Best Annuities for Lifetime Income: Which Type Is Best?

All right, America. So, what are the best annuities for lifetime income? What are the best ones out there? Those are the ones you want to know about, right? Hey, I'm Stan The Annuity Man, America's annuity agent, licensed in every single state, including the one you're sitting in. By the way, think for yourself. Boy does that apply when it comes to annuities. Think for yourself. Don't let someone convince you to buy an annuity. Do your homework, get the best quotes, talk to a real professional who's been doing it for decades, not some 20-something who picks up the phone, and then decide on your terms and timeframe. So, we're going to talk about lifetime income. We're going to talk about lifetime income annuities and the different types, and we're going to talk about which one is best, the $100,000 question, but only after I hear music.

Brief History

Let me go back in time. Annuities were put on the planet in Roman times as a gift, a pension, and a lifetime income stream for the dutiful Roman soldiers and their families. Annuities have been sold in this country for a couple hundred years. I was going to say forever, but that, for me, is forever. That's a long time. And what they've been primarily sold for is lifetime income. Now, the ironic part about the annuity industry is they don't promote lifetime income. They really don't push it like they should. The word annuity should almost be Pavlovian. I should start drooling. It's Pavlov's dogs, right? You say annuities, drool, income. Income, drool, annuities. That's Pavlov's annuity theorem by The Annuity Man. That's what it should be. Annuities are the only products on the planet that provide lifetime income, period. End of story. If you're the Chester out there, "Well, Stan, Social Security provides a lifetime income stream." Yes, Chester, because it's an annuity. It's the best inflation annuity on the planet.

The Annuity Industry

"Well, my pension provides a lifetime income stream." Yes, Chester, because it's an annuity. Annuities are the only product on the planet that provides lifetime income. It's a monopoly. Think about it: If you had a business and a monopoly on that business, and you had an industry that no one else could do. Wouldn't you promote it? Wouldn't you advertise it? That'd be the only thing you advertise. Of course. But not the annuity industry.

The annuity industry is all about growth and potential, hopeful and hypothetical, and unicorns chasing the butterflies and returns out of midair. They're transfer risk contracts that provide lifetime income. There's no ROI until you die because we don't know when you're going to die. The annuity company's on the hook to pay for as long as you live, period. That's lifetime income.

The reason I wanted to pound that into the ground before we get to the best types is when you want lifetime income in addition to your Social Security, in addition to your pension, if you're so fortunate to have one, annuities are the only game in town for lifetime income. And don't hit me with some, "Well, I've got a 30-year muni." Give me a break. I'm talking about lifetime income transfer risk. You're never going to outlive it. You know it's going to be there. And if you set it up joint with your spouse or partner and you die, you know that money's coming in uninterrupted and unchanged for their life. And you can structurally and contractually put the policy together so that any unused money goes to your family, not the evil annuity company. So, which is the best annuity? I hate to tell you this. There is no best annuity. And if anyone says they have it, they're lying. I have to know something from you. I have to know your specifics before figuring out the type of annuity you need. Then, once we figure out the type, we go to http://theannuityman.com , use our proprietary calculators and quote all carriers. Then, we find the best company that provides the highest contractual guarantee for your specific situation.

The Two Questions

It's really that simple. So, what are the two questions? What do you want the money to contractually do and when do you want those contractual guarantees to start? It's really that simple. I mean, I came up with two questions. That's like the theory of what Einstein's thing was. Anyway, the theory of relativity. This is the theory of longevity. I just made that up for you—the theory of longevity. Longevity risk is the fear of outliving your money. The fear of outliving your money, annuity. So, with those two questions answered, I can then go and quote the specific annuity type. Let's get, for example, what do you want the money to contractually do? I want lifetime income. Okay, second question. When do you want those contractual guarantees to start? Immediately. Okay, Single Premium Immediate Annuity is your choice. That's the only choice. There's no other choice.

So, we go to the annuity calculator at http://theannuityman.com . We have a SPIA calculator there, a Single Premium Immediate Annuity, SPIA, and we quote all carriers for the highest contractual guarantee. Now, we need to have that conversation after that to determine the Claims Paying Ability, if that's the right company, and what type of backstop you want to put into it. Do you want a cash refund, installment refund, or period certain? There are 30+ ways to design these. So, don't say, "Well, I'm just going to buy an annuity." No, you need to talk with me before you buy that so we can ensure you're getting what you want for you and your family. It's that important. Now, let's just go back to those two questions. What do you want the money to contractually? I want income to start at a future date, say 10 years from now. Okay, and those are the two questions. I answered both questions at the same time, but okay, so what do you want the money to contractually do? Income. When do you want to start? 10 years from now. Now we're down to two products: Deferred Income Annuities, and Income Riders attached to Deferred Annuities, like an Indexed Annuity or Variable. Quote them all. Let's find out who has the highest contractual guarantee. And then we go into a conversation looking at those numbers and saying, "Okay, here's the benefits and limitations of a Deferred Income Annuity. Here are the benefits and limitations of an Income Rider." And then you make the decision, an informed decision, on which one is best for you. So, getting back to that question, if you said, "What's the best annuity for income?" I can tell you, but I can't realistically until you give me some information on what you're trying to achieve.

Example

I got a call the other day, and he is not a client yet, but hopefully, he will be. His comment was that the agent advisor who talked to him said they had the best annuity. He had found the best annuity for this gentleman. I said, "That's impossible," because he's only shown him one carrier. Number one, when you quote annuities, I don't care what type, you need to see five different carriers. At least five different carriers. Okay, if you want to say, "Well, that's crazy." Okay, three. Three to five or more. Typically, when we run an Immediate Annuity quote, we're showing 8, 10, and 12 carriers, ranking them from the top contractual guarantee down. These are commodity products, meaning that no one is better than the other. Which in this case, in this blog, you say, which is the best? There's not one that's best. You have to drill down on what you're trying to achieve and then quote all carriers.

Annuity Quotes

Annuity quotes are like a gallon of milk. They expire every seven to ten days. A guy called me the other day, really smart guy. We had quoted him these Immediate Annuities. He had asked for specimen policies, which we sent to him, which we'll do for you, too, if you want to see the specimen policy before you even sign the paperwork. So, we sent him all that. Two weeks later, he called me and said, "I'm ready to move forward." And by the way, if you become a client of ours, that's how it works. You say, "Hey, I'm ready to go." And there's no high-pitch, high-pressure sales pitch thing going on. The bottom line to all this is there's no best annuity. The best annuity is the one that provides the highest contractual guarantee for your specific situation. Now, there's a lot more that needs to go into it than that. You and my team need to talk about the structuring of it, customization, and the customized strategy that I have come up with over my decades in the business that might fit for you. But we don't know that until we talk.

One of the things about our calculators on The Annuity Man is that when you go to the site and quote lifetime income products, you can get quotes. You can get the bare bones basics and other sites, you can get the bare bones basics. But what sets us apart is my decades of experience. I've written seven books on the subject. I get it. I understand how it works and I understand how to work contracts and play them off of each other contractually to provide the highest contractual guarantee for your situation. And we can only get to that if we talk. So, I encourage you to do that. There's no obligation or cost at all. But remember, with lifetime income stream annuities, regardless of the type, the income is a combination of return of principal plus interest. I don't care what type. All right? And that payment is based on your life expectancy at the time you take the payment. Interest rates play a secondary role. That's just a fact. If you're basing everything on interest rates, you need to come off that. It's about life expectancy. Because, in essence, you're making a bet with the life insurance company. You're saying, "I think I'm going to live longer than you think, you, the annuity carrier, think I'm going to live. And if I do that, you, the annuity carrier, will pay for the rest of my life, regardless of how long that is." And think about this for a second. People say, "Well, I have to live to age X to get all my money back because it's money back with interest. Think of it another way. What if there's a medical breakthrough? What if you live for longer than your grandmother or grandfather, and you have people in your family with longevity? What if you live forever? Don't you want a lifetime income stream hitting? By the way, do you ask that same question with Social Security? No, you don't. All you care about is that income stream hitting your bank account every single month, regardless of how long you live. The same focus should be on annuities. You should only care about the money hitting your bank account every single month, regardless of how long you live.

The excellent part about annuities, though, is you can structure them so that the evil annuity company will never keep a penny, regardless of the circumstance. Most people don't believe that, but it is accurate, and that's the reason that we need to connect.

Thank you for joining me today. Get my books, go to The Annuity Man, and use my calculators. I have a podcast called Fun With Annuities that comes out every other week. That's educational, and that's typically anywhere from 15 to 20 minutes long, and I talk about these strategies, and go a little bit more in-depth. I write a blog weekly as well. Listen, I'm educating. I'm the number one agent for a reason. I want you to understand what you're buying. I want you to understand what you're getting ready to sign. There's never an urgency to buy an annuity. The only urgency is to fully understand what you're buying. And with that, I'll see you on the following Stan The Annuity Man blog.

Never forget to live in reality, not the dream, with annuities and contractual guarantees! You can use our calculators, get all six of my books for free, and most importantly book a call with me so we can discuss what works best for your specific situation