Annuities 101

What Are Annuities?

Annuities play a very important role in retirement planning, enabling you to save money and taxes while eliminating the fear that you will outlive your savings. Basically an annuity is an investment contract or policy between you and an insurance company. There are many kinds of annuities - some tailored for income, some for future growth, and some as savings vehicles depending on your exact income and investment needs.

Annuities come in two different basic types: an immediate annuity and a tax-deferred annuity. With immediate annuities, you give a lump sum of money to the insurance company. Based on your age, life expectancy, and interest rates, the insurance company calculates how much they'll send you each month - no matter how long you live.

For tax-deferred annuities, typically you give the insurance company a lump sum of money, and it grows on a tax-deferred basis. Tax deferred annuities can be great because you don't pay any taxes on the earning or profits that are built up in the annuity until you take the money out. You can also add money to your tax-deferred annuity in various amounts over time, providing you with more flexibility for your investment portfolio.

For more information on types of annuities, selecting the right one, and determining if you qualify, please select from the links on the left. To request a free no-obligation consultation from one of our experienced financial advisors, please fill out the form that is accessible here. We provide service to more than 3000 cities across the US, and work to provide instant assistance wherever we can.