Annuity Update – August 2021 – Advantage Wealth Planning

In September 2020, I began a quarterly report on “Annuities”. In a nutshell, I’ll show the change in annuity payments over time, when all other parameters are held constant except current interest rates. I now have sufficient data and will reduce these updates to twice annually. This is the second and final update for 2021.

Methodology

Every month, I update the default annuity quote (using the Cannex system). The default client is as follows.

65 year old male who’s birthday is exactly 65 years on the date the annuity survey is produced,
invests in a “life annuity” using $100,000 from an RRSP,
invest in the annuity on his 65th birthday,
begins receiving monthly payments for life beginning one month after the purchase date,
chooses a “10 year guarantee period”. This option means should he pass away before the 10 years of payments are made, the “beneficiary” will get the balance of payments as a lump sum commuted value.

What’s Changed Since I first started reporting?

The default annuity payment has risen (all things being equal) to 5.9% from 5.7% since September 1, 2020.

Below is a chart with the highest monthly payments on the left side, and % payout on the right.

Feature – Assuris Annuity Protection – Who is That?

Assuris is an independent not for profit, industry-funded compensation organization founded in 1990. Their mission is to protect policyholders if their life insurance company fails. While remote, if your life insurance company fails, Assuris will seek to transfer your policies to a solvent life insurance company. Assuris guarantees that you will retain at least 85% of your insurance benefits that you were promised.

They cover many more insurance products, so for more information, click here to their website where you review download their consumer brochure which has more detail.

How I Can Help

Life annuities must be purchased by a life licensed insurance agent. I am able to service investors across Ontario Canada and we don’t have to meet in person one-on-one (read about my process here). If you would like to know what an annuity might pay in your situation, please click here to open the confidential form to request your custom Income Annuity Survey.

To learn more about annuities, enter your first name and email in the green box on this page. You’ll receive a series of short emails with more tips, information and education.

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Annuity Update – August 2021