Written by John Saunders Thursday, 14 April 2011 18:01
Dick and Jane are nearing retirement age and have experienced some downturns on the health front. Jane has had a non qualified annuity that she took out six years ago. The original amount was 75,000 and that amount has grown to 150,000. Dick and Jane met with their advisor because they are very concerned with the looming possibility of needing long term care in the future. The last time they met with the advisor they were not impressed with the options that were presented and had earmarked this non qualified annuity for that purpose.
This time the advisor pointed out that their continued health erosion has made the conventional options even less attractive if not impossible to qualify for. The advisor explained that if they were to withdraw funds to pay for the long term care that they would pay additional income tax on the first 75,000 thus reducing their purchasing power of up to 30%. The advisor then explained that because of the Pension Protection Act that went in to effect January 1st 2010, they could use section 1035 of the IRS code to transfer the equity of their current annuity to a PPA approved annuity. They could add Dick to the eligible coverage and both Dick and Jane could withdraw money from the new annuity for the purposes of paying for long term care expense tax free. In addition because of the Pension Protection act there coverage would be as much as double there current savings in there annuity.
This would enable them, regardless of health, to make their money go farther and last longer for the purposes of paying for long term care expenses. Their advisor in a very short time has helped Dick and Jane provided much more spendable money for their long term care need If you have any questions concerning these types of products or other helpful information concerning long term care please feel free to contact Mr. John Saunders at Cypress and Associates at 11767 Katy frwy Suite 310 in Houston TX 77079 or give him a call at 832.492.1333 or email This e-mail address is being protected from spambots. You need JavaScript enabled to view it . On the web at http://www.ppanewsnetwork.com/.
