Annuity Ownership

There is a great article in Smart Money that discusses the tax implications of annuity ownership. The article also provides solid detail on swapping an existing annuity on a tax free basis through a Section 1035 exchange . A good reference for tax and Section 1035 questions. Source: Smart Money Full Story

Findings from a recent Gallup poll suggest that annuity ownership in the United States is dominated by middle- income households and individuals. Eighty percent of annuity owners have income of less than $100,000, while only four percent of annuity owning households have incomes in excess of $200,000. Other poll findings include: Almost half of the respondents have household income less than $50,000. Seven out of ten annuity owners are retired. The average age of annuity owners is 70. Women...

Retirement experts are working through the Retirement Security Project in Washington to develop concepts that would increase annuity ownership within 401k plans. Concepts include providing 401k participants with the ability to test drive annuities through an "automatic trial income strategy." In other words, at retirement about half of a person's plan assets would be placed in a trial income plan that would pay out a monthly annuity income for two years. Participants would then have the ability...