Early this year we were asked by a client if she could obtain a really long term guarantee on a life annuity as she needed to know what would happen if she lived beyond age 100.
Problem of Living Beyond Age 100
She was 89 years of age at that time, her family was long lived but money for an inheritance for her two children was in short supply.
She realized a life annuity for her alone would pay very well since age is the most important factor in calculating income, not interest rates. But she was worried about depleting the expected inheritance for her children and needed an annuity to guarantee her income and provide for her children if time allowed.
Solution Of Age 100 Problem
We solved this problem by obtaining a term certain life annuity with guaranteed payments up to the 1st of January 2036 which is close to her 115 th birthday and I certainly hope she makes it that far..
She is receiving approximately $10,300 a year which amount will continue to her beneficiaries if she passes away before that date.
The lesson here is that provision, using term certain or life annuities, can be made for those who are following on. The beneficiaries cannot hope to obtain the financial return which an older persons attains through age, especially beyond age 100, so in that way they are better off than with a cash inheritance should she die before 2036 as likely.
Below I have set out the annuity survey. If you would like to see what your funds would pay, send us this short annuity quote form.
