What are Annuities?
Types of Annuities
There are several types of annuity products available to choose from. So whether you’re looking for income options, legacy planning tools, or spousal protection, your financial professional can tailor a plan to meet your specific goals.
Variable: There’s the potential for more earnings, but you also take on more risk.
Registered index-linked:Â Exposure to downside risk is limited, and there is potential for increased earnings based on index growth.
Fixed:Â Your investment grows based on a guaranteed rate of return.
Immediate:Â Convert a lump sum of money into a stream of income.
Fixed indexed: The potential for increased earnings is based on index growth, but there’s still downside protection.
How can Annuities be beneficial for you?
Annuities can be an excellent investment for you if your situation is such that the income from traditional sources does not meet all your needs.
Think of an annuity as a long-term investment with monthly payments. It is a predictable stream of income that pays out money over time, so you don’t need to worry about running low on funds or having to use other assets.
One of the key benefits of an annuity is that it allows the investor to save money without paying taxes on the interest until a later date. In addition, unlike 401(k)s and IRAs, annuities have no contribution limits.
The risk involved in Annuities
Like any investments, annuities carry risks. For example, if you pass away before the payout period, you miss out on annuity payments. In addition, taking money out of your annuity account may not be easy after you’ve invested it. Therefore, investors should research the insurance company that is underwriting the annuity. Risks include:
Consult with us to understand annuities better. Contact us today to know more about how annuities can help!
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