, you know, small cap, midcap, value,

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large cap, international. Let's just say that's what you have. With life insurance companies,

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their portfolio is 60 to 65, 65 to 70, 70 to 75, 75 to 80. That's their tranches. If they

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need to fill the tranche — if the actuaries come out of the closet and say, the figurative closet,

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coming out of the thing — and they say we need more 70 to 75 year olds and you're 70 to 75,

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then that quote's going to be higher in order to attract you. If they are full,

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then they aren't going to have the best contractual guaranteed quote.

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That is the reason that you need to shop all carriers. We've set up a consumer

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site that you can shop all carriers, and if you want to talk to somebody,

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you can. You can schedule a free consultation call, or you can buy it right then. You can

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just hit the buy now button and you can buy it right then. But you're shopping all carriers and

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knowing that immediate annuity quotes are like a gallon of milk. They expire every 7 to 10 days.

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We do lock that quote in for you if you find one you like with a carrier that you like and that

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we sign off on and say, "Yeah, that's a good idea." But that's the reason you got to shop

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all carriers because they all change. Like I had a guy call me up the other day and said,

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"Hey, Stan the Annuity Man, I want to get that quote from — I'm not going to mention the carrier's

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name XYZ company, A++ company. And I ran it about 90 days ago. I want that quote."

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And I went, I'm sorry, player, that's not the way it works. Remember they expire every 7 to

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10 days. They're always changing because they're always filling those tranches of life expectancy.

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So, you know, we can lock that in for you, but you can't run it 90 days ago and then say,

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"I want that quote." It does not exist. And it does not really exist until we

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lock it in on the carrier's paper. My team can handle that for you and take care of

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that for you. I have a really good staff. I have a policy delivery and applications

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team that just does that. They make sure the policies go through. They make sure

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transfers go through. They make sure we lock in the rates and lock in the products that you want.

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But when you're looking for lifetime income, go to my site. If you need income to start immediately,

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that's a single premium immediate annuity. That is not an annuity due. Okay? It's just that's a

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unicorn. So single premium immediate annuity. If you want income to start at a future date,

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that's deferred income annuities or qualified longevity annuity contracts

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or income riders. Those are the four product types that provide

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lifetime income that have numerous carriers that quote those strategies.

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And you want numerous carriers. You want it because annuities are commodity products.

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There's not one that's better than the other. The one that's best — if you call me and say,

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"I want the best annuity" — it's the one that provides the highest

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contractual guarantee for your specific situation.

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Okay? So really the annuity due versus ordinary annuity, really what that means,

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annuity due versus single premium immediate annuity. Single premium immediate annuity,

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you're going to get a bunch of carriers, the top carriers in the country, that's

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going to be bidding on your business and offering a contractual guarantee quote to sway you to them.

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And so you can lock that in. I would go to my site as well to

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download my free annuity owners manuals on SPIAs. I've written — it's about 60,

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70 pages — goes through it. I've also done a ton of videos on them as well.

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So do me a favor, you know, click the subscribe button, leave comments. If you want to email me,

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[email protected]. I do read all my emails. The other day we sent out a

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newsletter and it was to like 20,000 people. I don't know. It was a big number. And

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I got like 480 emails or something, but I got to them all. So, you know,

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if you want to shoot me an email, I will respond as soon as I get to them.

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One last thing. Above me is a box. I want you to click that link. It explains the process,

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how the process works if you want to become a client, if you want to lock in a quote,

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how the application process works from start to finish. Do that and

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I'll see you next time. My name is Stan the Annuity Man, America's annuity agent.