logo for annuities-financial-planning.com
leftimage for annuities-financial-planning.com

Annuity: Essential to Your
Retirement Financial Planning


Crucial to your retirement financial planning...

An annuity is an amount of cash that you receive for money invested. The amount that you invest resides with an insurance company. Through annuity ratings, the strength of insurance companies are assessed. They are also state regulated to maintain sufficient reserves and capital. 

(See also annuity insurance.) 

The insurance company is responsible to see that you get paid the agreed upon amounts. Annuity definition.

If you are a lotto winner, and you receive money in equal installments, then that is an annuity also (because someone else invested the money).

First, there are two basic types of annuities: Deferred or immediate.

    • Deferred: Lets your money grow until you are ready to retire (after age 59 ½). The interest you make is tax deferred until you take money out.

    • Immediate: Provides income right away to you—as fast as within a month of the start of your investment.

        Annuities can be paid out in two basic ways:

a. Ordinary: The payments occur at the end of a period.

b. Annuity Due: The payments occur at the beginning of each period. (An example is a lease payment due at the beginning of each month.)

Second, the interest can either be fixed or variable:

    • Fixed: Provides a guaranteed interest rate for a specified term.

    • Variable: Allows you to make choices on how your money gets invested. One benefit is that you can switch funds to different investment options without worrying about taxes or capital gains.

Third, some features and benefits overall:

    • Tax Benefits: Your annuities are not taxed until payouts begin.

    • Sell or Cash Out: Under the right conditions, your annuities may be sold or cashed out. There are companies to help you do this.

Immediate Or Deferred?

Do you want to defer your annuity and let it grow to a large retirement reserve?

Or, do you want to acquire immediate monthly income in the near future?

Get a free annuity quote and find out what you can do!

Or, get a free consultation from a
Certified Financial Planner to help you make the best decision for your needs.

"You'll be glad you did the right thing!"

Go to Annuities Blog

Return to Annuities Financial Planning


footer for annuities page