Annuities aren't one-size-fits-all. That's why it's important to learn how they work.
What is Annuity?
An annuity is a financial product typically used by investors to save tax-deferred for retirement or to generate regular income payments, helping to replace a paycheck in retirement. Annuities are insurance contracts whose payments are guaranteed by the company issuing the contract. At its most basic level, an annuity has been designed to increase your financial security as you begin your golden years. You pay a premium to a financial institution, and in time you are repaid in either a series of payments or one lump sum.
Obviously Annuity is a long-term, tax-deferred vehicle designed for retirement. Earnings are taxable as ordinary income when distributed and may be subject to a 10% additional tax if withdrawn before age 59 1½2.
Obviously Annuity is a long-term, tax-deferred vehicle designed for retirement. Earnings are taxable as ordinary income when distributed and may be subject to a 10% additional tax if withdrawn before age 59 1½2.
The Benefit of Annuity
Annuities are tax-advantaged, meaning taxes can be deferred as they grow. When it comes to variable annuities, you can also receive a death benefit in case you pass away before receiving payments. For fixed index annuities, your money is tied directly to a financial index and has flexible interest rates. Furthermore, compared to other kinds of investments, these may better protect your money from major stock market risks.
What's an Fixed income annuity?
Fixed income annuity is an insurance contract that provides you with a guaranteed income for life. You invest a lump sum, give up access to your money, and in exchange you receive a monthly income – for your life and, if you choose, for the life of a beneficiary. The income will continue no matter how long you live. And what's more, the income is guaranteed and so doesn’t fluctuate with the financial markets. An income annuity provides guaranteed income in retirement. You trade a portion of your retirement assets in return for guaranteed income, which is based on your lifetime or the lifetimes of you and another person, or for a fixed period of time. You have the flexibility to choose how much income you need and when you'd like your income to begin.
Would you like to Retire with a paycheck? Of course You can with an annuity
When you stop working, you can still get "paid." Fixed income annuity offers a steady source of income.
Would you like to Retire with a paycheck? Of course You can with an annuity
When you stop working, you can still get "paid." Fixed income annuity offers a steady source of income.
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