A Fixed Annuity Provides Income Stability
Maybe you’re preparing to retire or perhaps the income you earn is somewhat irregular and you want a source of income on which you can depend. No matter your reasons, a fixed annuity could be the perfect solution.
With a fixed annuity, an individual deposits a sum of money under the pretense that it will be invested and allowed to grow until it is then paid back to them, their spouse or beneficiary in regular, fixed amounts, for either the remainder of their life or a pre-determined term, depending on the preference of the annuity holder.
How much will a fixed annuity payout
The amount a person would receive in payments from a fixed annuity depends on the amount of money they initially deposited, as well as their age, gender, and the going interest rates. A fixed annuity differs from a variable annuity in that the payments are consistent in size.
Two types of fixed annuities
There are two types of fixed annuity; term certain annuities and life annuities. While term certain annuities pay a particular amount of money usually on a monthly basis until the expiration of the annuity term (which is determined by the annuity owner), life annuities provide regular payouts for the remainder of the annuitant’s life. There are a number of different types of life annuity which an individual may choose according to their specific needs.
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For some, whether to choose a life or term certain annuity depends on their budget, income needs or other lifestyle factors. The choice is yours and it is one that deserves careful consideration.
While a fixed annuity is most often chosen as a way to guarantee some amount of money during retirement, they can also be beneficial as ways to save on or defer taxes during the accumulation phase. No matter your reasons for choosing to learn more about a fixed annuity, be sure to seek help you can trust. Owning and using an annuity in the smartest and most beneficial way possible can be somewhat complicated so seek out the expert advice you need.