Deferred Income Annuities and QLACs

Overview

There’s no question that retirement planning is a top financial objective for many consumers, notably “baby boomers” who are now—and will be for some time—crossing the retirement threshold. Among the many financial challenges facing retirees, one of the most significant is how to avoid running out of money. Supporting these retirees—and those who advise them—are many diverse retirement planning products, options, and strategies. Now, thanks to the IRS and to the insurance industry, advisors have two additional tools to add to their portfolio of retirement planning products.

This course provides a clear overview of two unique retirement planning tools now available: deferred income annuities (DIAs) and qualified longevity annuity contracts (QLACs). The course fully explores DIAs: what they are, how they are designed, and how they work. The second part of the course explains the QLAC rules and how deferred income annuities can be used to generate a guaranteed income stream for IRA, 401(k) and 403(b) participants, exempting the funds used to purchase the QLAC from the minimum distribution calculation.

Learning Objectives

Upon completion of this course, students will be able to:

  • demonstrate an understanding of deferred income annuities: their purpose, design and function
  • cite features and limitations that are common to today's DIAs
  • show an understanding of DIA payout structures
  • explain the rules that allow QLACs to be purchased with funds in an IRA or a defined contribution plan
  • show how QLACs can lower required distributions and generate a guaranteed income stream

Designed For

Life and health insurance producers; financial planners and advisors.
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