An annuity is considered to be a contract between you and an insurance company of your choosing.
It is a flexible financial vehicle that can be tailored to your specific financial needs, however it is usually a popular choice for safe money investors who want to have a steady and reliable stream of income during their retirement years.
It is intended to produce regular monthly income (but can be disbursed in monthly, quarterly, annually, or even lump sum payments) during your retirement years.
You may make a lump sum payment or a series of payments and in return you can obtain regular, systematic payments either starting right away or sometime in the future. The payment is determined by a variety of factors, which will usually include the length of your payment period, as well as the interest rate being paid out to you.
Learn more about the annuities that we offer:
BEWARE OF ANNUITY FRAUD
The tax-deferred annuity is a popular financial product that is used as a part of a diversified portfolio by many Americans and others around the world. The annuity is also one of the most mis-represented financial products on the face of the earth.
- Be wary of someone that tells you not to buy an annuity. This blanket sort of a statement does not serve you well. All legitimate financial products, including the annuity, may have a place in a diversified portfolio.
- Never sign an annuity application or write a check to an insurance company unless you know that you understand what you are buying. If you are a mature or financially illiterate individual or couple it may be helpful to ask a disinterested person for a factual second opinion.
- Never write a check to an individual; only write your check payable to the life insurance company.
- Make sure you know exactly how you get your money back. Many annuities permit you to withdraw at least 10% of your principal investment each policy year. Beyond that – all annuities make you pay a penalty (called a “surrender charges”) to get more than 10% of your money.
- Know how long your money will be committed to the annuity. A normal commitment ranges from five to ten years.
- How much is the insurance agent being paid to sell you an annuity? 2 to 5% of your investment is a normal annuity commission range.
- Know the financial strength of the insurance company. While insurance company ratings guarantee nothing, ratings can be used as a guide to judge an insurance companies financial strength. Insist on an AM Best Rating of A- or better.
- Beware of the fast talking insurance agent that wants you to “trade-in” your existing annuity (or investment) for a “new, better model.” In some circumstances annuity “replacement” may be justified – but rarely.
Be careful out there.
Contact us for more information or assistance in determining what Annuity is best for you.