Annuities May Be Suitable for Your Investment Plan

Are you worried about outliving your income? That’s a risk that you may be able to  do something about. When you invest in an annuity, you set the stage to receive income in the future, subject to the terms, conditions and or limitations of the insurance contract.

How do annuities work?

An annuity is a long term investment that is issued by an insurance company designed to help protect you from the risk of outliving your income. Through annuitization, your purchase payments (what you contribute) are converted into periodic payments that can last for life.

Annuities are flexible so you can choose one that enables you to:

• Invest a lump sum or invest over a period of time 
• Start receiving payments immediately or at some later date
• Select a fixed, variable or indexed rate of return

What type of annuity could fit into your investment plan?

Whether your needs are immediate or long-term, you can choose the type of annuity whose features work for your situation:

• Variable – With a variable annuity, you choose investments and earn returns based on how those investments perform. You can choose investments that offer different levels of risk and potential growth, depending on your investment goals and tolerance for risk.
• Immediate – An immediate annuity is usually purchased with a lump-sum and guaranteed income starts almost immediately.
• Fixed – With fixed annuities, the principal investment and earnings are both guaranteed and fixed payments are made for the term of the contract.
• Fixed Indexed – This special class of annuities yields returns on contributions based on a specified equity-based index, such as the S&P 500.