My parents are both in their 80's. Dad's health is failing and Mom is hanging in there. They own their home, lbtm, and have long term healthcare.
About 7 years ago, they purchase a fixed and variable annuity. The fixed is coming due and the VA has two years left. The fixed annuity is paying just above 3%. There is about $10,000 in this account.
The VA has $90,000 -- I believe they can get a better return without paying the expense and insurance costs. There are 2 years left. If they move the money now, they incur a back-end fee of ~$5500.
They met with a financial planner who I trust and he has recommended moving the fixed annuity into CDs, paying 5 1/2%. What to do with the VA is more troublesome, especially with a exit fees. Even with this back-end fee, he is suggesting a balanced MF and CD with a target of 8%.
I believe my parents should be able to move some of the money out of the VA cost-free based on the age of the VA; 5 years . I think you transfer the funds you can move cost-free to the balanced MF/CD and leave the rest in the VA. In 2 years when the VA comes due, then move the remaining into the MF/CD account.
Any suggestions greatly appreciated.
dwk
About 7 years ago, they purchase a fixed and variable annuity. The fixed is coming due and the VA has two years left. The fixed annuity is paying just above 3%. There is about $10,000 in this account.
The VA has $90,000 -- I believe they can get a better return without paying the expense and insurance costs. There are 2 years left. If they move the money now, they incur a back-end fee of ~$5500.
They met with a financial planner who I trust and he has recommended moving the fixed annuity into CDs, paying 5 1/2%. What to do with the VA is more troublesome, especially with a exit fees. Even with this back-end fee, he is suggesting a balanced MF and CD with a target of 8%.
I believe my parents should be able to move some of the money out of the VA cost-free based on the age of the VA; 5 years . I think you transfer the funds you can move cost-free to the balanced MF/CD and leave the rest in the VA. In 2 years when the VA comes due, then move the remaining into the MF/CD account.
Any suggestions greatly appreciated.
dwk