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URL:  http://boards.fool.com/for-clarification-let-me-restate-life-annuities-25569913.aspx

Subject:  Re: Income Planning Assumption Date:  6/8/2007  12:01 PM
Author:  BruceCM Number:  57822 of 75776

For clarification, let me restate:

Life annuities do not have organic growth. Guarantted 'death benefits', inflation growth, period certains or joint-life...all of these are funded through adjusting the monthly payment amount.

If you understand Time Value of Money, you'll understand that the present value of every conceivable combination of payouts will be less than the present value of a simple life annuity.

In other words, there's no free lunch.

BruceM
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