Annuity News

Annuity Taxes and Section 1035 Exchanges

There is a great article in Smart Money that discusses the tax implications of annuity ownership. The article also provides solid detail on swapping an existing annuity on a tax free basis through a Section 1035 exchange . A good reference for tax and Section 1035 questions. Source: Smart Money Full Story

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1035 Exchange

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Section 1035 Exchange

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The One Year Waiver of IRA Required Minimum Distributions

The IRS requires that individual retirement account (IRA) owners start taking minimum distributions from the account once they reach age 70 1/2. Failure to take the mandated withdrawal triggers a 50% tax penalty on the amount that should have been taken out. The financial crisis has prompted the government to approve a one year suspension of the required minimum distribution rule. The article referenced at the bottom of this page provides very good information about IRA withdrawal rules and the...

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Rule Changes Will Provide Broader Access to Roth IRAs

The income limits on Roth IRAs will change in 2010. Current restrictions on Roth IRAs are set at $105,000 for singles and $166,000 for couples. Removal of these restrictions will open-up a much wider market for Roth IRAs. Higher income earners will simply need to establish a conventional IRA and then convert to a Roth. Taxes due on the conversion can be paid over the course of 2011 and 2012 rather than at once in 2010. Source: Investment News Full Story

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Dollar Vulnerability Presents Interest Rate and Inflation Risk

Politico recently reported on the possibility of a concerted attack on the U.S. dollar which, if valid, could have a meaningful impact on annuity owners and other recipients of fixed income . The story suggests that Arab oil sheiks are conspiring with the Chinese and Russian governments to eliminate the U.S. dollar's role as the reserve currency in the global oil trade. The dollar's role in the oil trade serves as a linchpin for its relative strength and role as the world's overall reserve...

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Fees, Portability and Fiduciary Risk Continue to Present Hurdles for In-Plan Annuity Market

"In-Plan" annuities refer to the use of annuities within defined contribution pension programs such as 401k plans. The concept is relatively new, but the timing should be a perfect the concept to gain traction: The financial crisis has devastated the portfolios of many retirees and near-retirees. Millions of baby boomers will add to the 70 million or so U.S. residents over the age of 55. People are starving for stable, guaranteed sources of income in light of market volatility and increasing...

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Putnam CEO Advocates New Approach to Retirement Planning

Putnam Investments CEO Robert Reynolds spoke about the notion of "lifetime financial product allocation" at a recent industry conference. Reynolds supports the notion of a range of products over the course of one's lifetime that include: Lifetime income options to hedge against longevity risk . Relative return strategies to hedge inflation risk . Absolute return strategies to deal with both inflation and volatility risk ( sequence of returns risk ). Reynolds offered comments on the over-...

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AXA and ING Developing New Generation of Retirement Products with Guarantees

AXA and ING are in the process of launching a new generation of retirement products. Money Management reports that the two companies are developing a new line of retirement income products that provide more flexibility than traditional annuities. The products, which include AXA's "North" product line, are essentially traditional investments with an underlying safety net that is created through a hedging program. "Unlike old-style annuities, the client can withdraw from the product at any time (...

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Brett Arends on Life Settlements

Wall Street Journal personal finance columnist Brett Arends wrote an excellent piece on life settlements from a consumer perspective. Arends discusses: The inefficiencies of the life settlement market. When a life settlement makes sense. What to watch out for as a potential seller of a life insurance policy. Rates of return (10-12%) for buyers and investors in the life settlement market. The top three considerations for sellers in the market. Source: Wall Street Journal Full Story

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New Technology May Enable Rapid Cancer Screening and Detection

Researchers at the University of Toronto's school of medicine have developed a device that will enable rapid cancer screening. The device--a microchip--could can detect certain biomarkers associated with cancer in a matter of minutes. This technology would detect in minutes what now takes hours. Researchers hope that the innovation will lead to more frequent cancer screenings and hopefully higher overall levels of early detection. Source: Scientific American Full Story

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Innovation

Cancer

Technology

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Explaining the Longevity Gap

The longevity gap refers to lower longevity rates in the United States relative to other developed countries. Critics of the U.S. healthcare system point to the gap as a characteristic of the flawed health insurance system. However, a recent New York Times article discusses the research of Samuel H. Preston and reveals some of the errors contained in the logic of critics of the U.S. health system. Source: New York Times Full Story

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