Actually, with the passage of SECCURE 2.0, QLACs bring an additional RMD-related advantage to the table. Not only can RMDs on that portion of your IRAs be delayed, but those larger QLAC distributions can now "optionally" be counted towards the RMDs for the remainder of your IRA assets. But neither of these were the reasons why my wife and I ech purchased QLACs. Rather, they act as a means of counteracting the purchasing power drag of inflation on our fixed nominal dollar pensions.
While I'm a fan of annuities in general, I'm not a fan of QLACs. The only thing that makes a QLAC different from other annuities is the deferral of RMDs. Deferring a more modest RMD early in retirement to an already larger but now much increased RMD later in retirement tends to make tax planning worse, especially when considering the higher single-filer tax rates of a widow.
Ok, the health technology argument is silly. If you watch the obituaries of rich dudes who can buy the best medical care, they can barely make it past 92-93. Very old age is still a mystery. Studies of genetics: nada. Studies of lifestyle: nada. Studies of diet. There’s a really cool 3 hour podcast Dr. Attia had a long form interview with a longevity reasearcher who is a no nonsense lets get the data guy. (2022 ish). The only question is do you feel lucky? Should you? Also expectancy does not equal average or median. Life expectancy is a crapshoot. What’s not a crapshoot is that most people start losing mental capacity in their sixties and there’s a great book called “when I get stupid”. A CPA wrote it describing how too protect your future self from yourself (and also elder abuse, institutional abuse. Case in point, my brilliant MIL was vulnerable to scammers and the onslaught of charitable orgs exploiting her. In no way would she be declared incapacitated but still she’d return phone calls to Jamaica to not be rude. Just sayin’
Actually, with the passage of SECCURE 2.0, QLACs bring an additional RMD-related advantage to the table. Not only can RMDs on that portion of your IRAs be delayed, but those larger QLAC distributions can now "optionally" be counted towards the RMDs for the remainder of your IRA assets. But neither of these were the reasons why my wife and I ech purchased QLACs. Rather, they act as a means of counteracting the purchasing power drag of inflation on our fixed nominal dollar pensions.
Everything I read says you are absolutely Wrong on the idea that QLAC distributions can count toward your RMD requirements.. they don't.
Does my money in a QLAC earn interest for me or for the issuer ?
While I'm a fan of annuities in general, I'm not a fan of QLACs. The only thing that makes a QLAC different from other annuities is the deferral of RMDs. Deferring a more modest RMD early in retirement to an already larger but now much increased RMD later in retirement tends to make tax planning worse, especially when considering the higher single-filer tax rates of a widow.
I’m trying to figure out how to model that in MAXIFI. Do you have a model to demonstrate?
@@Gzluweez You should google "maxifi qlac". There is an article in their solutions center.
Did congress really think people need more annuities or did life insurance companies just pay congress a lot?
Ok, the health technology argument is silly. If you watch the obituaries of rich dudes who can buy the best medical care, they can barely make it past 92-93. Very old age is still a mystery. Studies of genetics: nada. Studies of lifestyle: nada. Studies of diet. There’s a really cool 3 hour podcast Dr. Attia had a long form interview with a longevity reasearcher who is a no nonsense lets get the data guy. (2022 ish). The only question is do you feel lucky? Should you? Also expectancy does not equal average or median. Life expectancy is a crapshoot. What’s not a crapshoot is that most people start losing mental capacity in their sixties and there’s a great book called “when I get stupid”. A CPA wrote it describing how too protect your future self from yourself (and also elder abuse, institutional abuse. Case in point, my brilliant MIL was vulnerable to scammers and the onslaught of charitable orgs exploiting her. In no way would she be declared incapacitated but still she’d return phone calls to Jamaica to not be rude. Just sayin’
Roth will always win because of the Beneficiary benefit. No child wants their parent's taxable liability at our worst taxable time frame.
Stan you talk to much , let your guest do the heavy lifting. I still love you player!
I agree, and do them the courtesy of looking at them when they are talking. ❤