Discount for purchasing annuities - Posted by Elena Schumann

Real Estate Investing
#1

Posted by Michael Morrongiello on August 27, 2000 at 22:55:09:

If the payments are paid monthly and the insurance company is reputable with a strong AM Best rating, then a 12% -13% +/- yield should be sufficient. If you are talking about lump sum payments only with NO monthly installments then a higher return is customary.

Michael Morrongiello

#2

Discount for purchasing annuities - Posted by Elena Schumann

Posted by Elena Schumann on August 26, 2000 at 19:52:28:

Does anyone now what kind of discount you would use in purchasing an annuity provided by an established insurance company?

By “discount”, I mean the discount interest rate you would use to determine the present value of the annuity.

I other words what “return” does one usually get when they buy an annuity.

Thanks.

#3

Re: Discount for purchasing annuities - Posted by Brent_IL

Posted by Brent_IL on October 27, 2000 at 10:21:34:

Don’t forget to check the surrender charges listed in the policy. Some excellent annuities have two completely different schedules, one for amortizing, and the other if the policy is surrendered for cash. The policy loan provisions may also influence your decisions.

#4

Re: Discount for purchasing annuities - Posted by Ron Ohara

Posted by Ron Ohara on October 27, 2000 at 03:28:39:

Each company who purchases Insurance Annuities, each have their own set yield. Based upon the ratings of the Insurance Company and what type of payments are made (monthly; annually, lump sum payments) will determine what is set forth on the purchase. Also beware, if this is the only source of income for the annuitant, most comapanies will not purchase the payments or if the payments are high enough, may do a “split” payment with the annuitant (1/2 of the monthly payment). Credit does play in the purchase and pricing along with any type of alimony or child support the annuitant may have or required to pay). I have used quite a few in the past in which I have noticied that the yield always did not come out the same even though all the particulars may have been.

Ron Ohara
Capital 500 Funding