Life settlement refers to a financial transaction in which a person sells their existing insurance policy to a life settlement company for some percentage of a policy amount. The selling price of a policy is no doubt less than its face value but it can be five to nine times greater than surrender value of the policy. Life settlement provides instant money which is enough to cater to your long term care needs.Once you have sold your policy, the life settlement company becomes the new owner and beneficiary of your policy and it will collect all the benefits after policy maturation. Besides offering you an instant amount for your policy, the settlement company also becomes responsible for paying all of the insurance premiums until maturity of the policy. Senior citizens over 65 years of age and have a viable insurance policy can opt for life settlement. However, considering a life settlement is a critical decision and should be thought thru carefully after reviewing your needs and concerns.A few reasons to consider to selling your insurance policy are:

You require funds to pay for long term health care or housing needs.
The policy is about to lapse or you are planning to surrender it.
Insurance premiums are no longer affordable.
There has been a change in your health status since you first purchased the policy.
You are interested in new life insurance, annuity or long term, care coverage.
Changes have been introduced in estate taxes.
In spite of so many reasons for selling an insurance policy, some people may still want to keep the life insurance policy as all individuals have different goals, situations and requirements. Here are some instances where you might consider keeping your policy instead of selling it.
You have to pay off a large debt or mortgage. In this instance, the death benefit can be utilized for paying off the mortgage.
You want to pass on your legacy to your desired charity. You can name your favorite charitable organization as the beneficiary of your policy.
You want to leave a death benefit to your survivors such as your spouse, children or grandchildren.
In case of your or your spouse’s death, you will face a major state or federal estate tax. Life insurance can be used to pay off estate taxes which are due.
You wish to have an assisted living facility, a nursing home or a home health aide but are short of money to pay for such care. You may use the cash value of the policy to pay such expenses.
Considering a life settlement is an important decision that should only be made after fully understanding your needs and requirements. Feel free to browse through http://www.mickelsonlife.com for more information on life settlements.

By David Mickelson

Annuity Insurance Life presents the following advice on estate issues.  Is your estate in order for your retirement, or if something were to happen to you today?  Consult with a life insurance profession for more information on life insurance and annuities for your retirement and estate planning needs. 

There are many things to consider before you die. Unfortunately, leaving your assets is one of them. Obviously, you need a will, a medical directive, and a power of attorney. In addition, it would be helpful for your beneficiaries if you had a financial notebook or some kind of estate notebook which has all of the materials need in the event of your death.
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Annuity Insurance Life presents the following advice on incorporating annuities into your retirement plans.  I know that I am certainly working toward my lazy Mondays in my golden years!  Consult with a life insurance profesional to find out how annuities can help you to achieve your lazy Monday retirement dreams! 

As you approach retirement, the prospect of sitting back and relaxing with your feet on the footstool, without work beckoning on Monday morning seems particularly inviting. To enjoy your twilight years with peace of mind, you would need a steady source of income that enables you to live comfortably.
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Annuity Insurance Life presents the following article about the differences between fixed and equity annuities.  You can also refer to the various pages or tabs on our website for an explanation of each type of annuity.  Contact a life insurance professional for more information and how annuities can become a key part of your retirement portfolio planning. 

When considering the difference between a fixed and equity annuity, investors should remember that equity annuities, also called equity-indexed annuities, ARE fixed annuities. Both the fixed and equity annuity are designed for conservative investors, but equity annuities can provide potentially higher rates of return than traditional fixed annuities.

An equity-indexed annuity offers a combination of traditional insurance product features, like a guaranteed minimum rate of return, and some features of traditional securities, such as returns linked to equity markets. Typically, an equity-indexed annuity is not subject to regulation by the Securities and Exchange Commission, but this depends on the combination of features provided in a particular plan.

Equity-indexed annuities, or EIAs, differ from traditional fixed plans in how interest is credited. In most cases, an insurance firm purchases an option in a particular index, such as the DOW or NASDAQ, and after a period of time, the option contract is due. At that time, if the market index has risen, the option is cashed in, with the interest credited to the annuity principal. If the market has decreased, the option expires without any interest being credited to the annuity account for the year.

Equity annuities are relatively new in the marketplace. They were introduced after the major stock market correction that occurred between 1999 and 2002 as a way to provide greater returns than traditional fixed annuity plans, but with greater reliability than a brokerage account.

What Investors Should Know

State insurance departments consider equity annuities to be fixed annuities. While the equity annuity account is not subject to the fluctuations of value experienced by variable annuity plans, an equity annuity does not function exactly like a fixed annuity either.

In actual practice, the annuity plan gains or maintains its value every year, and the investment cannot lose value as a result of negative market movement. All EIAs provide a minimum guaranteed return. Most equity-indexed plans also provide a fixed-interest account as an investment option as well, so when interest rates are high and the market is declining, this account could be used to credit interest to the principal annuity amount.

How Equity Annuities Perform

Equity-indexed annuities have historically provided average returns of seven percent or more. When the general markets perform well, the annuities do well too, and it is not uncommon for interest payments in good economic years to total between ten percent and 20 percent. And if the market drops rapidly, the value of these plans is evident, since they will maintain their principal and the interest earnings gained during past years.

Because of this, retirees who want safe and secure investments without sacrificing good interest rates favor equity-indexed annuities. These annuities offer significant peace of mind to investors, since they know that the investment value cannot decrease.

Agents and brokers like equity-indexed annuities because their returns are linked to market activity indexes rather than to individual stock or fund performance. This means they are not viewed as investment products by the Securities and Exchange Commission and not subject to its regulation.

Equity-indexed annuities provide a guaranteed minimum return and the safety of traditional fixed annuities, while offering potentially higher rates of return like a stock-market investment, but without the risk.

Before investing in an equity-indexed annuity, individuals should review the contracts carefully and note any surrender charges imposed for early withdrawals. These charges do decrease as the amount of time an insurance company holds the funds increases, however.

By: Steven Hart

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Annuity Insurance Life and how women may not be properly planning for their retirement.  Many women, even working women, often depend upon their husbands or partners to make the key retirement planning decisions.  Women, working or otherwise, should take investing in their retirement seriously and and act immediately.  Consult with a life insurance professional for more information on how life insurance and annuities can become part of a sound retirement plan. 

68 percent of women aged 50-59 are currently in the labor force, and 22 percent of these working women over 50 never plan to retire. What are they doing? Here are three popular options that most women are planning and investing for.
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Annuity Insurance Life and what you should know before buying annuities.  Annuities can be a key element in a retirement plan.  Contact a life insurance professional for more information as to how annuities may be a perfect fit for your retirement and investment needs. 

Americans hear a lot about the shaky outlook for Social Security. In the future, the federal program likely will play a smaller overall role in Americans’ retirement plans.

One way to fill in the gaps of a savings portfolio is to put money in annuities. With an annuity, you pay a premium in exchange for guaranteed income payments at regular intervals. It is most often used for retirement purposes.

The basic types of annuities are equity indexed, fixed rate and variable. The major advantage of annuities is that they all guarantee benefits such as tax-free growth, the ability to pass money directly to heirs or charities and an income stream for life.

Over the past few years, equity-indexed annuities have gained a great deal of popularity. They offer interest or benefits that are linked to an external equity reference – a stock index like the S&P 500, for example. But you get a guaranteed minimum return in exchange for a limited maximum return; that is, you get less upside, but also less downside, to your stock-market investing. Your principal is never at risk.

Fixed-rate annuities, on the other hand, guarantee an interest rate and a declared minimum. They have traditionally been the most popular annuities.

Variable annuities provide more options. They enable you to invest in stock, bonds, mutual funds and money-market instruments.

Reputable financial companies, like TrueYield Financial, want to make sure investors are comfortable when purchasing annuities. Here are some tips for the potential investor.

* Be sure the firm you work with is not limited to offering just one company’s annuities. There are many options available, so work with an agent that can get the one that best fits your needs.

* Understand what you are buying. Talk to your financial adviser or agent about which annuity may be right for your retirement portfolio. Fully understand the annuity contract you are considering.

* Define your goals. Annuities can be used to accomplish a number of financial goals. For example, they can supplement your monthly income or provide emergency funds. Decide which purpose your annuity will serve.

* Ask your agent if you have a "free look" period to review your annuity contract and make sure you have made the right decision.

* Investigate whether or not a bonus annuity is right for you. Bonus annuities credit premium bonuses to allow a retirement saver to make up for stock market loss or to provide an immediate boost to the account value.

By: Silvester Thompson

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Annuity Insurance Life presents the following thoughts about getting yourself ready to deal with buying life insurance.

None of us want to think of our mortality.  However, we must to set ourselves and our families up for financial success.  Contact your life insurance professional to discuss the life insurance and annuity options that are right for you and your financial and retirement planning.

Most close their minds when buying life insurance. After all, who wants to think about death? Read this article and get mentally prepared to meet with a life insurance agent.
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Annuity Insurance Life presents the following article on life insurance for children.  We have all seen the commercials, and I myself have wondered about getting life insurance for my kids.  Talk to your life insurance professional for more information and if this makes sense for you and your family.

Typically many have an inclination to get life insurance for those that supply the wages for the family. In the event that they die, there will still be a financial reserve for the family to depend on.
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Here is some great information on variable annuities. Variable annuities can be a great investment vehicle, contact a life insurance professional or financial advisor for more information and to fully understand how investing in annuities will work for you.

GMIBs. GMWBs. GMABs. GLWBs. What do these acronyms mean? If you own a variable annuity (or think you might want to own one), they stand for a new class of living benefits that make these investments even more attractive.

Guarantees for a new market climate. You might say these new living benefits address the realities of a down market. Variable annuities are tax-deferred investments structured to pay you benefits over a set number of years, and a death benefit to your beneficiaries. They let you invest some of your annuity assets in investment subaccounts that suit your investment styles and goals. Some of these subaccounts have guaranteed return rates.

All of this appeals to people who want to build retirement savings conservatively. But with the financial markets so volatile of late, GMIBs, GMWBs, GLWBs, and GMABs are really appealing. These are riders in annuity contracts that guarantee certain benefits regardless of how the markets perform.

Guaranteed minimum income benefit (GMIB). A GMIB ensures that the annuity payments that come your way are at least a specified minimum amount, even if your investment subaccounts perform poorly.

Guaranteed minimum withdrawal benefit (GMWB). If the principal of your variable annuity shrinks due to a downturn in the market, you can use this rider to recoup the amount of your entire initial investment.

Guaranteed lifetime withdrawal benefit (GLWB). This means guaranteed income payments for life, even if the account value falls due to poor investment returns.

Guaranteed minimum accumulation benefit (GMAB). A GMAB gives you the confidence of knowing that after a set period of years, you will have at least X dollar amount of assets in your variable annuity.

Long term care insurance options. This is certainly a new wrinkle in variable annuities and worth knowing about. Some variable annuities now allow you to pay long-term care benefits from the life insurance death benefit promised in the annuity contract.

Very interesting, isn’t it? If you’d like to know more about the new living benefits in variable annuities, why not talk to a qualified insurance or investment professional today? These new annuity options may give you more financial confidence – and financial choices – for retirement.

Ivy Pierson is a Representative with Woodbury Financial Services and may be reached at 661-297-7566. Originally published on SantaClaritaMagazine.com.

Annuity and Life Insurance reminds you of making sure that you understand the contract language of your annuity.  If you have any questions about this issue, contact the broker or life insurance agent that assisted you with your annuity for more information. 

Contract language can lead to unintended inheritance consequences

PalmBeachDailyNews.com, By Gail Liberman, Special to the Daily News

Well, now that you, hopefully, just concluded a romantic Valentine’s Day, how surprised would you be if the love of your life disinherited you?

Yet it happens — too often, inadvertently.

Here’s an example of how, suggests Kevin Loffredi, co-founder of Advance Sales Corp., the Oakbrook Terrace, Ill., publisher of Annuity Intelligence Brief.

Your spouse is listed with you as an owner of your variable annuity contract, while the children are listed as beneficiaries. When the first spouse dies, the money goes to the beneficiary children instead of paying out to the surviving spouse, as was intended.

To avert this issue, the contract should have been titled with a "joint-and-survivor" option. The children would be "secondary beneficiaries," he says.

Loffredi has claimed that a whopping 38 percent of variable annuities are improperly titled.

One of four contract owners could experience serious problems, according to his recent report. And one of 10 contracts could wind up in arbitration court because of inheritance or tax disputes.

Variable annuities, which are contracts with life-insurance companies that let you invest in a selection of investments, often mutual funds, are particularly complex.

But I’ve heard of titling problems that span a lot of other types of assets as well.

Today’s headlines may deal with Bernie Madoff and the impact of our lousy economy. Titling errors, though, can create even worse financial news.

It all sounds like a no-brainer. Of course, you own your assets. You probably want your spouse to inherit your assets when you die. Or, perhaps, you want your kids to have them. Therefore, they’re beneficiaries, right?

However, beware as your finances become complex.

Loffredi says in some cases, the annuity contract lists the children as the beneficiaries, but the annuity holder’s trust states that the proceeds should go charity.

Lack of financial planning can add tax problems to the equation. Before an annuity can be transferred to a trust, for example, the title must be changed. Nevertheless, once you transfer ownership, federal taxes often are owed.

Have you already put your annuity into a living trust and designated the trust as beneficiary? If this happens, the proceeds are paid to the trust when you die. The trust then determines who gets the money. Meanwhile, if a surviving widow is entitled to any of the proceeds, she’ll likely have to pay taxes on them. This situation might be avoided by naming one or both spouses as owner(s) and the surviving spouse as primary beneficiary, with the trust as the "contingent" beneficiary.

Through this arrangement, variable annuity investments could continue to grow tax-deferred for the remaining spouse, Loffredi says.

Does your annuity have an enhanced death-benefit guarantee, in which the beneficiary gets the principal or stepped-up market value, whichever is greater, when you die?

In that case, if both spouses are listed as contract owners, there could be problems.

When one spouse dies, the surviving spouse, depending on the insurance contract, may be cheated out of the annuity’s enhanced death benefit value.

If you have a variable annuity, consider running some of these potential issues by an estate planning attorney who has an extensive background in taxes and insurance.

It can pay to head these problems off at the pass.

Gail Liberman is co-author of several books with her husband, Alan Lavine. Their latest, published by Que, is "Quick Steps to Financial Stability."