Advanced Life Deferred Annuities Los Angeles CA

A look at Advanced LIfe Deferred Annuities (ALDA), an insurance policy that guarantees a lifetime income starting at the age of 80.

Local Companies

Etech Securities Inc.
(213) 389-2727
3600 Wilshire Blvd
West Hollywood, CA
Associated Securities Corp.
(323) 466-2003
5630 Hill Oak Dr
West Hollywood, CA
First Allied Securities
(310) 246-2325
1390 Miller Dr
West Hollywood, CA
Merrill Lynch Wealth Mgmt.
(310) 201-5917
2049 Century Park E
West Hollywood, CA
Goodman James Fine Art Brokerage & Appraisal
(310) 556-3033
1888 Century Park E
West Hollywood, CA
Morgan Stanley
(310) 788-2000
999 Avenue Of The Stars
West Hollywood, CA
Olivestone Financial Svcs
(310) 552-3566
1801 Avenue of
Los Angeles, CA
Centaurus Financial Inc
(213) 365-6422
3435 Wilshire Blvd
Los Angeles, CA
Horwitz Lewis Organization
(310) 275-7171
1840 Century Park E
Los Angeles, CA
Amistad Financial
(323) 939-6077
4929 Wilshire Blvd
Los Angeles, CA

Annuities For Dummies

Adapted From: Annuities For Dummies

Would you buy an insurance policy today that would cost you about one-fifth of your savings and pay you a guaranteed lifetime income starting at age 80 or so? If you died before age 80, you'd lose your original premium, but if you lived to age 85 or 90, you'd eventually get back much more than you paid up front.

What is described above is an advanced life deferred annuity, or ALDA. On the surface, this might seem like a bad investment, but it's not really an investment at all. Instead, it's insurance against the risk that you'll live longer than you can afford to. Indeed, actuaries and economists call it longevity insurance.

You've probably never heard of ALDAs. So far, only a few insurance companies sell them. But they're worth considering. In addition to removing your fear of running out of money in retirement, they can make retirement planning easier. They can even make spending money in retirement more fun.

How ALDAs work

In an unadulterated ALDA, you give a portion of your retirement savings — 10 to 25 percent — to an insurance company in return for a guaranteed specific monthly income starting at whatever age you choose — 75, 80, or 85 years.

The earlier you pay for the contract, the better, because your premium will have time to earn in the carrier's coffers and buy you more income later. The later you start receiving payments, the more income you'll get each year, simply because you'll collect your benefits for fewer years.

How ALDAs save you money

What ALDAs lack in cash value, they make up for in insurance value. You can guarantee yourself much more income at age 80 or 85 by buying an ALDA than by self-insuring — that is, by under-spending or setting up a rainy-day fund that you can use "just in case" you live longer than you expect.

Here's a comparison of the two strategies:

  • With self-insuring, you might set aside your own personal old age fund at age 60.

    For instance, if you put $23,700 in reserve at age 60 and invested it in bonds paying 5 percent per year, you'd have about $80,000 by age 85. You could then buy an annuity that paid $1,000 a month for life. If you died before age 85, your heirs would get the entire reserve.

  • With an ALDA, you'd pay only about $16,000 (according to one company's quote) at age 60 for a lifetime income of $1,000 starting at age 85. That's a savings of $7,700.

Why is the ALDA cheaper than self-insuring? For the same reason that homeowner's insurance is cheaper than paying for damage to your home: because most homeowners never file a claim, and their premiums are used to reimburse the few who do. Similarly, the premiums of the ALDA owners who don't reach age 85 — and never file a "claim" — go to pay for the ones who do.


provided by:


For Dummies is a registered trademark of Wiley Publishing, Inc. in the United States and other countries. Used here by license.


Featured Local Company

Etech Securities Inc.

(213) 389-2727
3600 Wilshire Blvd
West Hollywood, CA


Rss   Delicious   Digg   Add To My Yahoo   Add To My Google   Bookmark   Search Plugin

Topics:
Advertising Family Home Services Real Estate Resources
Business Services Fashion Industrial Goods & Services Retail & Consumer Services
Career Financial Services Insurance Software
Cars Food & Beverage Internet Technology
Computer Hardware Franchise Legal Telecommunications
Construction Health Miscellaneous Trade Shows
Education Holidays Nightlife Travel
Entertainment Home Appliances Online Database Weddings
Environmental Home Electronics Pets World History