Annuities for Legacy

Leaving behind money to your loved ones is a high priority for many retirees.  Annuities are an excellent vehicle for that because they grow tax deferred and pass directly to the named beneficiaries and bypass probate court.  All annuities have a beneficiary designation, but some annuities are designed to maximize beneficiary or, legacy payouts through the use of a guaranteed, fixed accumulation rate that grows regardless of any interest crediting or index performance. These special “Legacy” accounts grow separate from the annuity value and cannot be cashed out by the owner, but will convert to money when the annuitant passes away.  Another popular form of an annuity designed for legacy is called a “charitable gift annuity.” With a charitable gift annuity, the annuitant is considered a “donor” and they will give the money into an annuity and transfer ownership to the charity of their choice which is a tax deductible gift.. The donor will then receive lifetime payments from the annuity, however, these payments are lower than if annuitized in a SPIA, DIA or even a lifetime income rider, please consult your tax advisor when it comes to charitable gift annuities and how much can be written off.