On 7/3/2025 8:59 AM, sunfis...@yahoo.com wrote:
Michael,
I don't dispute anything of what you say, as you are far more
knowledgeable on these subjects than I.
I did, however, have something of a philosophical thought regarding
the annuity.
You note that the value of the asset "evaporates" upon death. You also
note that the value of the asset does not change with payments to the
annuitant.
The philosophical question that comes to me is this: if the value of
this asset doesn't change with payments, and disappears upon death,
does this asset actually have any real value now?
It is a CONTRACT. The contract guarantees payments of "rents" until a
conditional event occurs. So at THAT POINT its value "evaporates". But
it is not an expense like food you buy AND CONSUME. More like food you
bought, stored, and COULD resell.
WHO receives those "rents" is in question, and where the continuing
value comes from. You COULD sell that right. However most of us annuity
holders retain our annuities so I am not recommending marking down to
market as you age. Let it all disappear when you die (or both of you if
on more than one life)
Michael D Novack
PS: I was a senior systems analyst/senior business analyst for one of
the world's largest life insurance companies, so very much my line of
country. There are a lot of other insurance products where valuation is
conditional. Insurance is all about conditional events.
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