The Perfect Annuity Advice

Every investor has different goals, different needs, and a different time frame. The sheer amount of various annuity products being offered present a challenge to determining what is right for you, not what the insurance company wants to sell you. Before sitting down with your insurance agent you will want to do your homework and understand how annuities work.

Going back to our first question - will an annuity help you reach your financial goals? Regardless of your situation, the answer is yes. An annuity is an investment tool to help everyone provide income for themselves in retirement. There are many benefits to annuities:
1. Safe Place for Cash
2. Reasonable Growth
3. Tax Deferment
4. Guaranteed Lifetime Income

I think you will agree that everyone is looking for the above traits when planning for retirement. The closer you get to retirement in fact, the more you are concerned with the safety of your money. While cash is the ultimate safe place, if you park it in a savings account you will not realize any growth on your cash. Annuities, however, can earn you twice what you can make by putting your money in a money market account or CD. All of the earnings on these bank accounts will also be subject to being taxed. But insurance company annuity earnings are tax deferred. The final factor, guaranteed lifetime income, will put to rest any worries you have about running out of money in your golden years.

The second part of our question is how do you determine which product is right for you? As with any product, there are strong and weak products available. And while you may want to rely on advice from your financial advisor or insurance sales agent, a respectable one can be hard to come across. Factors to consider when researching products include: surrender fees, guaranteed interest rates, and credit ratings of the company itself. All of these different aspects can be hard to wade through.

It can be helpful for you to first determine the importance of each factor to you. You can then grade each factor appropriately and narrow down which products best align with your financial goals. You will want to be sure that all your important needs are met within the contract.

Annuities can help everyone reach their retirement goals. Finding the right product for your time of life and your situation makes all the difference. With a little bit of homework and due diligence you will ensure your income in your golden years.