Annuity for retirement has always been the best investment option for anyone who truly desires to enjoy steady inflow of income during the retirement period. There are specific forms of annuity you can always explore. Life Annuity is one of the best options that come with lots of benefits. Let’s have a look at what it stands for.
Lifetime annuity is a kind of annuity for retirement that pays you specified amount of income for the rest of your life period here on earth. It’s a kind of contract between an insurance company and the individual involved. You have to choose a reliable insurance company that offers such kind of annuity. In most cases, many insurance companies that offer annuity for retirement are likely to offer the lifetime annuity policy. It’s known to be very common all over the insurance industry.
In Lifetime annuity, you’re expected to invest your pension fund as may be agreed between you and the insurance company. Usually, the insurance company pays you a regular income in return for the pension fund you invest. The income can be paid monthly or quarterly. It can also be paid yearly or twice in a year. You have to choose the best payment plan that can suit you.
Lifetime annuity can be referred to as immediate annuity. It usually begins with a proposition. You as the investor will hand over a lump sum of cash to the insurance company of your choice in exchange for a guaranteed payout for a specified period of your life. In most cases, your initial investment is likely to go to the insurance company after your death. However, the payments can still be continued to your spouse if you’re married or to your dependant.
Lifetime annuity for retirement comes with various benefits. Apart from the returns you have from your pension fund investment, you’re also sure of other unique benefits. For instance, you can choose when to receive your payments. You can equally decide to leave the income the same for the rest of your lifetime or you can decide to have it increased per year.
Again, you can also include a guarantee to allow payments to be made for a specified period of time even if you happen to give up the ghost within that same period. Simply put, Lifetime annuity is very flexible. There’s always the room to make choices. You can even choose whether the income stops coming in at your death or whether it has to continue with your spouse or any other person you may leave behind.
Lifetime annuity as a form of annuity for retirement is taxable. You’re expected to be paying tax all through the period of the annuity. You may have the challenge of making your saved money lasts as long as you desire especially after piling it up for years.
In all, there’s always the need to enter into a formal contract with the insurance company you’re dealing with. There’s also the need for you to take your time in locating a reliable insurance company that can offer you the best of annuity for retirement. You’ll always gain a lot if you locate the right company.