Understanding Annuities – A Complete Guide

An annuity can provide both guaranteed income throughout retirement and spousal protection after death.

These unique investment vehicles can remove financial uncertainty and provide guarantees for the future. 

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If you’re worried about outliving your money, and like the idea of guaranteed income throughout retirement, we strongly suggest exploring your annuity options with one of our independent agents. 

Our services are free. And there’s no obligation when speaking with an agent. Fill out the form on your screen to get started. 

Annuities Explained

What is an Annuity?

An annuity is a personalized investment vehicle that can guarantee income throughout retirement. Often for the rest of your life.  In exchange for premium payments, an annuity contract guarantees income payments in the future. There are many ways to customize these products to fit your retirement plan.   

How Do Annuities Work?

You purchase an annuity through a series of premium payments made to an insurance company. The company invests and grows your money for a defined period of time.  The funds are then redistributed back to you in the form of scheduled income payments.  These income payments can guarantee income throughout regiment and even for the rest of your life. 

Annuity Quotes & Illustrations

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Different Types of Annuities

There are two main types of annuities, immediate and deferred. Both of which can have either fixed or variable interest rates. 

Do You Need Income Now Or In The Future?

Immediate Annuities form through a single, one-time premium payment and provide immediate retirement income. 

Deferred Annuities allow you to build up your investment over time through a series of premium payments.  Distributed income payments will begin up one the complete of your annuity investment.   

Annuities Further Differentiate By Interest Rates.

Are You Looking For Safety or Growth?

Are you looking for a secure investment vehicle with little to no risk? Or are you seeking an investment with real growth potential? An annuity allows you to control your risk by choosing your interest rate. 

Fixed Annuities provide a guaranteed fixed rate of return on your investment.  In other words, you know exactly how much your money is guaranteed to grow before you make the investment.  These products are considered an ideal low-cost retirement investment. 

Variable Annuities provide a variable rate of return typically based on stock market performance.  These products have the potential for higher yields and can help you catch up financially if you’re behind on your retirement savings. 

Do You Want Your Investment In Or Out Of The Market?

Indexed Annuities place your funds inside a stock market index such as the S&P 500 or the Dow Jones index.  Your investment grows based on the performance of the index.  Typically, indexed annuities offer variable rates of return. 

Non-Indexed Annuities provide fixed or variable rates of return while keeping your fund sheltered from market exposure.

An Annuity Investment Can Help You Live A Successful Retirement 

While you can purchase an annuity at any age, retirement annuities provide additional tax advantages that help you maximize your retirement income.

Retirement Annuities allow you to make your investment with pre-taxed funds. Meaning you don’t pay taxes on your investment until you being taking income payments.  This benefits allows your money to grow at a faster rate and can help you reduce your tax obligation in the future.  

There are two types of retirement annuities.

Qualified Annuities receive special tax advantages for being a part of a qualified retirement plan.  These products allow you to delay paying taxes to help you grow more retirement income. 

Non-Qualified Annuities are outside of a qualifying retirement plan and therefore do not have any additional tax advantages.  You make premium payments with post-taxed dollars and only pay taxes on the capital gain (growth) of your investment. 

Annuity Investments Continue To Grow In Popularity

Did you know that nearly half (48%) of investors own an annuity? And nearly two-thirds, 63%, of advisers recommend annuities to clients who need income.

Americans approaching or already within retirement face financially challenges on all fronts. The rising cost of living, medical expenses, inflation, and economic volatility put strain on your financial nest egg.

An annuity can protect your retirement savings and offer guaranteed lifetime income.  The financial crash of 2008 was a reminder of the importance of understanding the risk involved in retirement investing.  Since then, annuities have become an attractive investment vehicle for individuals looking for to escape market volatility.

Review of Annuity Benefits

  • Tax advantages to help you grow & keep more money throughout retirement 
  • Guaranteed income for the rest of your life
  • Flexible ways to fund and customize your investment
  • A low-risk investment vehicle with the potential for real growth
  • Can extend your Social Security benefits 

Finding Your Best Offers

In case you didn’t know, annuities are insurance products. Therefore, they are sold by insurance companies and through licensed independent insurance agents.

It’s important to know that not all insurance agents are the same. Many agents are captive and can only offer the product of the company they work for.  Independent agents on the other hand are not bound to any single carrier. They help you shop and compare annuity companies side by side to find your best investment opportunities.

Smart shoppers will save both time and money by working with an independent agent. 

Here at Simplified Senior, we specializes in retirement investing.  We’re here to help answer all of your annuity question and also help shop and compare your investment options.  We’ll help you maximize your retirement income and your retirement lifestyle.

We’ve helped thousands of seniors live a successful retirement. And we’d love to help you too!

Explore your options today. Fill out the form on yours screen to get started.

Annuity Quotes & Illustrations

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