weather

Weathering the storm in an uncertain market

Tired of watching the stock market and seeing the value of your investments fluctuate on a daily basis? Consider purchasing a deferred or immediate annuity to protect and grow your savings into the future.

An annuity is a contract with an insurer that provides an income for life, a specified number of years, or a combination of the two. Annuities can offer diversity and safety when part of a holistic investment plan and can protect your principal and interest earned.

Before you purchase an annuity, consult with your legal, tax, investment and insurance advisers, just as you would before making any changes in your investment plan. Understand the differences between the types of annuities available.

DEFERRED ANNUITIES

Deferred annuities offer several advantages, including a guaranteed minimum interest rate for the life of the contract, tax-deferred growth, no up-front sales charges or fees and flexible withdrawal options. Another advantage is that if you die with remaining funds, a typical annuity bypasses probate and passes directly to your named beneficiary. Flexible payout options allow you to choose a monthly payment for the rest of your life; for a specific time period (called period certain); as joint payouts that can pay a survivor after your death; or a combination.

IMMEDIATE ANNUITIES

Immediate annuities require an upfront lump-sum payment for a guaranteed lifetime income amount. These payouts can be arranged to go solely to the owner or can have a provision to pay for a specified period of time or to another person. The important thing to remember with a life-only payout is that when you die, no further payments are made. When purchasing an immediate annuity, consider your life expectancy and the necessity of money being passed along to heirs if an unforeseen death occurs.

No matter if you choose a deferred or immediate annuity, guarantees of interest rates, income or principal are the main advantages to purchasing this type of investment. Safety and peace of mind go hand-in-hand with incorporating an annuity into an investment portfolio.