Substantial Immediate Income & 5.5% Rate
Today I want to highlight two large immediate income deals. It’s not often that we have substantial cases, because most settlements are smaller in nature. However today we have a Genworth and a John Hancock case each nearly $2 million in size. And each offers a long-term increasing income stream that is just perfect for retirement.
The most attractive case I have seen in years is this John Hancock case. At a 5.5% effective interest rate, this is truly an outstanding deal. With fixed annuities paying in the neighborhood of 3%, high quality bonds in the 3 to 4% range, and 20 year period certain immediate annuities in the 2 1/2% effective rate of return range, the 5.5% rate on the John Hancock case is an astounding value.
For an investment of just over $2 million, we can deliver a guaranteed 33 year income stream paying out $5,117,771.09. Can your financial advisor guarantee you the same output? I doubt it…
The beauty of secondary market annuities is that we can simply deliver more income, coupled with an outstanding guarantee, for a lower purchase price than other comparable investment options. No other retirement income plan comes close to this level of return, guarantee, and safety
The downside of the John Hancock case is that it cannot be split among several investors, it cannot be purchased with IRA funds, nor can a trust be the purchasing entity. But it is perfect for high net worth individual looking for a guaranteed income stream lasting 33 years, and we’re investigating the use of a simple LLC holding company to accommodate a couple of members to purchase the case. Call for details
The case starts paying $4880 per month in January of next year, and that payment stream increases by 3% per year for five years. Then in the middle of 2018, the income jumps from $5657 per month to $9478 per month. That income stream also increases 3% per year, and lasts 27 years. The final 12 months of payments are at $21,054 per month.
This is a substantial income from one of the top carriers in the business. With uniform A to A+ ratings and a Comdex score of 93, John Hancock is simply at the top of the game.
As if the John Hancock case wasn’t enough, we also have a Genworth case nearly the same size that pays out over a shorter period of time. The Genworth case starts in just a few months with its income at $10,350 per month. The income stream increases each year for 18 years, with a final 12 months at $17,620 per month.
Whereas the John Hancock case cannot be split, this Genworth case can be split among several investors, so if you are interested in a portion of this case, please let me know.
These two large immediate income cases show just some of the power of the secondary market for annuities. If either one suits your fancy please don’t hesitate to call to learn more.