What Happens When An Annuity Owner Dies Before Annuitization? - YouTube

So, what happens when an annuity  owner dies before annuitization?  

It's a sad thought. Hi, I'm stan the annuity  man. Typically, I'm bouncing off the walls,  

I'm happy but we're talking about death. So,  I'm just going to bring it down a little bit.  

Yes, I'm america's annuity agent. Yes,  I'm licensed in all 50 states. And yes,  

I'm holding flowers, why? Because you're dead. So,  you have to find out what happens when you're dead  

to your annuity? We're going to cover that.  I will offer this. I will fly in and I will  

sing at your funeral. Acapella, I mean it would be  beautiful, I have a great voice. I really don't,  

but I'd love to do that, but I digress. And  I'm now happy and you know why I'm now happy?  

Because you're not dead yet. You're watching  the video, which is great. Can i throw...? No,  

I'm not going to throw these. I don't have  to send these. So, what happens when an  

annuity owner dies before annuitization?  We're going to find out after this music.  

So, what happens when an annuity owner dies after  annuitization? What happens if you die before the  

annuity has been fully paid? What happens if the  annuitant dies before the annuity start date?  

All of those questions and more are going to  be covered in this video. So, let's talk about  

the definition of annuitization. Annuitization,  think of when you were growing up as a kid you  

had a water faucet at the back porch or something  of your home, and you turn on the water and the  

water flows. Think about ripping the knob off that  water faucet and the water is just going to flow.  

That is in essence the visualization of  annuitization. Annuitization is an irrevocable  

lifetime income stream. So, did that annuitization  definition make sense? If not, put something in  

the comments and I'll respond. It's important to  remember with annuities, annuities are contracts.  

I mean remember that. In fact, I don't even  call them investments, I call them contracts,  

why? Because you're going to get a policy in the  mail when you buy one which is a contract. Now,  

when you set up your annuity at the time of  application, of course my team is going to  

take care of all of that from start to finish. But  one of the questions they're going to ask you is,  

"Who do you want to list as the beneficiary  of the policy if something happens to you?"  

If your Learjet hits the mountain, if your Ferrari  hits the tree, if your Bentley flips over, right?  

What happens? I don't have that. I don't have that  but what, you know? When you die, what happens to  

the money? Well, the beneficiaries have to be in  place. And you can put on as the beneficiary you  

can put a spouse, a non-spouse, you can put your  children, you could put your grandchildren, you  

could put a trust, you could put a charity. And  this is all things that you need to think about  

when you're setting up that annuity structure, is  what happens to the money when you pass away? Now,  

obviously we will walk you through all of that  answer, all the questions that you have on how to  

structure primary or secondary type beneficiaries.  But just understand that when you sign the  

paperwork for that annuity contract, we're going  to need to list the beneficiaries of the policy.  

Hey, just a thought, I mean because you might  be thinking about setting up beneficiaries,  

you might want to share this video with your  potential beneficiaries. Unless they've made  

you mad and then you don't send it to them.  But if they're still in good standing with you,  

I'd let them know about it. So, what really  happens depends on the contractual guarantees  

of that specific policy. So, single premium  immediate annuities, deferred income annuities,  

qualified longevity annuity contracts, those are  annuitization structures. So, it really comes down  

on how you have that structuring of that lifetime  income or period certain income at the time of  

application. Just remember with those products  there's a myriad of ways to set them up. And  

then let's go over to the deferred annuities like  multi-year guarantee annuities and fixed indexed  

annuities. You know, typically that's that full  cash value on debt to the beneficiaries. Remember,  

annuities are contracts. And when you die  some annuities will pay out the full value  

to your beneficiaries and some annuities will pay  out the surrender value to your beneficiaries.  

Important thing to know and that's something  that me and you need to talk about. Okay,  

so let's talk about spousal versus non-spousal  options when they're listed as beneficiaries. Now,  

if the spouse is the primary beneficiary, the sole  beneficiary of the policy, they can continue that  

policy as is. But they also have all of the other  choices that a beneficiary has when you pass away.  

So, understand that, talk to your husband and or  wife wherever that's applicable and say, "Hey,  

if I die and you are the primary beneficiary,  you get to continue the policy if you want  

to do that or you can take advantage of the  other beneficiary choices that are available."  

So, the choices for non-spousal beneficiaries are  as follows, number 1, you could take the lump sum  

death benefit, okay? Number 2, you can take  that death benefit over a 5-year time period.  

In a non-IRA, you can get a lifetime income stream  if you want to. And in an IRA, you can take that  

income stream over a 10-year time period. I know  that's a lot so let me do it again, all right? So,  

here are the 4 choices, you can take the death  benefit lump sum or you can take the death benefit  

spread out over a 5-year time period. Or in a  non-IRA setting you can take a lifetime income  

and the final choice is in an IRA setting,  you can lengthen those payments out 10 years.  

So, wasn't that fun? Talking about death. Yes, I  have new flowers for your arrangement. The good  

news is you're still alive. I'm glad you joined us  for this video. It was a lot of fun. Just remember  

the stat, 1 out of 1 of us is going to die. And  that's pretty good odds. With that being said,  

go to theannuityman.com. You got 3 things to  do there, number 1, get my books, they're free,  

I'll ship them to you. No one's going to show  up at your door, no one's going to call you.  

Number 2, use the annuity calculators, you can run  your own quotes, so you'd like fees, all kinds of  

stuff. And number 3, most importantly, schedule  a call with yours truly, Stan the Annuity Man,  

Stan the Flower Man. Schedule that call. Me  and you're going to talk one-on-one about  

your specific situation. And I will help you.  See you on the next Stan the Annuity Man video.