Can an Annuity Protect The Longevity of Your Assets?

Strange question to ask? Modern medicine and good eating habits have helped increase the average Canadian’s lifetime. Along with living longer comes the need to have sufficient savings to last for your longer lifetime. It has been my observation that older people begin a process of consolidating their assets by getting rid of things that they no longer need by either selling or simply giving them away and sometimes selling their large home in preparation to downsize to a smaller living space. In or near major Canadian cities, selling a home sometimes results in what looks like a financial windfall. If this happens to you, it likely will be hard to believe that so much money could now be sitting fallow in your bank account. It won’t be long before your bank sales representative calls you to suggest ways to invest this money because, for aggressive bank employees, it’s just too good a sales opportunity to miss. In addition to pressure from your bank to invest, it’s common for close relatives to offer to help you decide what to do with all this money. The odd relative may even suggest that a loan to them or even an outright gift would be timely. Elder financial abuse abounds across this country and even though we are concerned about it, there are still no firm guidelines to protect older Canadians.

So, what puts you in the cross hairs of the opportunist with get richer quick ideas who might want to share in part of the excess funds you have come upon?

You might have:

[a] Sold a valuable home or property in preparation to downsize for retirement.

[b] Won a lottery.

[c] Come into an inheritance.

[d] Sold your thriving business.

[e] The Stock Market has been good to you.

[f] You profited from early involvement in BitCoin.

Maybe it’s time to consider setting aside part of your new found wealth to purchase a guaranteed life pay annuity. Calculate how much locked-in regular income would cover basic needs, such as food, entertainment, maybe even rent and possibly travel. Doing this would remove the temptation for anyone, friends or relatives to take a run at your assets. Now, with your essential needs covered for the rest of your life, you can more comfortably deal with the capital that you have left. Now you might feel inclined to grant occasional gifts or loans to relatives, charitable organizations or friends. Give a telephone call to John Beaton, senior annuity specialist at 1-800-667-8818. He will be happy to hear your story and maybe give you some positive feedback.

Advanced Life Deferred Annuity

The 2019 Federal budget introduced the concept of the Advanced Life Deferred Annuity [ALDA]. This product is the biggest change in the Canadian retirement planning landscape in quite some time. Starting in 2020, an Advanced Life Deferred Annuity could be an investment option available to anyone with a Registered Retirement Savings Plan [RRSP], Registered Retirement Income Fund [RRIF], or similar registered plans such as a Defined Contribution pension plan.

Choosing an Advanced Life Deferred Annuity would permit up to 25 per cent of an individual’s registered investment accounts to be used to purchase an annuity that begins payments at the very latest by the end of the year in which they turn 85. There would be a lifetime maximum investment into such a plan of $150,000 that would be indexed to inflation and rounded to the nearest $10,000. Withdrawals from an ALDA would be fully taxable, and upon death any remaining funds in such an account would become fully taxable to the owner unless left to a surviving spouse, common law partner, or financially dependent child or grandchild.

While not necessarily for everyone, an Advanced Life Deferred Annuity could be an important option for the right retiree. For those retirees with significant registered savings, being able to defer up to 25 per cent of those savings to age 85 would reduce minimum required RRIF withdrawals during one’s 70s up until age 85 when the Advanced Life Deferred Annuity payments start. If high registered retirement income has the adverse consequence of Old Age Security clawback, then the Advanced Life Deferred Annuity might solve the problem for you. Look for further announcements about this new retirement annuity proposal.

What To Expect from Beaton Annuity Services

Most of my permanent annuity clients originate from the internet, although some do call me. Initially these clients are curious about current annuity market conditions. My response is to provide a free annuity market survey comparing current payout rates for the type of annuity that has been requested. After providing this information and further questions are asked by the inquiring person, my main agenda is always making sure the client gets what he or she wants. I’m focused on discovering what the client needs and providing services that meet those needs. If the client decides to go ahead with the purchase of an annuity that suits his or her need, I follow through the process to make certain that everything runs smoothly and that I’ve given best advice to maximize annuity payouts. After the sale, I’m available for follow up service.

The Value of an Annuity Broker

Why do so many Canadians seniors rely on an annuity broker like John Beaton? They have learned that there is no cost for the services of an annuity broker and the added value of unbiased information received is priceless. While the concept of an annuity is simple, there are many options not normally well known that can increase the value of one’s annuity purchase. Some tweaking of your purchase might increase your lifetime income. And don’t you agree, more income is good. For specific questions, call me at 604-535-2404 or toll free within Canada at 1-800-667-8818.