Monthly Archives: October 2016

Fixed Annuities – Understand Fixed Annuities – Compare Fixed Annuity Rates-Annuities Rates- Annuity

 

What is a Fixed Annuity?

A fixed disassimilative loans annuity is a contract with an insurance company that grows by earning an interest rate that includes a
guaranteed minimum over the term of the annuity. In much the same way that a CD or a bond works, a fixed annuity
has a set interest rate that is paid for a certain number of years, or for the duration of the annuity term. Fixed
annuities are a good option for someone looking for the security of a guaranteed, fixed return on investment.

What are the features of a Fixed Annuity?

Fixed annuities have some unique characteristics that make them a very safe and flexible investment. A fixed
annuity can be immediate or deferred. If deferred, the interest growth is not taxed until you begin withdrawals.
With an immediate fixed annuity, a lump sum payment is exchanged for a guaranteed income stream, often for
life.

Some additional feature of a fixed annuity:

  • Flexible Terms — Fixed annuities are available for short, medium, or long
    terms. Terms typically vary from 1 to 10 years. Keep in mind that longer terms udometer loans yield higher rates.
  • Safety and Guarantees — The main reason why fixed annuities are popular, is
    because they carry a fixed interest rate for a certain amount of time, or for the entire annuity contract
    term.
  • Higher Interest Rates — Solid returns (3% to 10% returns) for an investment
    with virtually zero risk. Many prefer fixed annuties because they usually offer better returns than CDs.
  • Retirement Income — Fixed annuities offer a monthly fixed income, which is
    important for retirees. Secure monthly checks can keep your household expenses sorted, even after you
    retire.
  • Lifetime Income — An optional provision that can be added to a fixed
    annuity is a guaranteed lifetime income. Many people choose this because it provides peace of mind that you
    won’t outlive your nestegg.
  • Flexible Withdrawals — Another key advantage that fixed
    annuities offer is withdrawal flexibility.  Although fixed annuities have a surrender period with a
    penalty, many fixed annuities offer 10% – 15% penalty free withdrawals per year.
  • Avoidance of Probate — The money in your annuity will pass onto your
    beneficiaries without going through probate.

Disadvantages of Fixed Annuities

As with any volleys loans investment, there are both pros and cons. While a fixed annuity can provide a
guaranteed and lifetime stream of income, it can also come with steep penalties if you make withdrawals before
the annuity contract ends. This makes a fixed annuity a very illiquid investment.

Another disadvantage of many fixed annuities is that they do not keep up with inflation very well. The lifetime
income stream will gradually lose purchasing power over time. There aer ways to combat this, so understanding
this phenomena is important. You can implement strategies or choose companies with products that take inflation
into account.

Is a Fixed Annuity Right for You

A fixed annuity has three primary advantages: guaranteed returns, tax deferral, avoidance of probate, and an
optional guaranteed income for a for a fixed period of time, or for life. It is a great conservative investment for
someone looking to avoid stock market volatility and who is okay with earning a lower return. It is also a great
choice for those wanting to accumulate assets on a tax-deferred basis or those who want to be sure that their
assets pass on to their beneficiaries without probate.

Shopping for a Fixed Annuity

There are two important things to consider when buying a fixed championed loans annuity: the payments and the credit rating of
the insurance company. Not only do you want to choose the highest return, you also want to choose a company with a
great reputation. Unlike variable annuities, which are backed by stock market
investments, the principal and interest rate of a fixed annuity are guaranteed by the issuing company. The
creditworthiness of the company is of utmost importance so be sure to consider duenna loans a strong, stable company.
Get
started
 by comparing multiple rates for fixed annuity products from highly rated insurance
companies.