Understanding Annuities – A Complete Guide
Some people are looking for guaranteed income that lasts a lifetime; others are looking for spousal protection after death. An annuity can achieve both.
This personalized investment vehicle can remove financial uncertainty and provides income guarantees for the future.
Are you worried about outliving your money?
Even the best financial plans can fall short due to unexpected life events.
If you’re unsettled about the uncertainty of your financial future, an annuity may be the ideal product for you.
We’re here to help you explore your options and help you live a successful retirement.
Fill out the form to explore your options today.
An annuity is a financial contract between you and an insurance company. These contracts can seem complicated, and sometimes they can be, however, the basics are very straightforward.
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 can guarantee income payments in the future. There are many ways to customize these products to fit your retirement plan. And our team is here to help you do just that.
How do annuities work? Your purchase an annuity through a series of premium payments made to an insurance company. The company then invests and grows your money for a defined period. Your investment funds will grow at either a fixed or variable interest rate. And at the end of the agreement, your funds are redistributed back in the form of income payments.
Types of annuities – There are two main types of annuities, immediate and deferred. Both of which can have either fixed or variable rates. These investments further differentiate by placing your funds either in or out of the stock market.
Do You Need Income Now or In The Future?
The answer to this question will help you determine which investment is best for you.
Immediate annuities form through a single, one-time premium payment and provide immediate retirement income.
Deferred annuities allow you to purchase your investment over time through a series of premium payments. Income payments will begin upon the completion of the annuity purchase.
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?
Fixed annuities provide a guaranteed fixed rate of return on your investment. Meaning you will know how much your money is guaranteed to grow before you invest. These products are considered an ideal low-risk investment and can fit any financial plan.
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.
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Place Your Annuity Funds Either In Or Out Of The Market
Indexed annuities invest 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 indexed. Typically these products offer variable rates of return.
Non-indexed annuities provide fixed or variable rates of return while keeping your funds sheltered from market exposure.
Annuities For Retirement
Retirement annuities provide additional tax advantages and help you maximize your retirement income. These retirement investments delay your tax obligation until you being taking income payments. Pre-taxed funds allow your investment to grow at a faster rate.
Qualified annuities receive special tax advantages by 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 doesn’t grant additional tax advantages. You make premium payments with post-taxed dollars and only pay taxes on the capital gain (growth) of your investment.
Find out more about Qualified vs. Non-Qualified Annuities.
Annuities are Growing in Popularity Among Seniors
Seniors in America are facing financial challenges on all fronts. The rising cost of living, medical expenses, inflation, and economic volatility are all strain your financial nest egg.
An annuity can protect your retirement savings and offer guaranteed lifetime income. Securing predictable income will bring peace of mind to anyone worried about outliving their savings.
The crash of 2008 was a reminder of the importance of understanding the financial risks of retirement investing. Since then, annuities have become an attractive investment vehicle for people seeking to escape market volatility.
Review of Benefits
- Tax advantages to help you 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
How To Purchase An Annuity
Annuities are insurance products. They are offered and sold by insurance companies. Therefore you can make this investment through any licensed insurance agent.
Keep in mind that all insurance agents are not the same. Many agents are captive and can only offer one carrier’s products. Independent agents from SimplifiedSenior are not captive and can help you find your best investment option regardless of carrier.
Finding Your Best Annuity Offers
There are dozens of insurance carriers across the country for you to shop. However, shopping alone will likely lead to frustration and headache.
Savvy shoppers will work with an independent agency to help them shop and compare annuity companies nationwide to find the best rates and investment opportunities.
Our independent agents are here to help you maximize your retirement by helping you find your very best market offers.
We’ve helped thousands of clients maximize their retirement, and we’d love to help you too!
Get Started today with your personalized illustration.
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