ANNUTIES Flashcards
ANNUITIES
when clients would like a monthly income steam they can give a lump sum $ or monthly instalments to create an income stream (additional interest added for monthly payments)
Estate planning benefits
Allows annuities to by-pass the estate and no probate fee
purpose of annuity
for monthly payment purpose or investment
payout annuity
-provides guaranteed retirement income
-contract owner gives company lump-sum and they pay annuitant for as long as the owner chooses
banks
can do term annuity
insurance companies
can do TERM AND LIFE annuity
Guarantee period
if client wants a beni on their contract they can choose a guarantee period. if client dies within that period beni gets remainder $$$, if client dies AFTER that period, beni gets NO $$$
single life annuity
covers one life - monthly payments
joint and last survivor annuity
-suitable for married or common law couples
-after death, surviving spouse continues to receive monthly payments
Pension annuity/pension contracts
-despite whoever is the beni, surviving spouse gets the benefit
3 features of annuities
-creditor protection
-ability to name beni
-estate planning/bypass
Accumulation annuity
-purpose is investment growth
-has maturity period and lump-sum gets paid out after period is over
term annuity
gives payments for a set period, banks AND agents can sell this
Life annuity
gives client payments until they DIE,
ONLY agents can sell this
shortened/impaired life annuity
-can be issued if clients life expectancy is suddenly shortened due to serious diagnosis
