Even if you’ve put together the most rock-solid financial plan possible, it could be that after you’re gone, things won’t necessarily go the way that you intended them to. This can be particularly true if a loved one doesn’t share the same monetary values as you do.
For many individuals, the transfer of wealth from one generation to the next can seem ominous. And why wouldn’t it, since the majority of wealth transfer plans fail?
In other cases, people just simply put off this type of planning altogether – until it becomes too late.
Either way, it often ends up that the bulk of your hard-earned assets will go straight into Uncle Sam’s pocket.
The truth is, though, that if legacy planning is done right, it can run like a well-oiled machine…and it doesn’t have to cost you a hefty fee, or even take a substantial amount of time to put your future wishes in place.
This all starts by working with the right advisor who can guide you towards the proper financial tools.
Creating a Long-Lasting Legacy for Your Loved Ones
One way to ensure that your survivors are able to move forward financially is by stretching out the death benefit on an annuity. How exactly does this concept of stretching work? With this strategy, “stretch” withdrawals are actually death benefit distributions. So, federal tax penalties or early withdrawal charges do not apply – as long as you have the annuity set up in the proper manner. (Otherwise, the surrender charges may be incurred). Stretching your annuity benefits can essentially provide a lifetime income stream to your beneficiary, provided that they withdraw a minimum amount each year from the contract. Using this concept, multiple beneficiaries can also receive distributions from the annuity. And, depending on how you have set up the contract, your chosen beneficiary can select future recipients, or alternatively, you can do so yourself. Plus, with a stretch annuity, you could ultimately pass along to your heirs more than just the annuity’s death benefit – and you can even provide for multiple generations down the road. Going this route, then, can provide a number of key benefits, including:- Tax efficiency. Your beneficiary will only pay income tax on the amount of taxable gain that is distributed. This can result in a lower amount of income taxes paid over time.
- Tax deferral. Because the account value remains invested in the annuity, this can allow for continued growth potential, which in turn, provides the opportunity for more tax-deferred, compounded accumulation.
Take Advantage of Tax-Deferred Growth Plus Principal Protection
On top of stretching out the income from the annuity, the funds that remain in the contract can continue growing tax-deferred, based on the annuity’s crediting method and/or interest rate. And, if you’re using a fixed index annuity, if the index performs poorly in a given year, the principal in the annuity won’t suffer a loss. If this sounds too good to be true, it isn’t. And, with the right plan in place, you and your loved ones can benefit for years to come.Removing the Guesswork and Keeping Your Plan Intact
So where do you go from here? The best way to ensure that all of your plans are in place the way you want them to be is to work with an expert in the annuity field. That’s where Annuity Gator comes in. Not all annuities are created equally – and there are only a handful of insurance carriers that allow the stretch concept with their products. So, wading through the maze of annuity options can often be extremely time-consuming, and can end up causing you to be even more confused about the right way to implement your plans. The good news is that we know exactly which annuity does what, and because of that, we know just where to look for the option that will best suit you…and those you care about. At Annuity Gator, our mission isn’t to sell you just any annuity, but rather to help you find the best annuity possible for your specific needs. Everyone’s financial goals are different – and there are thousands of annuities in the marketplace to choose from – so it can be challenging at best for investors to match a plan with the best possible financial tools. But when you partner with Annuity Gator, you can easily work your way through all the confusing jargon, because we’ve already done the heavy lifting for you. Want more information? Just call us at (888) 440-2468, or contact us through our secure online contact form here to set up a time to chat.
