If you’re planning to retire in the near future, there’s the need to prepare well. You need in invest in various annuity options. Variable Annuity can also pay you well if you invest in it through proper guidance. This kind of annuity gives you to room to invest in diverse opportunities. You can invest in stocks, mutual funds and bonds.
In most cases, the insurance company you choose will require you to pay an initial purchase payment while you expect to receive income payments and gains from the same company at a later date agreed upon. The contract details must be properly signed with terms and conditions that apply.
To get the most out of Variable Annuity, you need to take time to locate the most suitable type that can serve. Basically, there are two major types of variable annuity. They include deferred variable annuity and immediate variable annuity. Deferred variable annuity gives you the room to defer your expected payment for a long period of time. This pays you a lot since the money will keep accumulating. You may even pay a little amount initially for the investment and then watch it grow over time. You’ll not pay any tax as well until you’re ready to make cash withdrawal at a future date.
On the other hand, the immediate variable annuity begins to pay you right from the very first month when you make the initial purchase payment. The income payment may not be much since your insurance company will pay you according to the performance of your investment. It’s always better to allow the investment to grow for a long time in order to enjoy the dividends. You don’t need to worry about losing your investment in case of sudden death. There’s always the provision of bequeathing the dividend to your beneficiary who may be your spouse or your child.
To get the most suitable Variable Annuity, you also need to consider other factors. You need to consider the charges involved. There is a surrender charge required especially when you’ll be making withdrawals. You need to also consider management fees and other charges that may apply. Oftentimes, the charges are dependent on the insurance company you’re dealing with. You need to know the company very well before you decide to invest in their offers.
You’ll also need to consider sub-account investment options, portfolio re-allocation limits, lifetime dispersal options and other features before you invest in the Variable Annuity. This protects you from various dangers associated with the investment plan.
There’s always the need to be well informed when looking for a suitable Variable Annuity. You can use the internet search engines to carry out a research on the best quotes from various companies. Today, several insurance companies in the US are offering all kinds of annuities for retirement purposes. You need to make proper inquiries before you take any step. There are insurance agents and financial advisers who can also help you out. You have to create some time to contact them.