Page 1

==== ==== Financial Planner in Scottsdale, Investment Planner, Annuity Planner http://arizonafinancialplan.com/a-bulletproof-portfolio-for-investments/ ==== ====

What are fixed annuities? Many of us have heard of them or seen commercials about them but we really don't know what they are or how they work. Fixed annuities are insurance contracts that you pay in to over a set period of time (all at once or monthly over a few years) that will guarantee the annuitant a certain amount of income over a certain period of time and at regular intervals. Most commonly, these are used by those who are close to retirement or those who have retired already. Fixed annuities can be bought from an insurance outlet or other financial company. They can be purchased using a lump sum payment, usually from your savings, or you can pay into an annuity over a period of time whilst you are still working until your annuity reaches the agreed upon amount. The money that you invest will be guaranteed to earn a fixed rate through the accumulation stage. As the money is paid out the remaining money in the 'pot' will continue to gather and earn money at this same fixed rate of return. In some cases the annuitant will not live long enough to claim the entire annuity. When this happens, they will actually end up passing the remaining sums of money in the annuity onto the company that sold it to them, which is one of the risks with annuities. On the other hand, if you live longer then you will continue to collect regular monthly payments even beyond the amount you paid in. The insurance companies base their payment rates on the average lifespan of their customer so even though they may lose money on you if you live a long life they will make out over time. There are lots of different types of annuities that you can get. The two main types are life annuities and term certain annuities. With a life annuity, you will be able to get a fixed payment which is determined by you all the way up until your death. With a term certain annuity you will be receiving these payments over a fixed term, usually each month, until the period of the annuity is completed. With these you may often find that the annuitant fails to receive all of the annuity if they pass away beforehand.

There are many other varieties of annuities but these days most people are interested in the guaranteed annuity which provides a safe income stream throughout retirement. If you would like more information then please visit our website Annuities Explained to learn more about how annuities work and whether or not they are a smart investment option for you.

Article Source:


http://EzineArticles.com/?expert=Jeff_Williamson

==== ==== Financial Planner in Scottsdale, Investment Planner, Annuity Planner http://arizonafinancialplan.com/a-bulletproof-portfolio-for-investments/ ==== ====

Annuity Specialist in Scottsdale, Tom Fischer  

Tom Fischer is an Annuity Specialist in Scottsdale Arizona, specializing in investments and annuities.

Read more
Read more
Similar to
Popular now
Just for you