BRYN MAWR, Pa., June 30, 2006 (PRIMEZONE) -- It's no secret that the cost of college tuition -- at both state schools and private schools -- is skyrocketing well in excess of inflation, and some studies show that three-quarters of all grandparents contribute to their grandkids' college funding.
Here's how one couple from Clearwater, Florida, dealt with this issue.
The couple had a deferred annuity with an account value of $85,000, but when they went to the insurance company that sold them the policy to liquidate it, they discovered that they had to "annuitize" the policy for a minimum of five years to get that full value; this meant that, unless they took the money out in a stream of periodic payments that stretched for at least five years, the cash value they could extract from the policy would only be $63,000 (a penalty of 26%). They didn't need or want the monthly payments for themselves, and they wanted to access the full value now so they could help with their grandkids' current college expenses.
The couple heard about J.G. Wentworth's Annuity Purchase Program through a friend, and they were able to sell the policy to J.G. Wentworth for $71,000. This is just a matter of putting a fair market value on a (long-term) annuity asset and creating a competitive environment where the consumer can go with the best offer for that asset. Prior to learning about the Annuity Purchase Program, most individuals believe they have no ability to get money out of their annuity, or they believe their only option is through the insurance company with whom they hold the policy. Through the Annuity Purchase Program (www.jgwannuities.com), investors gain back control of their annuity assets and have much more flexibility to adapt to life's changes.
This consumer tip aired on the Annuity Watchdog with Brian Powell program on AM 860 WWDB, the exclusive financial news and information station for the Philadelphia market. For more information about WWDB or the Annuity Watchdog with Brian Powell program, please go to www.wwdbam.com.