Using Multiple SPIAs to Create a Legacy
The Story
Many clients have multiple grandchildren and they want to leave a legacy for each one.
The Problem
Ray wants his grandchildren to remember him long after he has passed away. Ray wants to create an annual income stream on their birthday every year.
Client Profile
- Ray is 80 years old
- Ray has four grandchildren ages 10, 12, 16 and 18
- Available assets of $200,000 to fund a legacy for his children
How it Works
Ray purchases four joint-life single premium immediate annuity (SPIA) contracts for $50,000 each. For each contract, Ray is a joint owner and one of his grandchildren is a joint owner. At Ray’s death, the income stream continues to the grandchildren for their lifetimes.
Why SPIA?
Ray has created a legacy for each grandchild and set up the funds to be deposited from the annuity into the grandchild’s bank account on their birthdays. Ray has also included a 3% COLA increase on the annual payments.
The Result
Ray continues his legacy with a birthday present for each grandchild for the rest of their lives. The average annual starting payment per child is:
- Year 1: $683
- Year 20: $1,198.38
- Year 40 $2,164.41
Retirement is one of the most important financial events in a person’s life. As SVP, Retirement, Brendon Kelley facilitates our team to make planning for retirement as straightforward as possible. From having the initial conversation to handling licensing and submitting applications, Brendon’s committed to keeping the annuity process running smoothly.
