With a Lifetime Income Annuity,* you can create a legacy that spans several generations.
"I Remember My Grandfather"
|Grandfather moves $100,000 to create an annual income of $5,231||When grandfather passes away, granddaughter then receives an annual lifetime income of $5,231||Granddaughter gets married and has a child of her own||When granddaughter passes away, great-grand daughter then receives $50,000, half of her great-grandfather's original premium|
A 70-year old man wants to leave a legacy to her granddaughter. He takes $100,000 sitting in another investment and purchases a Joint Lifetime Income Annuity with 50% Death Benefit.** His 5-year-old granddaughter is the joint annuitant.
The annuity pays the grandfather $5,231 each year for as long as he lives. When the grandfather dies, the policy continues to pay the granddaughter $5,231 a year for the rest of her life.
When the granddaughter dies, the policy pays $50,000 (50% of the original premium) to her beneficiary—in this case, her daughter (the great-granddaughter of the 70-year-old man).
* Issued by New York Life Insurance and Annuity Corporation (a Delaware Corporation), a wholly owned subsidiary of New York Life Insurance Company, 51 Madison Avenue, New York NY 10010. In New York, the issuer is New York Life Insurance Company.
** This income payment option is not available for tax qualified policies or in New York and Washington.
If the grandfather gifted his income payments to the granddaughter while he was alive, and the granddaughter lives to be 100, the policy would pay the granddaughter $496,909* in income payments. Including the $50,000 death benefit to her beneficiary, the total payout from the Lifetime Income Annuity would be $546,909.
If the grandfather selects a 5% cost of living adjustment, the initial amount the grandfather receives and gifts to his granddaughter is $1,347.
That amount grows each year, so that if the granddaughter lives to be 100, the policy pays $2,748,773* in payments to her (including the gifts from her grandfather during his lifetime) and $50,000 in a death benefit to her beneficiary, totaling a payout of $2,798,773.
Interested? Contact our agents to learn more.
Please note that the income amounts shown are pre-tax dollars. There may be gift, estate, and generation skipping transfer (GST) tax consequences for the grandparent/grandchild joint life option. Clients should consult with their own professional advisors to determine the appropriateness of any course of action.
* The amounts shown are for illustrative purposes only and are not a guarantee of the amount the annuitant will receive. This is the projected sum of all future payments if the younger annuitant lives to age 100. Payments will continue beyond age 100 if the annuitant is alive.
Illustration based on Lifetime Income Joint Annuity with 50% Death Benefit, 70-year-old male, 5-year-old female, $100,000 premium, rats as of 3/17/2006. Rates are subject to change, and payout will vary with age and life expectancy. This hypothetical example is for illustrative purposes only. Illustration assumes a 3/24/1936 date of birth for the male, 3/24/2001 date of birth for the female, and annuity payout start date of 3/24/2008. Some figures have been rounded to the nearest dollar for presentation purposes.
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|Create a Financial Legacy for Your Grandchildren—and Even Great-Grandchildren|