Are you tired of watching your investments fluctuate daily? Do you want stable income regardless of market conditions? An annuity could be the solution for you. Annuities provide safety and diversification, protecting your principal and earned interest within a comprehensive investment plan.
Annuities can enhance your portfolio and cash reserves, offering benefits such as tax-deferred growth, principal guarantees, lifetime income streams, protection from creditors, and probate avoidance. They can be used both before and after taxes, including assets from IRAs, 401(k)s, 403(b)s, pension rollovers, tailored to individual or joint life needs.
There are various types of annuities available, each with unique features. From simple fixed-rate annuities with multi-year rate guarantees to options like longevity annuities, index-linked annuities, immediate annuities for single or joint life, and variable annuities.
Understanding these differences is crucial before making any long-term decisions, just as you would when adjusting your investment plan.
Many annuities come with additional features. Some of these are included at no extra cost, while others require an additional premium. A common feature is a death benefit, which ensures that if the annuitant passes away before receiving all their contributions back, the remaining funds are paid to a named beneficiary. This death benefit can be taken as a single lump sum or as a stream of payments. However, unlike life insurance death benefits, annuity death benefits are typically taxable.
Another feature found in many annuities is a terminal illness or nursing home waiver. These waivers allow the annuitant to access funds from the annuity penalty-free if they are diagnosed with a terminal illness or need to reside in a nursing home for a certain period of time.
For more information on annuities, visit FINRA’s Guide to Annuities.