Single Premium Immediate Annuity Definition - YouTube

Hey, welcome back. My name is Stan the annuity man. Do not let this really nice

tracksuit get in the way of what we're going to talk about today which is the

definition of single premium immediate annuities.

And fortunately, I've written a book on that. I'm going to send that to you for

free if you hang in there for this video. So, here's what we're going to talk about.

Now fortunately, I've written an owner's manual on that topic and I'm going to send

it to you for free if you hang in there for this video. It's going to be

informative so here we go. Now, we're going to cover a lot today.

We're going to cover "what is a single premium immediate annuity? What

does it solve for?" The brief history of immediate annuities. The limitations and

the benefits because we got to cover both. Limitations on benefits because all

annuities have them. And then we're going to talk about you know, where does it fit?

How do you quote it and once again, hang in there because I'll give away the book

for free at the end of the video. Okay. So, why would you even want to own a single

premium immediate annuity? I'll tell you why. It's for lifetime income. Its income

now. It's a pension. You can't hate a pension. You can't hey Social Security

and then hate annuities, right? Because a single premium immediate annuity is all

about income now. In other words, income starting as soon as 30 days from the

policy being issued to as far out as kind of a year. So, that's a single

premium immediate annuity. And that's why you'd want to own one. So, what's the

history of immediate annuities? Pretty interesting story. It goes back to the

Roman times. The word annua in Latin... And of course, I'm not... You know,

I didn't take any courses in that as you can tell. But that word means payment. So,

that's where the word annuity comes from. Now, back in the Roman times, the dutiful

Roman soldiers who were out there laying it on the line for the man I guess. The

the Roman government came up with a way to provide a lifetime income stream for

the Roman soldiers and their families. That's the start of immediate annuity. So,

you're the Roman soldier. You're going to put together that lifetime income stream

for your family and yourself that you can never outlive. Okay. So, what

immediately solve for? Like I said, it's a pension. It's income now. But you have to

understand that immediate annuity payments are primarily based on your

life expectancy not interest rates. Interest rates play a secondary role. So,

where do the immediate annuities fit? As part of that income floor that you're

trying to generate that you have a pension; if you're so lucky, you have

dividend income, you have rental income. And then you need that single premium

immediate annuity. To fill in that gap for that money that's going to hit your

bank account every single month for the rest your,

that's where it fits. Okay, what are the benefits of immediate annuity? It's pretty

obvious. You can't outlive the money, right? So people always say, "Hey, Stan.

What's the ROI on an annuity like this?" ROI means return on investment. I don't

know that until you die. Now, when that happens, I'll come to your funeral, I'll

sing a very beautiful song with no backing and I'll work in that ROI into

the song. It'll be great. No, all kid inside. You don't know. You're

transferring the risks of the benefit of immediate annuities. The lifetime income

stream you can never outlive. If you set it up and join with your spouse, neither

of you cannot live it. Here's the good thing: When your Learjet hits the

mountain, poof! You're dead. That income stream continues uninterrupted and

unchanged for your spouse's life. So, that's a good legacy. You're looking down

from heaven hopefully or looking up, whichever one it is, right? And you saying,

"Hey, my spouse is being taken care of." That's the transfer risk nature of an

immediate annuity. Benefits, it's simple. It's easy to understand. A 9-year old

can understand it. No offense the 9-year olds. But it's just an efficient

product for lifetime income. Okay. So, what are the limitations? Everybody is trying

to sell the sizzle not the steak. So what's the steak? What's the truth about

these products that you need to know that are limitations? Because listen,

annuities are contracts, all types. So a single premium immediate annuity does

have its limitations. First of all, it's a rigid contract. There's not a lot of

liquidity. You can't call me up 2 years after you've been getting payments and

say, "Hey, Stan. Send me the money." Picture a water like a water faucet. And

you rip the knob off and the water just flows. That's an immediate annuity. Once

the income starts, hey, it's going to flow. Now, we can set it up so it's going to pay

for your life and your spouse's life or whoever and then when you're Learjet

hits the mountain, your Bentley hits the tree. Whatever money's unused goes to

the beneficiaries. But you're still transferring the risk. The limitation

also too is people say, "Well, if I put it in the immediate annuity, I'm going to

lose some growth opportunities that stock that I should've bought. I put in

the immediate annuity." Hey, hindsight is twenty-twenty, right?

You can't do that. You either like the guarantee. It either is a part of the

income floor or it's not. You can buy single premium immediate annuities that

have some liquidity provisions but once you do that, remember, annuity

companies have the big buildings for a reason.

Anytime they give something away, they lower the payment. So, when you're buying

an immediate annuity, know the limitations --It's rigid. You know, it's

it's irrevocable but it's a lifetime income stream. Okay. So, how do you

structure an immediate annuity? First thing you need to understand is that

structuring an immediate annuity is customizable. You're going to have to

specifically tell me, "Here's what I want it to do. Here's the people that are

involved, etc." Now, most people have this misunderstanding about structuring.

They'll say stuff and this is my client voice. "Stan, I buy that immediate annuity

and learjet hits the mountain money goes poof. And the evil annuity company keeps

it." Well, that's a good voice. That's only one way to structure it.

That's called life only. Now, that's the highest payment. Because you're

shouldering some of the risk but you don't have to do it that way. Most people

structure it. So there's a lifetime income stream ,okay? But when the learjet

hits the mountain, when Bentley hits the tree and you're dead, whatever unused

money is in that account goes to your beneficiaries. And the evil annuity

company doesn't keep it. So, you know, you can set up structuring choices for life.

There are also ways to do it for just a specific period of time. Some people say,

"Stan, I just need to do for 10 years. I just need a 10 year period certain

immediate annuity." Okay, we can do that. Once again, customizable. And you can

combine them. I want a lifetime income stream with a 20 year certain. Now, that

happened to me the other day? Guy said, "I want a lifetime income stream but I want

to make sure there's 20 years of payments." And here's the way I explained

it to him. I said, "Fred, here it is. It's life in 20." Life with a 20-year period

certain. Meaning you're if you live forever it's going to pay you. But let's

just say you died in year 5. What does that mean? Life in 20, you die in your

5, there's 15 more years of payments to the listed beneficiaries. It could be

life in 30, life in 15, life in 10. But the point of the matter is you can

put in that backstop of income just in case you die early in the policy. Okay. So,

how do you get a quote? That's an obvious answer. You go to Stan the annuity man.

Stan the annuity man. Go crazy, right? Stantheannuityman.com

and we will quote all carriers. Because buying as an immediate annuity is like

buying a plane ticket. I mean people say, "Well, who's your favorite immediate

annuity income?" I don't have a favorite. My favorites the highest contractual

guarantee because you own annuities for what they will do not what they might do,

right? And the will do is the contractual guarantee. So, we're going to go in there and

quote everybody. Now, understand this quotes for an immediate annuities like a

gallon of milk. It spoils every 7 to 10 days. So, every 7 to 10 days,

we have to recoat it unless you're moving forward with the paperwork and we

lock that quote in. So, it's a commodity. You have to quote them all. That's how

you get to best contractual guaranteed payment for your specific situation. Okay,

so we're just... Once again, where do immediate annuities fit in your

portfolio? It's a specific place for it. It's income floor. It's the income floor

that you want to hit your bank account that money to hit your bank account

every single month for the rest of your life. Just like social security, just like

your pension if you're so fortunate to have one. Let's talk about the book. I'm

going to send this to you for free. Oh, no! No kidding. No obligation, no cost.

And it comes to this really neat Willy- Wonka package. And yes, I will sing that

song to you at a later day. So, hang in there. But here's what you do: If you look

down below me, there's 2 things I need you to do. I need you hit the subscribe

button. Please. Because I have videos coming up all the time, every day. I know

you're saying "no way". Trust me, every day. And they're informative just like this.

Click read more right under the Stan the annuity man in description and there'll

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week later, this arrives. It'll be fantastic. Thanks for joining me.