What is a Joint and Survivor Annuity?

When it comes to investing in an annuity plan, the purchaser looks for something that not only financially secures his life after retirement, but also ensures regular payment to his spouse after his death. And there the need of buying a Joint and Survivor annuity comes into play.

What is a Joint and Survivor Annuity?

A Joint and Survivor Annuity, also known as a Qualified Joint and Survivor Annuity, is typically bought by a married couple. It can be defined as an insurance tool that ensures to provide regular payment (usually monthly) until one of the spouses is alive. In other words, this is a special type of annuity which is especially designed for the married couples who want to assure that the surviving spouse would get payment for rest of his/her life.

How does a Joint and Survivor Annuity work?

The money paid in such an annuity plan is generally invested in a varied portfolio of financial apparatus and the income from such investments continues to be disbursed to the surviving annuitants.

Such annuity plans are sometimes referred as life annuity plans, as they ensure payment until either of the annuitants is living. And here a Joint and Survivor Annuity contrasts to other types of annuities. Most of the annuity plans pay out for a particular period of time agreed upon by the annuitant and the insurance company, irrespective of whether or not the annuitant is alive. That is why couples, who want to ensure the surviving spouse getting regular payments for his/her lifetime, opt for a Joint and Survivor Annuity.

What are different types of Joint and Survivor Annuity?

The most common and popular types of Joint and Survivor Annuity are a joint & one-half annuity, and a joint & two-thirds annuity.

1. Joint & one-half annuity – In this type of annuity, the payment is reduced to one-half of the actual payment followed by the passing away of one spouse.

2. Joint & two-thirds annuity – In this type of Joint and Survivor Annuity, the payment is reduced to two-third of the original amount after the first annuitant dies.

What is the rule regarding payment to surviving annuitant?

There is a specific rule regarding how much payment can be made to the surviving annuitant after the death of the first annuitant.

· After the death of first annuitant, the surviving annuitant would get no more than 100% and no less than 50% of the annuity amount paid during the purchaser’s life.

What is Qualified Optional Survivor Annuity?

Qualified Optional Survivor Annuity, also known as QOSA, is a provision for which the surviving annuitant may opt for after the death of first annuitant. According to this option, the amount payable to the surviving spouse will be equal to pre-set percentage of the actual annuity amount payable during the purchaser’s life.

These are just the fundamentals of Joint and Survivor Annuity. For more information and expert advice, one may need to talk to a qualified annuity agent.

Author’s Bio –Jonny is a regular annuity and insurance blogger. He is a regular contributor to Mypensionexpert.co.uk.

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Sweet Home Alaska: An Affordable Cruise Vacation

(Photo credit: Wikipedia)

It’s important, even for those of us on a budget, to get out and see the world. A cruise can be one of the most sensible and convenient ways to cover a whole lot of...well, not ground, but sea. You pay one flat price that covers transportation and lodging (since they’re the same), plus food, which these days is usually excellent. So while you’re away from home, you only have to pay out of pocket for drinks, souvenirs, and other incidentals. This makes for a marvelous trip because you have the peace of mind that comes with leaving your money worries behind.

Most of the time, though, when we think about cruising, we picture a voyage through tropical Caribbean or warm Mediterranean climes. While there’s certainly nothing wrong with a balmy island getaway, the cruise industry does offer a much wider geographical diversity, including the unfamiliar resort cities of the Black Sea, the fjords of Scandinavia, and a thriving tourist trade on the coast of Alaska. This latter destination was where I ended up a few years ago, and it was an experience I’ll never forget.

Our cruise departed from Vancouver. It was my first opportunity to visit this city, famed as one of the best places in the world to live, a beautiful jewel among cities. I only had 24 hours to see it, but I had to agree. As our ship set out from Burrard Inlet, we saw the city grow smaller and smaller against the gorgeous natural backdrop of British Columbia.

The Veendam, our Holland America vessel, was headed up through the Inside Passage, whose waters are kept calm by being sandwiched between the mainland and the archipelago of islands along the coast of B.C. and Alaska. In this peaceful wilderness it did not take long to spot bald eagles and tantalizing glimpses of whales.

We also took this first day at sea to explore the ship itself, with its multiple dining options (sit-down, buffet, or fancy restaurant with a surcharge), fitness center, gaming room, cooking classes, theatrical shows, and a spa where I had a rejuvenating massage. Alaska cruises, as you might expect, don’t exactly draw the Spring Break party crowd. The activities were more geared to a mature audience, which is not to say they weren’t fun.

Our first port of call was Ketchikan, which with a population of around 14,000, is still the fifth-largest city in the (geographically) largest U.S. state! It’s known for its salmon fishing, totem poles, and the Misty Fjords National Monument. We took a morning floatplane excursion over the fjords, which would have been amazing...if I hadn’t had too many cocktails the night before.

After I managed to get back to the hangar without using my motion sickness bag, we re-boarded the ship and headed for Juneau. Juneau is tiny for a state capital, easily walkable, but so hilly that many “streets” are actually stairways. The postman must be in great shape. We went on a packaged day trip in Juneau that included an incredible whale-watching excursion and a stop at the impressive (but shrinking) Mendenhall Glacier.

My favorite city, though, was Skagway, where we stopped next. This was a boomtown of the 1898 Klondike Gold Rush, and its authentic Wild West appearance is preserved by the National Park Service. The White Pass & Yukon Route Railroad is the highlight: built too late (at a cost of many lives) to reach the Yukon Territory before the rush had peaked, it nevertheless remains a world treasure, providing a breathtaking scenic experience over a century later.

Our next two days were spent at sea in Glacier Bay National Park, which truly must be seen to be believed. Alaska is just so much wilder and bigger than any place I’ve ever been. The glaciers “calve” before your eyes, dropping chunks of ice the size of cars into the sea below.

We disembarked for good at Anchorage, the state’s largest city by far, home to more than 40% of its population. It was funny to be back in civilization, with its strip malls and high-rises. In our day in Anchorage we saw a beautiful light show about the aurora borealis, a rather awesomely cheesy theater-shaking show about an earthquake, and the impressive Anchorage Museum at Rasmuson Center, which covers all of Alaskan history from its huge diversity of First Peoples (literally the first people to come to America, through the Bering Strait), to the underestimated Russian colonial influence, to Alaska’s modern importance in the Cold War and the energy industry.

As fascinating as this anthropological material was, the history of man in Alaska immediately shrank into insignificance as our plane took off at sunset. The twinkling man-made city of Anchorage was soon gone and all we could see were mountains, mountains for a thousand miles, mountains each bigger than any I’ve ever seen, but so many of them that it beggared the imagination. This is Alaska. If you want to be seized with a sense of awe at the majesty of creation, I can recommend no cruising experience more highly.

Tracy Myers writes about finance, travel, and education issues at sites such as www.homeinsurance.org. When not out exploring the Arctic Circle, Tracy likes to stay home with her two Shetland Sheepdogs and a big mug of coffee. She welcomes your questions and comments!

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Paul Merriman's Book - First Time Investor: Grow and Protect Your Money - Review

Investing for retirement can be one of the most confusing jobs we have to deal with in our financial lives. It not only confuses people, it also scares them to death when they see their investments declining in a down market. The only way to overcome these impediments is to have a good solid plan. With all the different voices out there, with conflicting advice, who do you listen to? There is a new book out that explains, in plain English, how to do it right. 

The "How To Invest" series - "First-Time Investor: Grow and Protect Your Money" by Paul Merriman with Richard Buck is Merriman's latest book on educating young and old on how to invest and handle their money. The title of the book says "First Time Investor" in big bold type. This is one of the things that I like about Merriman's continuing goal of helping the new and equally confused investor. 

The first thing I wanted to do with the book was to dive in and get to the meat and potatoes of where to put those investing dollars. I was surprised to find the first half of the book teaches the many foundational things you needed to learn before investing any money. It reminded me of when I read Paul Merriman's last book, "Financial Fitness Forever". Merriman is a teacher at heart. He wants you to be educated as to the reasons things work the way they do. Just listening to an author and following a to-do list leads to failure. Knowing why and really understanding why you are investing in a certain way, with certain investments, keeps you on track when the markets are going crazy. The average investor does great when markets are doing well. It's knowing what to do when the markets are in turmoil and your afraid of losing you hard earned dollars. 

Book Review - Financial Fitness Forever: 5 Steps to More Money, Less Risk, and More Peace of Mind by Paul Merriman

The book is an easy read of a 114 pages. It's divided into 11 chapters and each chapter divided into easy to read and understand topics. As you will find in all of Merriman's books this book also has data, figures, and illustrations backing up what the author talks about. Whether Merriman is explaining 401(k)'s, mutual funds, or bonds you will always find the data to back up the information.

Why listen to Paul Merriman?

Paul Merriman has been advising people on how to manage and invest their savings for over 30 years. He believes it's necessary to explain the risks, mistakes, and stumbling points many investors will encounter. He explains the good, the bad, and the ugly so you can make informed investing decisions. His many years of meeting with clients and putting together investment plans has given him the knowledge and a passion for helping people learn how to be successful investors. 

Who is this book for.

While reading this book I come across many things I already know and many things I didn't. But I consider myself well read on the subject matter. But this book is for the new investor as well as the old. You won't be overwhelmed or bored. The new investor will learn what to do before even putting one dollar into an investment and shown the best places to invest. The young will gain a firm foundation for investing. The seasoned investor can compare notes and learn a thing or two. 

I recommend you get this book because if want to learn where you should invest your money you will get that knowledge and more in this book. You can purchase the book on Amazon.com or at PaulMerriman.com where digital copies in a variety of formats are available for all your electronic reading devices. 

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Private And Public Sector Organizations Prefer Direct Debit

The rise in popularity of online banking has led many British consumers to abandon traditional payment methods, such as cash or cheque, in favor of automated payment methods, such as direct debit. As a result, many organizations have had to expand the range of payment options they offer.

Flexibility

According to one estimate, over 3.3 billion direct debit payments were processed in 2011, an increase of two-thirds o the number processed ten years earlier. One of the reasons direct debits are becoming widely accepted is their flexibility. 

They are ideal for ach payment processing of the same or varying amounts on the same or varying collection dates. They are also less expensive, in terms of transaction costs, than traditional payment methods, including credit cards. 

They are also immune to the effects of unexpected events, such as postal strikes, which can play havoc with payment methods that rely on paper. Their only real drawback is that they are not suitable for one-off payments.

Efficiency

Public sector organizations are always looking to improve their efficiency as an alternative to making job cuts. As a result, many public sector organizations, including local councils, the Driver and Vehicle Licensing Agency (DVLA), and TV Licensing, now offer direct debit as a payment option for Council Tax, business rates, commercial and domestic rent, road tax, and many other recurring payments. In fact, many private and public sector organizations offer discounts to encourage consumers to pay by direct debit.

Direct Debit Guarantee

Direct debits for the public sector ensure both parties that bills are paid on time. If a direct debit payment fails, both the payer and payee find out quickly and can take prompt action to rectify the situation. 

Furthermore, the Direct Debit Guarantee entitles consumers to a full and immediate refund if an error is made in the payment of a direct debit from their bank or building society account, regardless of who actually made the error. 

Direct debits can only be set up for payments to approved payees, who are subject to rigorous quality control procedures and must provide indemnity guarantees through their banks, so unscrupulous organizations cannot take payments that are not due to them.

Direct Debit Versus Standing Order

Over 75% of British consumers already pay their Council Tax by direct debit or standing order. The principal advantage of direct debit, however, is that the payee can make amendments to the payment amount without needing to obtain the payer's signature on each occasion. 

The payee must, however, give advance notice, typically 10 working days, of any change(s) to the payment amount and collection date. If the collection date falls on a weekend or bank holiday, the payee must take the payment after the due date unless they give advance notice. 

Most bank and building society accounts, including some special savings accounts, accept direct debit payments. Banks and building societies retain the details for 13 months from the date of the last payment. 

At the end of this period, known as a dormancy period, the payee must obtain the authority of the payer to continue collecting payments.

AUTHOR BIO

Peter Smith holds a Master's Degree in business administration and has worked extensively in the public sector during his career. He regularly writes about automated payment methods, including direct debits for the public sector and various business-related websites and blogs.

3 Things to Do Before Retirement (Other Than Securing Finances)

Retirement (Photo credit: Tax Credits)

Whether you are prepared financially or not, there’s more to retirement than just having enough money in savings, life insurance and retirement funds to survive after your working days are over. Sure, financial stability is the foundation to a happy, stress-free retirement, but there are a few other things that must be done before you clock out from your last shift on the job.

The following three pieces of advice will give you the peace of mind you need to enjoy a retirement full of fun and relaxation.

1. Pay off debt: Ideally, you should be working toward a zero-debt goal long before you set a definitive retirement date. As a rule of thumb, you should focus on paying off high-interest rate debt first (such as credit card debt), then pay off moderate-interest rate debt (such as car loan debt) and then pay off your low-interest rate debt last (such as your mortgage). Obviously, you want to make regular payments on all of your debt, but whatever high-interest rate debt you can pay off early, find a way to do it. It will help you save money in the long run. Paying off all debt before retirement gets a huge monkey off your back and allows you to quit working free of worry.

2. Retire near family and friends: We’re living in a world where it isn’t always common to reside in the same town (or even region) as your family and close friends. Retirement can be lonely; if you aren’t located near the people you love and enjoy spending time with. If you moved years ago for work (or if your family or friends moved away for work), it may be a good idea to think about moving closer to someone or a group of people you can depend on for help in your older years. A two-hour drive is the longest distance that should separate you from your closest friends and family members. As you grow older, the importance of this point will become clearer.

3. Clean out the house: Preparing your home for retirement is a must. You and your family have probably accumulated a lot of stuff over the years. Some of this stuff may be junk, and some of it may be for keepsakes. Dig through closets, the attic and other storage spaces, and parse out what you want to keep and what you want to give away and throw away. This will save you and your family a huge hassle down the road, because sooner or later, someone is going to have to clean it out. It also frees up space in your home for new uses, like a craft or hobby room.

Retirement is supposed to be fun and free of worry. By making the necessary preparations, you will make more time for traveling and doing the things you always dreamed of doing when you were working.

As a regular contributor to several finance websites, like www.CreditScore.net, Stella Walker uses her knowledge of economics, consumer trends and budgeting to help readers better understand their own personal finance issues. Feel free to leave your questions and comments for her below!

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Insuring Your Teen Driver as an Older Parent

Mark McCrell is an auto aficionado who loves to drive his 1974 Buick LaSabre around town and write about all things auto. He currently blogs for the website AutoInsuranceQuotes, which specializes in cheap auto insurance. 

Of all the benefits and drawbacks of becoming a parent later in life, a strong benefit is that you are most likely more equipped to handle the financial challenges that accompany raising a teenager. This is most true when it comes to adding your teen driver to your car insurance policy. Your greater age and experience are powerful allies to have in your corner for this fight. Here are some tips for surviving adding your teen to your insurance policy. 

You have some good things on your side as an older parent: 

● Your credit score is generally higher 

● You’re more likely to be married, which can lower your premium overall 

● You’ve most likely been with your insurance company for a long time 

● You’re more secure in your financial affairs, including investments and saving 

● You’re more likely to be a homeowner, in which case you can bundle home and auto 

● You’re more likely to have multiple cars under the same policy 

Tips to insure your teen driver for less: 

Give them an inexpensive, safe car 

If you are giving them a car, make sure that it’s a safe car that’s cheap to insure. They may beg for the dragster or the muscle car, but if you put your foot down and get a car that’s safe and reliable, then you can make sure they are safe and save money on insuring your teen. 

Raise their deductibles 

Raise the deductibles on your teen’s policy to $1,000 more. They are almost sure to have a few small dings and scrapes along the way and if you don’t have to file a claim for every paint scratch, then you will save money in the long run with a claims free discount. 

Drop the comprehensive coverage 

If your teen is driving an older, or less expensive car, you may want to drop your comprehensive coverage entirely. If your car is worth less than the deductible, then you definitely want to consider dropping it off your policy. 

Continued education 

Enroll your teen in a defensive driving course, or some insurers will send an information packet out or instructional DVD to your teen. If they complete the included material, then you could get another break on your insurance. 

Don’t let your teen modify their car 

Many teen drivers may be in to learning about car modifications that make cars look cooler or driver faster, but these modifications can lead to huge jumps in your insurance premiums. If you modify your car to give it more horsepower or modify the body to make it look “sleeker,” then it could pose a greater risk for theft or vandalism. If your teen wants to help modify a car, just make sure that it’s a friend’s car. 

There are lots of tools in your tool belt as an older parent that will help you to build a better financial future for your teen driver. Make sure you take advantage of your wisdom and experience and turn it into extra money in your pocket each month, just in case your teen wants to borrow money to go to the movies.