Debating Annuities
Although very popular in its many forms, the annuity isn’t for everyone.
Interest in these stalwarts of the financial services industry has exploded in recent years. The aging of the population, the decline and disappearance of pensions, equity market upheaval and innovative annuity product design are all contributing factors to the billions of dollars flooding in to these insurance products. So why can’t you have one? We’ll explore that question and give you insight in to what is going through your financial professionals mind as he evaluates your interest or request for an annuity.
Annuities, Annuities, Everywhere
There are many types of annuities, but we will do a deeper exploration of the fixed annuity. These annuities are contracts with insurance companies with no investment in equities, (simply meaning no mutual funds or any type of security). They pay a rate guaranteed for one year and then renew yearly at a rate the insurance company declares.
Here Are Some Other Types of Annuities:
Multi-Year Guarantee Annuities Sometimes called Certificate of Deposit (CD)-type annuities that pay a guaranteed rate for a guaranteed period, usually ranging from one to 10 years.
Indexed Annuities: These credit interest by tracking, but not participating in different indices, the S&P 500 being one of the most popular. '
Immediate Annuities: These may pay a lifetime income, an income for a defined period, or a combination of the two based on your age and the amount of money contributed.
Annuity Research, Annuity Smarts
If you are researching current annuity rates as a consumer you may have heard about some of the great features and benefits an annuity delivers.
Some of The Most Obvious Advantages:
- Safety
- Tax Advantages
- Competitive Rates of Return
- Probate Avoidance
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