Problem
Your client Marsha currently has a variable annuity with Vanguard with a balance of $700,000. She was just notified that they will no longer be offering these products. Marsha is interested in moving her annuity to Fidelity. Marsha's birthday is 1/1/1963. She will be working until she turns 67 in 2030. Assume she is single and has no dependents. She wants enough money to last her remaining lifetime. She is concerned about inflation which she is estimating will run 2%. She wants your help in answering the following questions:
i. How should she go about moving her annuity to Fidelity and what are the tax implications of the move?
ii. What annuity product do you recommend that she uses for the next few years while she is still working? Be specific on the exact insurance product not just the type.
iii. What annuity product do you recommend that she uses once she starts withdrawing money at retirement? Be specific on the exact insurance product not just the type.
iv. What will her monthly annuity retirement check be at retirement?