Here are 7 Things That You Should Ask When Buying An Annuity:
What are the terms of the annuity policy?
Each annuity policy has it’s own set of terms, but in most cases the annuity can fall into one of four types: index annuity, fixed indexed annuities, variable annuities and traditional annuities. We recommend that our clients avoid investing in traditional annuities and be caution when choosing a variable annuity. Our preference is to take a complete look at all your retirement assets, including:
- Money That You Have Invested In the Stock Market
- Your Retirement Savings Portfolio
- Social Security Benefits for You and your Spouse
- Your Spouse’s Income and Assets As They Apply
- Your Age
- How Much Money Of All Should You Have Protected
- What Amount of Income Makes Sense for Your Annual Payments from The Annuity
- Is a Fixed Indexed or Index Annuity the Right Choice for you at this time?
Is it a fixed index annuity?
We prefer to see our clients air on the side of safer than sorry and so, recommending a fixed indexed annuity or an index annuity with a nice bonus and a guarantee for your annual payment amount is a smart choice in most cases.
How long will I pay in before receiving the annual retirement payments?
The amount of payments, duration and withdrawal eligibility depend on your age and the terms of your annuity policy. I personally meet with each and everyone of my clients before we take any route towards the details of one particular annuity. Often our first session is a great time for us to get to know each other and discuss your assets and your retirement plans. Investing for Retirement is no small task and protecting the right portion of the money that you have accumulated throughout your life is key to making sure that you will not run out of money during the golden years of your life. The amount that you pay also depends on how much your initial principal payment is for.
We are happy to walk you through some case studies and using your actual information we can provide you with an in-depth retirement planning strategies analysis.
What makes an annuity a safe and secure choice when investing for retirement?
An annuity is a retirement investment vehicle but it is actually also an insurance policy. The annuity policy is what protects your principal investment from a down turn in the stock market.
How does my principal investment stay protected?
The annuity policy offers a guarantee on the annual payments for your retirement pension. Any additional profits made from the index using an index annuity can become the source for disbursement payments if the sum is greater than the projected annual withdrawal amount. Each annuity policy has slightly different terms but ultimately the annuity policy is an insurance policy based on the amount of money agreed to be invested. The guarantee is backed by the insurance company that provides the annuity policy for the customer.
Will my spouse receive the same dollar amount benefit from my annuity even if I die first?
Yes, if you have selected an annuity that we sold you, in most cases you will have the option that your spouse receives entirely the same annual payment amount from the annuity as stated in the annuity policy that you purchase. Each annuity policy has slightly different terms, we’re happy to answer any questions that you may have regarding any type of annuity that would suit your needs.
What is the maximum that I can withdraw annually in retirement without paying penalties?
Generally speaking in California, you can withdraw up to 10% annually from the annuity policy without paying a penalty or fees. Your annuity remains liquid in the event that you need to close it completely, but the fees and charges for an early withdrawal that do not meet the terms of the annuity policy can be hefty and costly. As you might see when taking an early withdrawal from other retirement savings accounts like a 401K or IRA.
