My mother will inherit a Tax Deferred Annuity from my recently deceased father. It was with Mutual of America.
The total balance of the annuity is approximately $216K.
My father was receiving an annual distribution (is that the correct term?) of $11,500 or so in the third quarter of each year (from what I see in his records).
Is there a typical manner with which TDAs are addressed after death? Are they fully distributed as a lump sum because the annuitant is deceased? Or are the annual payments ever continued in the beneficiary's (my mother's) name?
Not counting the annuity, I am seeing that my mother's monthly income will drop from $5800 to $3500
I am estimating this decrease based upon the idea that she will now receive his SS only, and because his pension was a 50% joint and survivor pension (so going from $2612 to $1306?). Am I correct?
So I am looking to make sure that she has a regular income to ensure she can manage her expenses. It would be great from a simplicity standpoint if she can manage to pay her monthly expenses (~$3K) from her monthly income (~$3.5K). But I am not sure I have a full grip on her expenses yet, although I have been paying their bills for December trough February, so I do have a good estimate. Monthly income from the TDA, if those payments would continue (and could be changed from annual to monthly), would help give her a buffer.
Note: I do know that her RMDs will be sufficient to cover just anything that she may need to consider (except if she ever needs significant nursing home care herself). I am just very new to what TDAs are all about, and I cannot get a good grasp on the likely options from what I am reading online). Thanks for your advice.
The total balance of the annuity is approximately $216K.
My father was receiving an annual distribution (is that the correct term?) of $11,500 or so in the third quarter of each year (from what I see in his records).
Is there a typical manner with which TDAs are addressed after death? Are they fully distributed as a lump sum because the annuitant is deceased? Or are the annual payments ever continued in the beneficiary's (my mother's) name?
Not counting the annuity, I am seeing that my mother's monthly income will drop from $5800 to $3500
I am estimating this decrease based upon the idea that she will now receive his SS only, and because his pension was a 50% joint and survivor pension (so going from $2612 to $1306?). Am I correct?
So I am looking to make sure that she has a regular income to ensure she can manage her expenses. It would be great from a simplicity standpoint if she can manage to pay her monthly expenses (~$3K) from her monthly income (~$3.5K). But I am not sure I have a full grip on her expenses yet, although I have been paying their bills for December trough February, so I do have a good estimate. Monthly income from the TDA, if those payments would continue (and could be changed from annual to monthly), would help give her a buffer.
Note: I do know that her RMDs will be sufficient to cover just anything that she may need to consider (except if she ever needs significant nursing home care herself). I am just very new to what TDAs are all about, and I cannot get a good grasp on the likely options from what I am reading online). Thanks for your advice.
Statistics: Posted by BogBod — Sun Feb 18, 2024 8:10 pm — Replies 3 — Views 283
