When reaching retirement, many people buy an annuity, which essentially transforms the money in the retirement fund into a regular income. There are different annuity types that can be found on the market, including:
It is important to weigh all options when deciding on a retirement plan. As we have already mentioned a variety of annuities are available and it is important to find the right one. After choosing an annuity it cannot be changed or exchanged. After our investigation, we have found that people who take the first annuity offered by their pension fund generally receive on average $100 less a year than those who have taken the time to shop around. This might sound like much, but over the years of retirement this will add up.
A Life Annuity may be bought in one purchase or be paid into overtime. The Life annuity arranges for a predetermined set of payouts from the time of retirement until the time of death, usually on monthly bases.
A Single Premium Annuity is an investment, which grows on a tax deferred bases until it can be withdrawn and then payments are made over the course of the retirement. The owner must pay for a single-premium in a single payment.
This annuity is designed for married couples and ensures that payments will continue to be made until the death of both spouses.
This annuity is a contract for a fixed dollar payment from the time of retirement until the time of death, both earnings and principal is guaranteed. For those looking to receive a fixed income, this is a good option.
In the event of illness or life health problems, you may be eligible to receive higher payouts due to lower life expectancy. This can include cancer, diabetes, kidney or heart failure, stroke, multiple sclerosis or other debilitating and life shortening diseases.