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The Benefits of Having a Fixed Annuity

In the US today most of the citizens have an annuity. This can be explained by simply saying that it is a decision that has been taken by many and they have realized excellent results. It is the one life decision that you will always be proud of when you are of old age. However, before we get to the pleasures that you will enjoy at old age lets first look at the very basic benefits of fixed annuity accords you once you have decided to take it up.

RetirementPlanBy taking a fixed annuity, you are taking a very step that will ensure that your retirement age is well catered for. With the government Internal Revenue Code (IRC) you can rest assured that your savings are well looked after. Moreover there is the Financial Industrial Regulatory Authority which is a non-governmental body that regulates the administration of annuities and which ensures that every insurer providing a licensed annuity. It is however, prudent to always check with FINRA if an insurance company is registered. Under the tax deferred annuities code your principal and interest are secured and are always ready for your withdrawal. Furthermore, the monies taken by the insurance company for this annuity are invested in government or secure corporate bonds. Therefore, it is a very safe way of investing.

Whenever you take an annuity, you are always exempted from taxation when paying the premiums. You are only required to pay the taxes on the interest earned not the principal received at the time of the payout. It actually gives you the authority to determine the taxes to pay and at what date since you are the one deciding to draw and at what day. This is besides the plan serving as an ideal normal method of accruing savings as you will be greatly discouraged from withdrawing the principal.

The companies understand that their clients often are caught up in hard situations and they would need to withdraw. This is of course having satisfactorily met the minimum conditions set like having some sufficient funds with the insurance among others.

Finally, unlike other forms of investments a fixed annuity has a more secure investment. Normally when you invest in an annuity the insurance company invests the premiums into government or serious corporate where the returns are sure and steady. The other annuities’ premiums are invested in stocks whose prices keep fluctuating thereby risking ones annuity returns and the annuity plan itself.

Like any savings plan a fixed annuity will attract surrender charge if you claim your money before annuitization. This will also encourage one to be disciplined in to having the annuity mature. Besides, since no tax is being charged on your premiums and interest the compound interest earned gets on being compounded to your advantage. This will not be the case in a normal savings account where your account earns compound interest but the interest is withdrawn every other day.

Selling Your Fixed Annuity: Look before You Leap

Investing in annuities, such as the fixed annuity, is not a “road of no return.” In contrast to popular belief, you can sell your annuity contracts when you find it necessary.

Most annuity owners function think that once they had purchased or inherited an annuity, they are stuck with the annuity until the contract expires. You should know that you could sell your annuity and that today, doing so is a lot easier than it was years ago.

Why You Would Want to Sell Your Annuity

Younger annuity owners generally sell their annuity contracts because they want to get a lump sum payment instead of receiving a monthly income. Because they are still young, they do not have to save for long term goals yet. Older annuity owners, on the other hand, generally do not sell their annuities because they are saving for a long-term goal – that is, saving for their retirement.

You might also want to sell your annuity because you want to purchase a particular asset –like a house. In this case, you might need the amount of money that you can get if you sell your annuity.

Selling your annuity will give you money immediately. Because of this, it can be one of your choices so that you can pay off your debts and current bills.

Selling Your Annuity on the Secondary Market

The secondary market is the market where owned securities are sold to other investors rather than to the insurance company that issued the asset. In the secondary market, the prospective seller of annuity transacts with an interested investor to settle the terms of the purchase. These investors are usually looking to buy annuities at a discounted price or to qualify for annuity payments.

Surrendering Your Annuity Contract

You may also choose to surrender or withdraw your annuity account from the insurance company before the maturity date of your contract. If you do this, however, the issuing insurance company will hold you liable for a particular withdrawal charge. The withdrawal charge is a feature used to protect the investment of the insurance company in you annuity.

Be Guided Before You Sell

Make sure that you get all the necessary guidance and advice before you decide to sell your annuity. Review your annuity contract and weigh the differences in advantages between keeping your annuity and selling it out to interested investors. Compare annuity quotes from various sources. You also have to make sure that your issuing insurance company is willing to work with you. If you eventually decide to sell your annuity, you have to keep in mind that you will not get the full value out of your annuity account.

With all things said, it does not mean that you should sell something just because you are allowed to do so. Before selling your fixed annuity payment and contract, it is of utmost importance for you to review your goals and your expectations before you decide what to do. Be careful in weighing the advantages and the disadvantages of selling your annuity. Remember, once you have sold it, you cannot get it back.

Some deals look great and seem to be too good to be real. Read and review the proposal for several times. Always be cautious when handling transactions.  After all, not everything is as good as it looks. As stated in the title of this article, look before you leap.

LOOK BEFORE YOU LEAP! Compare annuity rates for FREE entering your ZIP at the top of this page. Then answer some basic question about yourself, you financial horizon, and your investment goals. Our partners will provide you different rates depending on your individual circumstances and situation.

The Fixed Annuity through the Centuries: A History

The history of everything is always a matter of importance. For you to understand it better and more deeply, you have to follow it through the paths it has travelled from the day its journey began and up to the day it crossed your own path. So here is a history of annuity to help you understand.

The Roman Times

During the Roman Period, Roman citizens would make a one-time payment to the Roman emperor. In exchange for payment of the citizens, the emperor gives lifetime payments to them once a year. This transaction is made under the contract known as “annua,” a Latin word that means “annual stipends.”

The 17th Century

In the year 1653, a Neapolitan banker named Lorenzo Tonti developed a method for raising money in France. The method was called tontine after his last name. In this savings structure, the clients would purchase shares from a particular company. Each of the shareholders will be given their respective shares from the income generated from the capital investment. As shareholders passes away, their income was spread among the surviving partners. The last shareholder or partner alive would collect all the benefits.

The use of tontines spread to Britain and the United States where governments used them to finance public works projects. The practice of tontine, however, was eventually banned because it created an incentive for shareholders to get rid of their partners so that they would have a higher payout.

The tontine is considered as an early predecessor to the deferred annuity and the immediate annuity. However, fortunately, the income from these two popular investments vehicles would not be shared by other investors in your chosen insurance company. In case you die before the full account value of your annuity plan is given to you, the income will be automatically transferred to your beneficiaries.

In 1693,

The 18th Century

Annuities made their first mark in the United States of America in the 18th century. In Pennsylvania, a company designed to benefit Presbyterian ministers and their families was founded in 1759. The ministers would be given lifetime payments in exchange of the funds that they had contributed to the company.

The 20th Century

It was only in the year 1912 that the public of America were offered annuities. The first company to offer annuities to the general public was The Pennsylvania Company for Insurance on Lives and Granting Annuities.

The popularity of annuities as an investment vehicle started to grow in the late 1930s when individuals were encouraged to avail of products sold by insurance companies due to concerns about the fluctuating condition of the financial markets. This was a period of great depression in America. Because of the recession, Americas were prompted to secure their future. The insurance companies were seen as stable institutions that could satisfy the rate of returns specified in annuity contracts. Annuities greatly benefited from the “saving for a rainy day” perception that spread during the 1930s.

In the year 1952, the first variable annuity was created. Over the years, several features were added to annuities in order to give a wider range of options to consumers. Different types of annuities were created to fit the lifestyle, needs, and goals of every consumer. Some of the added features were enhanced premium rates, maturity periods that range from a year to several years and guaranteed death benefits given to the beneficiaries of the annuity owner in case he/she passed away unexpectedly.

The Annuities Today

Annuity sales are estimated to be more than $200 billion today. They are one of the most popular investment tools, especially for those who are preparing for their retirement.

Start investing your money in the most reliable investment tools that had stood the test of time! Enter your zip on the top of this page, then answer some basic questions to compare multiple providers to find out your highest eligible rate. Answering these questions is important because each of our partners will provide you different rates depending on your individual circumstances and situation.

The Fixed Annuity Calculator: Compute and Consider

Many factors determine the value you get from your fixed annuity. We have defined and described the most important factors for your convenience.

Fixed annuities are the insurance industry’s version of a savings account. It may give you a reasonable rate of interest that is independent on the economic condition and the state of the stock market. It also allows you to postpone your payment of incomes taxes for as long as you want, letting your annuity’s account value to grow faster.

In deciding on the amount of premium that you would have to pay for your fixed annuity, the issuing insurance company takes into consideration the condition of your health and your lifestyle. For example, you will get a high premium if you are a chain smoker. On the other hand, if you are a non-smoker, you will have to pay a lower premium

Here are some terms that insurance companies use to determine the amount of premium you have to pay for your annuity, the length of time you have to give your payments, and the length of time that the insurance company have to provide you with a stable income at regular intervals.

Annual contribution

The annual contribution is the amount you contribute to your annuity each year.

Current tax rate

The current tax rate is the current marginal tax rate you expect to pay on your taxable investments.

Expected average interest rate

The expected average interest rate is the interest rate you would expect to average after the initial interest rate is no longer guaranteed.

Initial interest rate

The initial interest rate is the initial interest rate guaranteed for your fixed annuity.

Minimum guaranteed interest rate

The minimum guaranteed interest rate is the interest rate that is guaranteed after the initial rate has ended.

Pay-out Period

The payout period, also called the annuitization phase, is the phase in which you as the annuity owner or annuitant, start to receive income from your annuity contract. You can choose to receive a steady income that you can rely on for as long as you life. You can also choose to receive income for a fixed number of years according to the payout term you have selected for your annuity contract.

Starting balance

Starting balance is the initial amount that you will contribute to your Fixed Annuity.

Retirement tax rate

The retirement tax rate is the marginal tax rate you expect to pay on your investments upon your retirement.

Surrender charges

Surrender charges are a percent of the annuity balance that you will be charged with if you withdraw your annuity balance before the maturity date specified in the annuity contract is reached. The actual surrender charges vary widely from annuity to annuity and from company to company.

Taxable account’s expected rate of return

The taxable account’s expected rate of return is the annual rate of return you would expect if you deposited this money into a taxable account.

Withdrawal age

Withdrawal age is your age in which you are planning to withdraw your annuity balance.

There are really a lot of things and factors to consider before you decide to buy an annuity. Among these, the first question that you have to answer is this: “Will I be able to use an annuity to my full advantage?” The answer, of course depends on your financial horizons, your lifestyle, your goals, and your investment expectations. Remember that before putting your hard-earned money into an investment, no matter what kind of investment it is, you have to compute the earnings you will gain. As indicated in the title of this article, it is necessary for you to compute and consider.

Compute your possible investment earnings! Enter your ZIP at the top of this page & compare annuity rates for FREE!

Combining Investments In Retirement Planning

Combining investments in retirement planning

As the period of retirement approaches, many people who have not planned for it become anxious and tend to focus on how they will survive for the rest of their lives without an income every month. Usually this is a group of people who have not invested in their retirement and have not even planned about it at all. This is why it is very important for all people planning to retire to make sure that they are well set before retirement catches up with them. But even for those who are investing for retirement there is also need for them to think about investing in multiple avenues so that they can easily be assured of financial security.

One of the ways of ensuring this is by combining several investments. This is a process were by retirees combine various investments such as annuities, mutual funds, stocks and many other sources together In order to create an avenue of wealth. One of the advantages of this is that you are still assured of being able to enjoy your life even if one of these investments has failed to make money for you. Moreover, having several investments allow you the chance to see which ones of these are effective and which ones are not. Combining these investments in retirement planning is a good ideal for everyone who wants to have a good and prosperous future.

When planning about retirement, it is also important to understand that different investments and retirement plans have their own advantages and disadvantages. Thus by being able to combine all these investments into your retirement package, you are able to balance them and thereby increase your retirement funds and safeguard your future. This is essential for all individuals investing with long term goals in mind as it can help you to make lots of profits as time goes by.

So what kind of investments and retirement plans can be combined? Well for all those who would love to know them, there are several investments that can be combined and used in your retirement package. These investments include mutual funds, annuities, stock and even perhaps trying forex exchange business among others. These have the ability to make you lots of profits in different ways when capitalized upon. For example, mutual funds and annuities can assist you to have a steady income each month as you wait for the other investments such as stocks and forex exchange to grow; which in the long run can bring you a lot of money than you would have believed was possible.

Therefore, combining several investments may be a good idea for everyone who wants to advance in life and enjoy it.

To get started, enter your zip code on the top of this page, and then answer some basic questions. This will help you to compare annuity plans from multiple providers for FREE to determine your highest eligible rate. It is important to provide accurate questions to these answers as our pool of providers will provide you with different rates depending on your individual circumstance and situation.

Choosing Annuities For Your Retirement

When people think about retirement what comes to mind are the high costs that this entails. For many people, finding the right investment for their retirement funds is a very difficult thing to do. This is because there are many investment options that are available but either give too little investment returns or are too expensive for many people to afford. Thus, many people choose just to save their money and hope for the best. Such kind of thinking is wrong since saving your annuities and retirement plans funds cannot guarantee you that they will last. It is much better in this case to choose annuities as your investment opportunity.

The first thing that people need to know is that making an extra income from annuities is very possible. There actually some people out there who are enjoying their annuity benefits comfortably. The method that such smart people use is to research adequately on which company to buy their annuities from.

By choosing annuities, you also realize that annuities are one of the ways in which these people who are considering about retirement should try out. By doing your own research you can notice or identify the annuities that will be best for your investment needs. In addition, you can also avoid purchasing such annuities from companies that offer them at higher rated to others as well as at a commission. This helps you greatly to avoid your retirement funds depreciating slowly due to lack of investment foresight. Moreover, a monthly pay check with a steady income definitely will cover a lot in annuities and retirement plans.

Another thing about annuities is the form of passive incomes found in them. This includes refund annuities and joint-life annuity. These two passive forms of income are very beneficial to all people who choose to purchase the annuities. Refund annuity is a type of passive income in which an individual gets a certain amount of money from an annuity company until he or she dies. And once that person is dead, his or her relatives can also receive payments if the annuity that was purchased is still valid. This is a good form of passive income as both the one who got the annuity and his or her relatives are able to be financially secure. But payments for this type of passive income are much smaller due to the fact that the benefits involve a lot of people.

Enter your zip code at the top of this page and answer some basic questions to get free annuity quotes and you can start comparing now!

Key Benefits for Using a Fixed Annuity for Retirement

As you look towards retirement, one good investment option will be to consider an annuity for retirement purposes, especially a fixed annuity that may guarantee you a fixed amount of payout everyday for the rest of your life. Compare rates from different fixed annuity providers for free using our automated calculators.

To help you with the best decision, we will focus on the term “fixed annuity”, but start with a clear definition of an annuity. An annuity can be defined as a product available from insurance companies that pays you income. It is most often used by retirees as a means to generate income after retirement. It can also be defined as a type of product from financial institutions that can help an individual save funds until it grows to a lump sum then at the end of a period or upon “annuitization”, the individual collects the money. The income generated from annuity can be paid monthly or quarterly. It can also be collected in bulk or as a lump sum.

Annuities can be either fixed or variable. Fixed annuities are like Commercial Deposits – CD like in nature and their rate of investment is guaranteed for a fixed period and most often command higher rates than the CD’s obtainable in banks. Simply put, a fixed annuity is a contractual agreement between an investor or annuitant and an insurance company.

The terms of the agreement is that the insurance company pays the investor a particular amount of money after a period of time based on how much the investor is willing to invest into the annuity. It is very important for a prospective investor or annuitant to have a general knowledge about what annuities are and how they work before investing. This helps the investor to avoid any confusion and it also helps him to decide the type of annuity that best suits his needs. Seeking the advice of qualified investment professionals is always very helpful. The fixed annuity is a very useful financial product for retirees and is mostly used in the USA.

Fixed annuities come in two forms: they are either immediate or deferred. In immediate annuity, once the investor makes the first payment into his annuity, the insurance company is due to start paying the investor after one interval of the first payment, for example, the payments can be due in as little as one month after the first investment depending on the agreement. Deferred annuity on the other hand does not payout immediately but takes a longer period of time before it is due for payment by the insurance company, usually one year or more, depending on the agreement.

A fixed annuity for retirement is considered a low-risk type of investment because it guarantees positive rates of return. If you were not willing to take the risks that come along with investing in the stock market due to its uncertainties and volatility, then a fixed annuity would be a very good alternative because it takes out all the risks!

Start now and enter your zip on the top of this page to check availability then answer some basic questions to compare multiple annuity providers for FREE to determine your highest eligible rate.

More Facts about Annuity for Retirement

AnnuityForRetirement

It’s possible to enjoy a glorious retirement period when you plan your income well while still serving. Lots of avenues abound for you to explore. You can make the most out of a profitable annuity for retirement. It’s one of the best avenues that can safeguard your retirement period.

Simply put, an annuity is a kind of contract between   you and a reliable insurance company.  You invest some cash   in the company while the company promises to use your money and pay you regular income   on agreed date.

There are specific key terms you need to know about annuity for retirement.  You’ll come across terms like Contract owner or the Annuitant, Premium, Beneficiary, Surrender Period and a lot more. You’ll also get to discover the major kinds of annuities and their categories. Among them include immediate annuities, deferred annuities, fixed annuities and variable annuities.  Each of these has specific features.  They also have their advantages and disadvantages. It’s always very important to know a great deal about all these kinds of annuities before you invest in any of them.  Failure to check them out can lead to a loss of investment even before you retire.

Generally, annuity for retirement comes with some benefits.  You can enjoy steady flow of income during your retirement if you succeed in investing in the right annuity option.

You can also enjoy tax-deferred   opportunities in some kinds of annuities.  There are also guaranteed rates of return on   your money as seen in some of the annuities.  You stand the opportunity of enjoying guaranteed lifetime payments if you go for profitable annuity for retirement.  There are still some other benefits you stand to enjoy.   The benefits depend on the kind of annuity you go for.   The insurance company you   engage also matters a lot. The terms and conditions involved are also of paramount importance.

Meanwhile, it’s important to know that annuity for retirement also comes with some disadvantages.  You may have to pay for the guarantees in one way or the other.  Some of the   contracts may also have surrender periods that can hold your money for a very long time.  There are also   the possibility of paying tax on some forms of annuity despite the claims of your insurance company. There may also be some hidden charges when you go for some of the annuities.   Just like the case with the advantages, the disadvantages of annuities also depend on the kind you go for.

To be on a safer side, it’s very important for you to know a lot about the different kinds and categories of annuity for retirement before you agree to invest your money. Take your time to pinpoint their various pros and cons.  You can engage the services of a reliable financial adviser to help you out. You don’t need to rush into investing in any kind of annuity without proper guidance. You may even lose your hard-earned money in the process.

Is Saving Important for Retirement Planning

Is saving important for retirement?

The first fundamental that you need to about retirement is to save money. If you are considering about retiring but you have not yet started saving money then you will face financial problems once you take a break from working. The problem with many who think about retiring is that they believe that saving should be done early on in life. Thus, they think that their time for saving money has already passed. Though it is true that saving for retirement should be done as early as possible, it is not too late to start saving either. You can start small and move on up until you have enough money to have a comfortable retired life. Retirement planning greatly depends on how much money you have saved. So go out there and make as much money as you can.

However, when it comes to saving money for retirement, there are many ways of doing this and one of these ways is to combine various investment avenues. So what kind of investments can be combined? Well for all those who would love to know them, several investments can be combined and used in your retirement package. These investments include mutual funds, annuities, stock, and even perhaps trying forex exchange business among others. These have the ability to make you lots of profits in different ways when capitalized upon. For example, mutual funds and annuities can assist you to have a steady income each month as you wait for the other investments such as stocks and forex exchange to grow; which in the long run can bring you a lot of money than you would have believed was possible.

Annuities offer a lot of investment opportunities for people who think about long term plans. This is good news to everyone who does not want to face financial difficulties, especially those who have just retired. With this economic recession, that has hit the world very hard; many people are looking for opportunities that will allow them to grow their investment eggs. This is a great benefit that an annuity gives you as you are able to be financially secure regardless of any economic hardships that are being faced by countless people. In fact, you can actually receive payments that are inflation protected.

But it must be noted that when it comes to saving money for retirement, there are many procedures that must be followed. In addition, some of these include making sure that the investments that are being selected are not only beneficial but also viable. This is crucial as sometimes people may invest in financial opportunities that take too many years to produce any profits. Such investments do not help during emergencies.

To get started, enter your zip code on the top of this page, and then answer some basic questions. This will help you to compare annuity plans from multiple providers for FREE to determine your highest eligible rate. It is important to provide accurate questions to these answers as our pool of providers will provide you with different rates depending on your individual circumstance and situation.

Immediate Annuity Solutions to Long Term Care

Annuity for retirement may be one of the best ways to make sure that you have enough funds, which you may use for your long-term care. It is a common knowledge that elderly may have special health needs, which may need extra money. Therefore, for your peace of mind, it is important that you have save enough money for health purposes.

Annuity is an investment product, which may help you sustain your long-term care. Annuity is characterized as a series of regular payments for a definite period. The money that you deposited is then reinvested by insurance companies to bonds and securities.

There are two kinds of annuities, the immediate and deferred annuities. The immediate annuity will allow you to receive money right after you first make your deposit. Most of the time those who are near the retiring age of sixty chose this type of annuity since they do not have to wait for long. They will get the money instantly without any maturity period, which are often required to other investments.

Meanwhile, deferred annuity includes two types of funds. The investment includes a long-term care fund, which is ideally used to pay services like long-term care in nursing homes. Meanwhile, it also has cash funds, which have offer interest rate with a minimum of three percent. The three percent minimum is the biggest highest return of investment in the market considering that it is tax deferred. Tax deferred meaning there is no hidden taxes for your every transaction. Unlike in mutual funds, which subtract a tax for every deposit you make.

Initially, to get the approval for your application, you need to be at least below eighty-five years and be able to meet the health requirements of the insurance company but those people who have pre-existing medical condition can still apply for annuity. The only medical condition that is not acceptable is dementia and Parkinson’s disease but other than that, you can avail annuity of your choice.

The good thing with annuity is that you can still be eligible even if you are already receiving long-term care. They will not decrease your chances for approval of your application even if you are receiving a special care for your condition.

You may even get the money right after you deposit your initial investment. Therefore, you can immediately use the money for your long-term care. There is no need for you to wait for several months or years before you can get pay out. With annuity, your paycheck is always available to address your hospices or health needs.

If in case, the annuitant dies unexpectedly, then the annuitant heirs or representative will be able to get the smallest or the remaining unused funds that are allocated in the annuitant. Technically, there is no loss here, because the annuitant can signify in writing the name and details of his or her heir. The heir will be able to get the benefits that are part of the annuity.

To know if you are qualified for the annuity, simply enter your ZIP and answer some basic questions to receive a free annuity quote today.