2012年9月27日 星期四

Why Consider Annuities For Retirement Savings?


Are You Trying To Make Retirement Plans?

If you plan to retire next month, or if you have no plans to retire for many years, you should still be making retirement plans. It is never too soon to make these plans. But even if you think your retirement is a short way off, there is not better time to start than now.

There are types of annuities that attract people with long and short term plans to retire. The best type of account will depend upon your own particular situation. I cannot predict the future economic situation of the world, the country, or particularly, any of my readers. I just want to explain a little bit about fixed annuities so you can decide if you would like to do further research on your own.

Single Premium Immediate Annuities For Retirement Income Now

People who plan to retire right away may look at single premium immediate annuities (SPIA) as a way to use their money to give them more retirement income. Of course, your own income will depend upon a number of things. The amount of money you have to put into the account, the returns of your particular annuity, and how long you expect to get your income will all affect how much money you can withdraw each month.

People use an SPIA as a way to turn a large sum of cash into income. This only works out well if you have that large sum of cash to use, and if you do not mind giving up control of that money for several years. If you change your mind, and take your principal out early, you may be subject to high penalties.

If you do have this large sum of money to set aside, you may be happy with the fairly low risk and decent returns of many fixed annuity plans on the market.

Deferred Annuities For Future Retirement Income

If you do not have a large sum of money today, but want to build an account for the future, you may want to consider a deferred annuity. You can fund this account with one cash payment today. Some accounts allow you to make future contributions over the course of years. So you might seed the account with a few thousand dollars now. Every year, you may add to the account. This will allow you to build up a fund if you have a few years before retirement.

This can be one way to increase your future retirement income. However, be sure that you will not need your money in the near future. Most of these plans have high surrender penalties if you take out your cash before the surrender date.

Are Fixed Annuities Right For Your Own Retirement Plans?

Everybody has different needs.

Many folks prefer bank savings accounts and certificates of deposits. These are considered very safe savings products. Most of them are fairly short term too. You will not have to lock your money up for years. But these days, most have very low returns.

Other folks like to invest in market products like stocks and bonds. These may have higher returns, when times are good, but can also be very risky when times are bad.

The main attraction of fixed annuities is that they are considered safe products, but can return more than bank savings accounts. This article cannot illustrate any particular product, or predict the future. I am just trying to provide you with a simple guide to one retirement savings alternative.




Consider some annuity advantages when you are trying to figure out the best way to plan for your retirement income. To dig a bit deeper, learn about single premium immediate annuity advantages too.





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