Using an SPIA to Purchase Life Insurance

If you work with older, high net worth clients, you have most likely uncovered the need for life insurance, either to provide estate liquidity or for the purpose of increasing a family legacy. Whatever the reason, a life insurance policy is a major purchase for older clients, often requiring the payment of large premiums for the remainder of their lives. While you wouldn’t recommend such a purchase for any clients who don’t have the income or the assets to comfortably cover the premium payments, you could greatly enhance the financial position of those who do with the use of a Single Premium Immediate Annuity (SPIA) as a funding source.

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Annuities and Retirement Planning

Retirees’ demand for more predictability and security in their retirement income has led an increasing number of financial advisors to look to annuities as way to provide more stability in their clients’ investment portfolios. They are also looking to annuities as a way to replace the third leg of the retirement income stool as a guaranteed lifetime income. Retirement planning occurs in different phases and at different stages of peoples’ lives. Depending on what stage of life a person is in, there is different kind of annuity that is best suited for their situation.

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