Funding an annuity can be one of the most important financial decisions that a person makes over their lifetime. If something were to happen to you, what would happen to the annuity? The good news is that annuities allow for beneficiaries to be named so that any payments from the annuity go to whoever you chose without probate or any legal proceeding regardless of who the beneficiary is.
Can Annuities Be Assigned To Beneficiaries?
Annuities can be assigned to one or more beneficiaries, depending upon the type of annuity and whether it is already paying out an income. Some annuities have a specific death benefit provisions. So, be sure to check. In general, a beneficiary may be anyone; that person does not need to be related to the annuity owner.
How Do Beneficiaries Receive The Money?
A beneficiary to an annuity can receive their payout in a variety of ways. It can be paid out in a lump sum, or the annuity can continue to make payouts as before or possibly reduced but stretching the payments out to the beneficiary’s life expectancy. Some types of annuities allow for the money to be withdrawn in increments over a period of five years (or for the entire balance to be withdrawn at the end of five years).
Are Annuities Taxable When Inherited?
Annuities generate the same amount of taxable income to the beneficiary as they would have for the prior owner for the same type of payout. They are also treated like any other asset for estate and inheritance tax purposes.
Trust The Experts To Provide Competitive Rates And Stable Returns
If you are looking for a reputable company to provide your annuities and help you achieve your financial goals without the hassle of working through a middleman or agent, trust Pillar Life Insurance.
At Pillar Life Insurance, we empower our customers to take charge of their financial goals and objectives by offering seamless DIY products, cutting out the middlemen. Start growing your money with our secure, easy-to-use insurance platform by creating an account.
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