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2012年9月24日 星期一

Charitable Gift Annuity - Immediate, Deferred, College, Flexible Annuity


For some people, a Charitable Gift Annuity (CGA) is a convenient way to donate funds to an educational, religious or other charitable organization. A Charitable Gift Annuity works very similar to other annuities you might purchase through your insurance company, but in this case you will receive an annuity payment directly from the organization. Typically, you donate a monetary amount to the organization of your choice and then begin receiving payments either immediately or at a predetermined date in the future.

Donations to charities are subject to the charitable tax deduction, and you are entitled to make this deduction on your income tax return for each year you make a new donation. You can choose to receive your annuity payments yearly, quarterly, or monthly, although most people choose quarterly payments. Quarterly payments from a Charitable Gift Annuity are received on the last day of the quarter, not the first.

Similar to other annuity options, Charitable Gift Annuities are subject to state and federal regulations. The American Council on Gift Annuities (ACGA) sets uniform gift annuity rates for use by charitable organizations. These rates set the recommended limits for payout rates to the donor.

If a charity stays at or below these rates, they are not required to justify that their rates are within state regulatory laws. If the charity chooses rates above those set by the ACGA then an actuary is necessary to ensure compliance to the individual state laws. Rates are determined by the age of the annuitant and when the withdrawal period for the annuity begins.

A charity may spend a portion of a donation immediately but must retain enough money in its reserve to satisfy its annuity agreement with the donor. The agreement for Charitable Gift Annuities states that the annuitant will receive fixed payment amounts for their lifetime only and not an additional period of time thereafter for their beneficiaries.

This means that once an annuitant dies, payments cease and the remainder of the annuity is absorbed by the charity. The donor can opt to extend the annuity agreement to an additional annuitant, as with the joint and survivor or two lives in succession options, but the annuity payments will be split between the two individuals and will cease after both parties have died.

DIFFERENT TYPES OF CHARITABLE GIFT ANNUITIES:

IMMEDIATE GIFT ANNUITY

1. If you choose an Immediate Gift Annuity, payments will begin in the payment period immediately following the final contribution date. As mentioned previously, the annuitant can choose to receive payments annually, quarterly, monthly, etc. Depending on when the contribution was made, you can request your first payment to be for the full, and not prorated amount.

DEFERRED GIFT ANNUITY

2. With a Deferred Gift Annuity, the annuitant is allowed to receive payments at a future date predetermined by the donor. The date chosen must be at least one year from the contribution date, but the payout schedule offers the same flexibility as the Immediate Gift Annuity.

COLLEGE ANNUITY

3. A parent or grandparent may want to establish a college fund for a child to offset the rising cost of higher education. In this case, they would donate money for a College Annuity which will only pay out over the lifetime of the child (annuitant). Payments usually begin at age eighteen, or when the child/annuitant is old enough to attend college. The annuitant may choose payments for life or receive larger payments spread out over the number of years they attend school.

FLEXIBLE ANNUITY

4. A Flexible Annuity allows the annuitant to decide the starting date for payments. Usually the annuitant chooses retirement or another date of importance to begin receiving payments. Keep in mind that one factor for the annuity payment rate is age, so you will receive larger payments if you wait until you are older.

HOW DOES A CHARITABLE GIFT ANNUITY WORK?

You may be asking how this works in a real life example. Let's assume you just turned seventy-five and have $25,000 that you would like to donate to your alma mater as a Charitable Gift Annuity. You opt to receive immediate annuity payments on a yearly basis, and your calculated annuity rate is eight percent. Based on your annuity agreement with your alma mater, you will receive a payment for $2000 every year for the rest of your life, and an immediate tax deduction of over $9000!

This is only an estimate, and your actual deduction will vary according to changing tax laws and changing rates established by the ACGA. You should always consult with a knowledgeable financial advisor such as Estate Street Partners before donating or investing large sums of money to guarantee your rights are protected.




Author bio - Rocco Beatrice, CPA, MST, MBA
Award-winning estate planning & trust expert
MS - Taxation, Master of Science Taxation
MBA - Management / Taxation
BSBA - Management / Accounting
CPA - Certified Public Accountant
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Irrevocable Trust Asset Protection, Medicaid Asset Protection
Private Annuity Trust
71 Commercial Street #150, Boston, MA 02109
tel: +1.508.429.0011 fax: +1.508.429.3034





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2012年9月21日 星期五

Immediate Annuity


Immediate annuity is a type of annuity in which the contract owner starts getting payments after a single premium is paid. Payments can be made on a monthly, quarterly, annual or semi-annual basis. The rate of payment in immediate annuity is of two types, fixed rate and variable rate. The fixed rate guarantees a set income that will not fluctuate, whereas in variable rate payments will fluctuate according to the performance of selected investment the annuity is based on.

Immediate annuity is a vehicle for distributing savings with a tax deferred growth factor. Insurance company assumes the risk of the payouts lasting annuitants whole life in case of immediate annuity. Generally one can never outlive these payments and various choices are available for payment set up as well. There are some plans available which allows change in payment structure at a later date.

Immediate Annuity provides security and stability to its buyer by providing stable lifetime income or a guaranteed income for a specified period of time. It is simple and easily manageable because the annuitant does not need to manage his/her investments, watch markets, report interest or dividends. Immediate annuities provide quality return because insurance companies generally give higher interest rates on annuities than CD or treasury rates and also the principal is returned with each payment. We suggest you to select annuity product carefully according to your need due to the fact that most conventional immediate annuities cannot be revised or cashed in.

An immediate annuity can be purchased with funds from a variety of possible sources, such as: a maturing certificate of deposit, monies which have accumulated in a deferred annuity account; or funds from a tax-qualified defined benefit, 401k or IRA account. Under current tax law, a portion of each payment received from a non-qualified immediate annuity is tax free until your total premium is recovered. The remainder of each payment will be taxed as ordinary income in the year you receive it.




Nick Jameson is a well known author who writes on Immediate Annuities for the website fixedannuitylibrary.com





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2012年9月18日 星期二

How to Compare Variable Annuities and Immediate Annuities With Other Options


With so many different types of annuities, simply reading all the names might confuse you. It doesn't have to be that hard. The names of the various types of annuities often imply exactly what the annuity does or how you invest the money on the interior of the annuity.

You have so many different names of the products themselves. Ignore their commercial name and simply focus on the type of annuity to make the process easier. Are the products fixed annuities, variable annuities or indexed annuities? Those are the three main types of annuity products. Everything else is a variation of those three.

Fixed annuities pay a fixed interest rate. Often these products offer a guaranteed higher interest rate for the first few years. They also have a guaranteed lowest possible rate. Even if the interest drops dramatically, the company promises to pay at least that amount. In the mid 2000's, interest rates dropped to 1 percent and less. People added money to their fixed annuities because of the guarantees of at least 3 percent return. Companies, however, lowered their guarantee on their newer products.

Variable annuities offer the opportunity to not only take advantage of the economic conditions but also guide your investments. Often these contain mutual funds from several different companies. The investor gets to select the funds and the amount he wishes to invest. For those that feel uncomfortable selecting funds, companies offer groups of funds and target them by the amount of risk. The company balances these on a regular basis to maintain the same level of risk. For people near retirement, often a blend of fifty percent stock and fifty percent bonds is the standard investment.

Indexed annuities use a specific market indices as the key to their payment. In the case of those indexed to the S&P 500, the owner of the policy receives a percentage of the growth of the stock market if the S&P 500 climbs. If the market drops, however, they don't get a percentage of the loss. They receive, instead, the guaranteed interest rate offered in the policy. Often this is lower than the going interest rate, but still very palatable when you consider the other option, a loss.

Other ways companies classify the annuities is how you take your money from the policies. If you put in money and immediately begin to take an income for a fixed period, a specific amount or the rest of your life with or without guaranteed return of principal, the product is an immediate annuity.

Deferred annuities are tax-deferred products that simply act as a method of savings until you select a way to take your funds later. If you decide never to take the money, it goes to the beneficiary you name on the policy.

You can have immediate annuities or deferred annuities that are variable annuities, index annuities or fixed annuities. The variable annuities often offer the option of varying the payment when the market increases once you annuitize the product. Younger people that use this vehicle for a lifetime of income benefit from this inflation fighting quality.




Jonathan M. Tyler shares his knowledge of annuities on a weekly basis, through his articles and through our website. Click on the link to learn more about immediate annuities and the other annuity options.





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2012年9月17日 星期一

Immediate Income Annuity - A Better Choice for the Retirees


Everybody wishes for a stress-free retired life. But to ensure a relaxed retired life, one must secure his/her financial future. When it comes to investing minimum risk but enjoying maximum benefit, a single premium immediate annuity (SPIA) may be a preferred choice for the individuals. An annuity may be of different types including fixed or variable, immediate or deferred, qualified or non-qualified etc. But the income annuity on offer by SPIA is of immediate type. The annuitants receive the amount of investment plus the accrued interest through immediate income payment after regular interval. SPIA is also known as 'single premium' as an individual is required to deposit the lump sum to ensure his/her financial security.

Such income annuity is often considered the best option for the retirees as they can receive a streamline of payments after the retirement. But extensive market research and an expert's valuable advice are what help one take the best decision in this regard. Let us suppose, a sixty year old person gains an astronomical amount in a lawsuit. So, it is just like a pauper becoming a millionaire overnight. In this case investment into an income annuity is the better choice for him. With the facility of immediate payment as offered by the SPIA, the person will earn income from the next month after he makes investment.

By purchasing such an income annuity policy, an annuitant can earn monthly income for 10-15 years or may continue to receive the regular payment till he breathes his last. The choice between the fixed and lifetime payment is guided by many an important factor including the annuitant's age, amount of single premium and of course the interest rate offered by the insurance company. The aged personnel will derive the optimum benefits by investing into the lifetime income annuity policies. Now take the case of a fifty-five year old lady who has won $200,000 in a lottery. But she has an outstanding amount of mortgage loan to pay off. In that case, the lady must try to clear the dues and continue to work for a few more years to earn enough income to support her throughout the twilight years. In such case, an income annuity scheme by the SPIA is not a suitable choice for her.

Each individual has a unique need but an income annuity may be a good solution for those who are either retired or about to retire. Most of the immediate annuity policies require the annuitants to be at least fifty-five years old. The majority of the individuals prefer to go with a SPIA policy. It is because they either have no concrete plans for their advanced years or no adequate amount of pension. But prior to buying an income annuity policy, the investors must weigh both the pros and cons so that they do not end with making a wrong choice. Some consider the deferred annuity as the best choice for them. Still, assessment of one's financial objective is a must to select the best pick in the market.




Mike Anderson is a business consultant who has good information on income annuity. For more information visit http://www.immediateannuities.com/





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2012年8月31日 星期五

Immediate versus Deferred Annuities


An annuity is a contract between the insured and the insurance company to provide income for retirement. It typically offers regular payments made over time. Annuities have existed for over two hundred years. They are paid out over the recipient's lifetime or for a set amount of time. They are usually issued by insurance companies through licensed agents. Simply put, an immediate annuity is set up when you want the income now and a deferred annuity builds value over time and is converted to income later on. One key difference between immediate and deferred annuities is that deferred annuities can be bought with a lump sum payment or a series of regular payments.

A deferred annuity accumulates value over time and helps you save for things like retirement. This works to grow your assets. A fixed deferred annuity comes with some nice guarantees: it is guaranteed against loss by the insurer, it is guaranteed a minimum rate of return, and it has guaranteed annuity payout factors. Some benefits include tax advantages, no limits on contributions, and safety of premium so risk is minimized in a market downturn. A variable deferred annuity allow for more growth potential in return for a higher level of risk. Its value fluctuates, depending on how the investment options perform.

Deferred annuities allow for a lump sum payment rather than the payments over time. However, there are no stipulations for a lifetime guarantee. There are deferred annuities where you can withdraw money during the accumulation period - although there are limitations on the amount you can withdraw in a one year period.

An immediate annuity works particularly well for someone who might have come suddenly into a good deal of money and needs a better way of managing it without having to deal with investing it. Most people choose a fixed immediate annuity because of the guaranteed annuity payments promised. However, there is an increased interest in variable immediate annuities because of low interest rates and potential for strong equity ability.

Immediate annuities can be set up for payment over the course of a specified period of time (like 10 or 20 years) or indefinitely (like for a lifetime). There are some great benefits to choosing an immediate annuity such as security in future income, simplicity as the annuitant does not need to manage an investment portfolio, high returns (higher than CDs), and preferred tax treatment to name a few.

There are many different forms of immediate annuities. The most simple are the straight life or non-refund immediate annuity which guarantees the payments over the lifetime of one person. Other forms include period certain annuities where benefits are paid by the insurer for a specified period of time (like 10 or 20 years), straight life annuity where benefits are paid out only for the lifetime of the annuitant, joint and survivor annuities where fixed monthly income payments are made for the lifetime of two or more people.




Samuel Towers' writes to expand possibilities on the financial side of life. Currently he is examining what's possible in the world of structured settlements and annuities. What he learns, he'll share in his articles.





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2012年8月27日 星期一

Immediate vs. Deferred Annuities


Do you want income now or income later?
When you purchase an annuity, you can choose between an immediate annuity - if you want the income right away - or a deferred annuity - if you want the opportunity to build your account value over time and convert it to income in the future.

Immediate Annuity

When you purchase an immediate annuity, you make a single lump-sum payment and set the starting date for the payout to begin sometime within 13 months. The term and the amount you'll receive are determined by the annuity contract.

With an immediate annuity, you control the term: You can choose income for your lifetime (known as a life annuity) or for your lifetime and that of another person (known as a joint and survivor annuity). You can also add a guarantee period to a lifetime income payout option, under which your beneficiaries will receive the payments remaining in the guarantee period should you die before the end of the period. You can also choose between time-specific or amount-specific payout possibilities.

What You Receive:

The size of the monthly payment you'll receive, on the other hand, is set by the annuity provider based on:

* How much you invest in the annuity (annuity principal)

* The payout option chosen

* Whether you have chosen a fixed annuity or variable annuity

Note: Some variable annuity contracts may permit you to choose between receiving annuity payments that are fixed in amount or annuity payments that vary based on the performance of the underlying investment subaccounts.

* Personal factors, including your age and, if it's a joint and survivor annuity, the age of the other person

The Immediate Advantage:

There are certain advantages offered by an immediate annuity that can make it an attractive choice for retirement income.

Principally, an immediate annuity can help ease the concerns people may have about managing a diversified investment portfolio or, even more frightening, of outliving their assets.

As an example, someone who has just received a large sum of money--an inheritance, a bonus, or profits from selling a home or a business--but really needs a steady source of income can choose an immediate annuity. Also, many experts suggest that anyone who expects a lump sum pension or 401(k) distribution might consider an immediate annuity as a way to convert their funds into a stream of income they can't outlive.

How to Choose a Contract:

The primary reason that many people used to choose a fixed immediate annuity was for the guaranteed annuity payments it promised. However more recently, low interest rates and the potential for strong equity performance have created an increased interest in variable immediate annuities.

Because the guarantee of principal and return of a fixed annuity is based on the claims paying ability of the insurer, the reason to choose a fixed immediate annuity usually comes down to which highly-rated fixed annuity company provider will guarantee the largest regular income for the term selected. However, income amounts vary because each fixed annuity company may use different annuity purchase rates for determining the annuity payments they make.

As an example, a 55-year-old widow who buys a $100,000 immediate annuity, and elects to receive monthly annuity payments for the rest of her life, might receive anywhere from $611 to $766 each month depending on the fixed annuity company provider. If she lived for 35 years--to age 90--the difference could amount to more than $65,000.

In choosing a variable immediate annuity, most annuity contracts allow you to choose to have your annuity payments last for a set period of time (such as 20 years) or for an indefinite period (such as your lifetime). During payout your contract may allow you to choose between receiving annuity payments that are fixed in amount or annuity payments that vary based on the performance of the underlying investment subaccounts. There are many factors to take into account, including the potential performance of the investment portfolios in the contracts being considered, the options offered, the annual expenses of the contracts and whether or not you are willing to take the risk that your account may decrease if the underlying investments perform badly. Our planners and financial specialists can provide assistance to evaluate the alternativesand determine what would work best for your personal investment plan.

When you purchase an annuity, you can choose between immediate annuities - if you want the income right away - or deferred annuities - if you want the opportunity to build your account value over time and convert it to income in the future.

Deferred Annuities:

A deferred annuity gives a person the opportunity to build their retirement savings over a number of years. What is being deferred is when the income is received. But in the period between signing the contract and converting the accumulated assets to a revenue stream, the deferred annuities investment has the opportunity to grow in either a fixed account, variable sub-accounts (investment portfolios--depending on investment performance), or both.

Unlike immediate annuities, which can only be purchased with a lump-sum, deferred annuities can be purchased with both a lump sum and or a series of payments. The ability to combine one-time and periodic contributions gives added flexibility in building a retirement annuities account.

In most cases, there is still limited access to the funds in a deferred annuities account until those accumulated assets are converted to a revenue stream. This means there can be some annual withdrawals, or surrender the contract entirely, getting back its then-current value minus any surrender fees. But if there are withdrawals, the money will be gone, and the retirement annuities account will be reduced. There may also be a 10% tax penalty prior to age 59½.

It Can Pay to Wait:

Deferred annuities are especially appealing if a person has "maxed out" their employer's salary-reduction plan but wants to put away more for their retirement. And if a person isn't earning income, deferred annuities are one way for potential earnings on the investments to grow tax deferred.

Unlike employer-sponsored plans and IRA's, there are no annual limits to the amount that can be contributed to non-qualified deferred annuities; therefore more can be contributed when more is available, for example as the result of a big bonus or other windfall.




Russell Hill writes articles for a variety of subjects including fixed annuities, variable annuities, indexed annuities and other retirement investment vehicles. More information on annuities can be found at: http://www.annuity-strategies.com





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2012年8月25日 星期六

Annuity - Fixed, Variable, Equity-Based Annuity - Deferred, Immediate Annuity


Annuities are not a new concept, although they have become more complex over time. The first annuities were documented in America during the mid-eighteenth century by Pennsylvanian ministers, and it was not until the early twentieth century when they became available for purchase by the general public.

WHAT IS AN ANNUITY? HOW CAN YOU BENEFIT FROM AN ANNUITY?

So, what is an annuity, and how can you benefit? A simple answer is that an annuity is an agreement between you and your insurance company. Annuities can only be sold by agents specifically licensed to do so, and each insurance company is regulated by individual state insurance commissions. Your insurance agent must possess a life insurance license as well as a license from the National Association of Securities Dealers (NASD) or the Securities and Exchange Commission (SEC).

If your insurance company goes bankrupt, other licensed companies in the state are required to honor your contract. The terms of an annuity are that you will pay a sum of money to the insurer (either a lump sum or series of payments) and they will make scheduled payments to you immediately or delay payments until after a certain period of time.

Unlike your 401(k), annuities grow tax-deferred and you will not pay any taxes to the Internal Revenue Service (IRS) until you begin withdrawing funds from your annuity. Unlike other savings options through a bank which may calculate and charge yearly taxes on your interest, in a tax-deferred annuity your taxes are based only on the final accumulation of your annuity at the time of withdrawal.

ANNUITY TYPES: FIXED ANNUITY, VARIABLE ANNUITY, EQUITY-BASED ANNUITY

In addition to deciding when you will receive your money from an annuity, you can also choose between a fixed and a variable annuity. A fixed annuity guarantees a minimum interest rate while your annuity accumulates, and guarantees equal check amounts when you withdraw from the annuity.

A variable annuity allows you different investment options for your funds, with a mutual fund as the most common choice. A variable annuity offers no guarantee to payout amounts, and your income from this annuity will fluctuate depending on the investment vehicle you chose. On occasion you may be offered an equity-based annuity which determines your interest rate based on an equity index such as the S&P 500.

CHOOSING BETWEEN A DEFERRED ANNUITY AND IMMEDIATE ANNUITY PLAN

Deciding between a deferred and an immediate annuity is a matter of personal preference. If you prefer to save for a long-term goal such as retirement, and have no immediate need for the money, you should consider a deferred annuity. It is important to remember that if you choose this type of annuity there are penalties for early withdrawal. The IRS imposes a standard ten percent penalty, in addition to income tax on accrued funds, if you withdraw money before the age of 59 ½. Your insurer may also charge you surrender fees for early withdrawal.

3 METHODS FOR REQUESTING PAYMENT FOR DEFERRED ANNUITY

If you wait until retirement to withdraw money, there are three methods for requesting payment from a deferred annuity. You can:

1) Request a lump sum payment or

2) Take out money only when you need it or

3) Annuitize and receive a set dollar amount every month for as long as you live

Most people choose to annuitize because it also spreads out the required income tax payments. If you die before withdrawing from the annuity your beneficiaries are entitled to receive the balance of your annuity by these methods as well, although if they choose a lump sum they will be charged all the tax on your accrued interest at once.

IMMEDIATE ANNUITY IF CLOSE TO RETIREMENT

If you are close to retirement, or already retired, an immediate annuity is a wiser financial choice. Immediate annuities must be purchased with a lump sum since payments will usually begin within one month of purchase. When you purchase an immediate annuity you are guaranteeing a steady income for the rest of your life, or for a predetermined time period. When you receive payments from an immediate annuity you are only taxed on the earnings from your initial investment. The part of your check that is the principal is not taxable.

3 MAIN OPTIONS FOR WHEN YOU RECEIVE AN ANNUITY PAYMENT

There are three main options to choose from when receiving an annuity payment.

1) The first is Income for Life which guarantees you a set income for the duration of your life, but payments will cease upon your death. This option is risky since you don't know exactly when you will die. Should you die before your annuity has been completely paid out, the insurance company, and not your beneficiaries, will receive the remainder of the annuity funds.

2) The second payout option is Income for Life with a Guaranteed Period. This option is more appealing because it provides the same coverage as the first option, but if you die before the predetermined guarantee period expires, your beneficiaries will continue to receive payments until the guarantee period ends.

3) A third option is known as the Joint and Survivor option. This option guarantees payment to you and another person, usually a spouse, until both of you dies. Annuity payout options are flexible and any of these options can be combined to fit your individual needs.

DOWNSIDES TO AN ANNUITY

Annuities may also be used to fund your 401(k), 403(b), and Individual Retirement (IRA), although it is not generally advised to use your annuity for this purpose. The two downsides of greatest concern are a contribution limitation, and the federal government requirement for you to begin receiving minimum payments by age 70 ½. Additionally, once you have used your annuity to finance your 401(k), for example, you will incur a ten percent penalty for early withdrawal if you take money before you reach age 59 ½ and there are few exceptions to paying this penalty. Once you begin receiving annuity payments you cannot change your mind, and you will continue to receive payments for the predetermined time frame established during the accumulation phase.




author bio - Rocco Beatrice, CPA, MST, MBA
award-winning estate planning & trust expert
MS - Taxation, Master of Science Taxation
MBA - Management / Taxation
BSBA - Management / Accounting
CPA - Certified Public Accountant
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Asset Protection Irrevocable Trust, Offshore Asset Protection
Will Contest: What is it? How can you Protect a Will?
71 Commercial Street #150, Boston, MA 02109
tel: +1.508.429.0011 fax: +1.508.429.3034





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2012年8月24日 星期五

Immediate Versus Deferred Annuities - We Answer Your Questions


An annuity is an investment vehicle offered by an insurance company to individual investors looking to accumulate cash and/or create an income stream for retirement. There are two primary income benefits options available to annuity owners, immediate and deferred.

Immediate Annuities

As people approach retirement, their focus often shifts from the accumulation of assets, to the liquidation of assets for the purpose of creating an income stream. While many retirees of past generations were able to rely financially upon pensions offered by their employees, retirees of today are often forced to rely upon their own individual investments for their retirement income needs. One of the investment vehicles many individuals turn to upon retirement is the immediate annuity.

US citizens may start receiving payments at a minimum of 59.5 years of age - therefore immediate annuities are only an option for people of this age demographic. If withdrawals from an annuity are taken before that age, you will receive a tax penalty from the IRS, and possibly from the insurance company as well. The income payments made to the annuitant will consist of principal and interest. How these payments are segmented depends on the type of annuity chosen and the interest received - fixed, variable, or indexed annuity.

Deferred Annuities

A deferred annuity focuses on asset accumulation and tax deferral on the account interest. This type of annuity has an accumulation period, which differs from the immediate annuity option. This type of annuity can be funded with any premium plan depending on the type of annuity (fixed, variable, or indexed) and the insurance company. Contributions into a deferred annuity can be utilized to accumulate funds for retirement, as they will grow on a tax deferred basis.

Both annuities serve different investment purposes, giving individual investors options for how they will accumulate funds for retirement and how they will receive those funds during retirement.




For more information on annuities, go to http://www.bestfixedannuityquote.com

John C. Ryan works with http://www.BestFixedAnnuityQuote.com offering the latest information and resources on fixed, variable, and indexed annuity insurance along with annuity quotes from experienced professionals.





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2012年8月23日 星期四

Immediate Vs Deferred Annuities For Retirement Planning


Have you Heard About Retirement Planning with Annuities?

It is hard to walk into a bank or speak with an insurance agent without hearing about retirement annuities. There is a lot of interest because these insurance company products have some of the features of inusrance and savings or investments.  Because of this, they may be a safe and sound way for you to plan for your future goals.

Although they have other uses, one basic goal that many purchasers have is retirement planning. Keep in mind that your retirement may be coming up next month, you may already be retired, or you may be planning for a goal that is many years down the road. Your own choices will depend upon your individual situation.

Immediate Annuities For Income Now

If you have a lump sum of money that you collected from your job, or have just saved over a period of years, you may be interested in having a way for that money to produce a guaranteed income for you. Of course, your options will be affected by the amount of money you have and the amount of income you want to collect. With an immediate income product, you can deposit your money this month and start collecting your income next month!

You can choose a variety of payout options. Some popular examples may be 10 years, lifetime, or joint survivor (the surviving spouse collects). Again, your choice will depend upon your financial goals and the amount of money you have to deposit.

You may choose 10 years if you have another investment that will mature down the road, or if you just want income now so you can start that retirement business you always dreamed of.

You may choose a lifetime payout if you just want to insure that you will have an income for your retirement years.

Deferred Annuities For Income Later

If you want to start building a lump sum for retirement, you should look into deferred products. You may invest some money now, and then keep making contributions periodically, say every month or every year, so that your cash account will grow over time.

The money will grow without being taxed. If you used pre-tax dollars to invest, you will be taxed when you withdraw it. If you already paid taxes on the money, you will not be taxed later. This can be a good way to get the maximum mileage out of your investment money.

How Does The Cash Account Grow?

You may by an annuity with a fixed interest rate. Or you may decide to choose one of the popular indexed annuities that is tied to a major market index.

How is Risk Eliminated?

A fixed annuity, that is tied to a market index, should come with a guarantee that you will never lose money too. In up years, your gain may be somewhat less than the market's growth, but in down years, your gain should be fixed to 2 or 3 percent growth. The potential of gain, while still eliminating the risk of loss, is one reason that annuities are popular ways to plan for retirement.




If you are planning for your retirement, you probably want to speak with a qualified professional about annuities. We urge you to educate yourself on the variety of products in your local area.

We provide free annuity quotes with a safe, fast, and free online form. It is a quick form, and it does not obligate you to do anything.

For more information, please see - Explain Annuities





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