Annuities For Dummies

When searching for information about buying or selling annuities try this trick. Do a Google search for the particular annuity topic you are searching for and include the name suze orman in the search title. Some examples:

fixed Index annuity suze orman
how to sell my annuity payments suze orman
what is an annuity loan suze orman
fixed annuity definition suze orman

What you will receive is information or links to information written by one of the most financial advisers, Suze Orman. She can be seen currently on many TV networks and has written dozens of books on almost any financial subject you are concerned with. Many financial information searchers will include her name in the search term because they feel comfortable with hir advice.

She has written extensively on annuities and in one of her books originally released in 2001 she has an entire chapter, some 22 pages, devoted to the subject. She has an interesting writing style that she uses to explain this sometimes complex information. Her annuity chapter is dived by subheading.

Buyer Beware, Annuity Basics, Purchasing An Annuity, Kinds Of Annuities, Annuitizng Your Investment and Taxation of Annuities. Under each heading she lists the information in the form of questions and answers. For instance under the heading of Kinds Of Annuities she has a subheading covering Single-Premium Deferred Annuities. Under this subheading are a numer of questions and answers. One such Q and A is:

How can I check on a company's renewal rates?
Ask to see the history of renewal rates for older SPDA policies that the company has in force. If the company tends to lower the interest rates on policies as they get older, chances are good it will reduce yours, too. Make sure you compare the company's renewal rates in previous years to the rate on Treasuries and CDs for the same years. That way, you'll know whether it makes sense for you to purchase a particular SPDA.

Next time you are looking for annuity information and doing Google searches try putting her name in the search and you will normally find some very specific information detailed in easily understood language.

You can find more information from Suze Orman and other sources by Clicking Here.

You may wonder why annuities get so much attention. Why is it that insurance agents and financial planners find themselves advising their clients to purchase these instruments? While there are certainly some instances where purchasing an annuity may make financial sense, in most cases especially in retirement planning an annuity might only be a choice after all other avenues have been explored.

Annuities are a financial product purchased through an insurance company and so the most likely advice to purchase one would come from an insurance salesperson. However financial planners and certain brokers are licensed to sell these devices so you may be approached to buy or sell an annuity by a number of persons.

In the case of selling all or part of an annuity you own you should automatically be cautious if you are approached by an unknown person with an offer to purchase. Because these products can be extremely complex the average owner can be easily cheated if care is not taken. Certainly there are occasions such as unexpected illness or other financial difficulty where selling a portion or an annuity would be a good decision. However the owner is more likely to be under great stress at these times and more likely to make a careless decision.

As mentioned before any financial decision should only be taken after you have done some research and then contacted a trusted professional for advice. Care must be taken when choosing a trusted professional. In many cases the first choice would be your long time insurance salesperson, CPA or financial planner. However you must take care with these individuals also.

Certainly the majority of these professionals are ethical and honest or they would not still be in the business. However the unusually large commissions available through the sale of these products can cloud the sellers thinking when suggesting choices.

A commission earned for the sale of a mutual fund might be 5% with a .25% commission per year after the sale. Traditional financial planner charges might be in the area of 1% depending on the size of your investments.

However the commission sales for annuities can pay a hefty 12% upfront commission to the seller. Additionally in the case of insurance salespeople they may be under tremendous pressure from their company to sell these products. These substantial commissions in comparison with the compensation they normally receive are a very great inducement to at least suggest them as a possibility.

As usual the best defense is knowledge. Doing a little research before contacting your chosen professional will give you the information you need to question their choice of financial instruments. Proper investing can expand your financial circumstances and allow you to enjoy the fruits of your labor for many years. Just make certain that you are well informed before making final choices