Annuities are like other financial assets. Often times, litigation efforts and creditors are able to gain access to them. As a result, the money you worked hard for is at risk.
Protect Your Annuities
O.J. Simpson & Florida Exemptions For Annuities
Remember O.J. Simpson? I’m not talking about the notorious car chase in the Ford Explorer. According to MarketWatch, O.J made some poor financial decisions in Vegas. Consequently, those decisions led to lawsuits that ordered him to pay back creditors. O.J. put most of his money in annuities in south Florida where he lived at the time. Lucky for him, statutes in the state of Florida shielded his annuities from being touched by creditors. “If the glove don’t fit, you must acquit” may as well be, “If annuities hold your cash, you’ve protected your own a$*”. You get the picture.
Florida is one of the states that many business owners, physicians and wealthy investors choose to invest, as 100% protection is offered by the state’s annuity laws. In fact, Florida state law protects your home once it is paid off in full. This means that if you’re ever sued, or creditors attempt to collect your debt through he seizure of assets, they cannot touch your home or your annuities. Yet, many annuitants don’t know the laws of their state.
Plan For The Worst, Hope For The Best
Why is protecting your annuities important? You can never really plan when you’re going to be sued. However, IRA’s and retirement planning can protect your assets. How? Your retirement plan is protected under federal law even when filing for bankruptcy! Do I have to spell it out for you? Find out if you live in one of the states that protect your annuities!
Which States Offer 100% Annuity Protection?
Some states offer 100% creditor protection. Arkansas, California, Florida, Georgia, Hawaii, Indiana, Texas and Louisiana offer 100% annuity exemption. Maryland, Michigan, New Mexico, Ohio, and Oklahoma do as well. Kansas exempts annuities that have been maturing for a year or longer. Tennessee allows annuity protection from creditors only if it’s part of your retirement plan.
Some states allow an exemption only if you have beneficiaries such as a spouse and/or children. New York exempts only a decided amount after a “due and proper amount” is paid to the creditor(s). Furthermore, states such as North Carolina, New Hampshire, Mississippi, Maryland and Connecticut offer no annuity protection from creditors at all. Statutes are different from state to state. As a result, you have to know if you are protected.
Your Guide: Which States Protect Your Ass-ets
Finally, you have to consider your beneficiaries. Your spouse and children may depend on your assets in case of medical emergencies, or a college fund. In addition to living in a state that has fair statutes for your annuities, you may also want to learn about the different kinds of annuities. While your bank may offer some insight, it’s better to know for yourself from a source that doesn’t have a vested interest in your investment. Read my blog on fixed indexed annuities for details about the most popular annuity that consequently gives you the highest interest. Use this as a guide to check the statutes in your state.
