Which is better for you, Immediate or the fixed annuities?
By: Mike Anderson
Submitted: 2011-08-01 22:19:42 | Word Count: 534
Who wouldn't want to lead a stress free, tension free lifestyle, especially after the retirement? But to ensure a relaxed life post retirement, you must secure your financial future. If you think about the risk that the investments might bring with it, then there are some plans that offer maximum benefits with minimum risks. The immediate annuities that involve the payment of one single premium and offers good returns can be one of the premium choices.
The annuities are of many types like the fixed, variable, immediate, deferred, qualified or unqualified etc. The income annuity is a type of immediate annuities. In this type of income annuity, the investor receives the amount that he invested along with the interest that has accrued through the immediate income after a certain regular periodic gap. The immediate annuities are known as the single premium since you are required to deposit a certain lump sum so as to make sure of the security in terms of his finance.
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These kinds of income annuities is considered as one of the best option for the retired people as you can receive a few back to back payments after you retire. The market research that was conducted in the recent times along with the opinion from the experts say that the it is always wise to make proper research before investing in the income annuities. Let's suppose that you win a huge amount in a law suit. It is like rags to riches story. If you are wise enough to invest that amount into the income annuity, then you can gain a superb financial stability after your retirement as it guarantees you a regular payment.
The income annuity or any kind of immediate annuity guarantee you returns that are going to last you a lifetime. There are certain factors that determine the rate of income that you can make from such immediate annuities. Those factors are, your age, the amount of single premium that you are paying at the time of the investment and also the rate of interest that the investment company is paying on that income annuity scheme. The more your age, the optimum is your benefits in terms of the income annuity. But again, if you have an outstanding balance on the mortgage payment of your property, then you must try to clear all the dues before investing in an income annuity. Else the income annuity is not the right kind of choice for investment in such cases.
Though all of us have different reasons to invest in annuities, but the income annuities can act as the correct kind of investment tool for people who are about to retire or those who are already retired. The only criterion that you must fulfil to invest in an annuity is to be more than 55 years of age. If you do not have any specific plans for your future, if you do not receive enough pensions from your government, then the immediate annuities are the best choice for you.
