In this episode, The Annuity Man discussed

• The two primary functions of an annuity
• Don't time it; ladder it
• Annuities are based on life expectancy
• When life expectancy tables change against you

Key Takeaways:

• There are two primary functions for an annuity: principal protection or income for life. Never buy an annuity for market growth.
• Don't time it; try laddering instead. If you have $300,000, put $100,000 each in a three-year, four-year, and five-year plan. That way, you'll have money coming due at different intervals, hopefully attaching to rising interest rates.
• Lifetime income is primarily based on your life expectancy when you take the payment. Interest rates play a secondary role, and that's why laddering is the best strategy for squeezing yield out of annuities.
• Keep your maturity short and ladder it. Lifetime income is all about life expectancy, not interest rates. When you're squeezing annuity yields, remember that because lifetime expectancy dries the pricing train, there's a risk that the life expectancy tables will change against you in the future.

"Squeezing yield out of MYGAs really comes down to not trying to time it, not trying to pick a specific duration, and laddering those maturities." — Stan The Annuity Man.

Connect with The Annuity Man:

Website: http://theannuityman.com/

Email: [email protected]

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YouTube: https://www.youtube.com/channel/UCCXKKxvVslbeGAlEc5sra2g

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