Annuities

For most individuals, retirement planning is largely a self-directed exercise. Once we set up our 401(k) and IRA accounts, we are responsible for deciding what to invest in, how long to hold those investments, and how to change our investment strategies over time. Even if we solicit help from an investment advisor, the decisions we make within these types of accounts are our own. But there’s also another retirement related investment product that doesn’t require the same degree of decision-making on our part – the annuity. There are different types of annuities available, so here are some terms and retirement...

Read More »

When individuals come up with a long-term retirement plans, individually managed accounts such as IRAs and 401(k)s are likely to make up most, if not all, of their planning. These accounts are certainly essential to long-term success as they provide sizable tax benefits; in the years in which contributions are made, while the accounts are active, and sometimes even when funds are withdrawn (in the case of Roth IRAs). But some investors don’t want the burden of having to make all the investment decisions themselves. This is where using a fixed annuity for retirement savings can provide significant benefits. Here...

Read More »

There are many different types of financial products an individual can use to accumulate wealth to use during their retirement. IRAs, 401(k)s and traditional brokerage investing accounts usually comprise the backbone of most individuals’ retirement savings plans. But this is not a complete list of options that are available. One lesser known retirement savings product is the annuity. Annuity Basics. Unlike investing in stocks or mutual funds or bonds, an annuity is actually a contract between an individual and a life insurance company. The basic structure of an annuity contract is for the individual to make one or more payments...

Read More »

Many people have likely heard of annuities when they’ve done research about their retirement planning. But there’s a good chance that not everyone fully understands what annuities are and how they can play a significant role in an individual’s retirement planning. In essence, an annuity is a financial contract between you and an insurance company. In exchange for a single payment or a pre-determined series of payments, the insurance company agrees to provide you with certain benefits once you reach retirement. There are some choices you must make regarding how you want your annuity to be paid out once you...

Read More »

Annuities continue to be quite popular as part of an overall retirement plan. This insurance-based product provides many benefits that retirees find very desirable - most importantly a potential lifetime income stream. Here is some advice about how an annuity can potentially fit into your overall retirement plan. Two important benefits of annuities are deferral of taxes and the ability to put large sums of money into an annuity. You can buy an annuity with much more money than is allowed annually in a 401k plan or on IRA. Annuities also offer a number of different payout options that...

Read More »

The annuity is a very unique type of investment. Instead of a bank or stock broker, investors obtain annuities through an insurance company. And while annuities have certain things in common with life insurance, they are not the same thing. They offer low risk while providing an opportunity to receive guaranteed income for a given number of years, or even for the rest of your life. Annuities come in many different flavors. There are immediate annuities, which begin immediately after the annuity is purchased, and deferred annuities, which may begin years or decades later. Fixed period annuities pay out for a...

Read More »

Annuities are life insurance contracts sold by brokers, insurance companies, and other institutions. They are normally bought as a way to invest toward one's retirement. Because it is paid for before a person retires, they can look forward to receiving lifetime payments. If you’re considering getting them, here are the pros and cons of annuities. Those concerned with their financial future following retirement know they can’t expect the same type of employer-sponsored pensions that their parents enjoyed. Their only option has been to find other means of saving and one of those options is annuities. The Pros: Prepaying for annuities before retirement...

Read More »