Annuities – A Wiser Investment Scheme for Your Retirement

If you are worried about your life after retirement, you should first know how you can invest money and get considerable returns in exchange. You are earning a lot of money now and will soon retire after few months. What will you do then? Will you depend on your sons or make your own living? It’s quite obvious that you will always want to keep your head high and meet your own expenses even after you leave your job. Annuities are of great help to retirees as they can earn a lot of money annually with these insurance policy schemes or contracts.

Fixed annuities are one such type of annuity from which you can gain a huge amount of money with a minimal rate of interest and the money is guaranteed by the insurance companies. These types of annuities are very beneficial as they convert the premium money into bonds and the retirees obtain huge returns out of these.

Types of annuities rates

There are two types of annuities rates- fixed annuity rates and variable annuity rates. Fixed annuities rates differ from variable annuities rates >at a basic point. The fixed annuities guarantee a specific rate of return and the insurance companies invest the money in fixed rate of assets which are nothing but treasury bills and bonds.

Variable annuities rates are mostly related to the stock markets. However, the income from such annuities is not meager at all. The fixed annuities give out income to the individuals on a fixed basis and such insurance policies are an excellent investment plan for your retirement.

Factors relating to the rates of annuities

The principal amount of an immediate annuity differs from one policy to another and it also considers at what speed it requires to be paid. If you need to buy a fixed annuity scheme, you need to verify your credit history and the employment status by the insurance company which is actually paying you the policy. There are some insurance companies which regulate their annuities rates depending upon the age, gender and the health of the customers. You should therefore keep these factors in mind while opting for fixed annuities from the insurance companies.

Certain considerations

You should choose a policy which has a close period of annuity rates and a specific length of surrender period. A disparity in ratio of 2 to 1 signifies an inferior policy. You should do an extensive research and evaluate the insurance company from which you are taking the policy.

Annuities can also be used to pay off your past debts as you get immediate returns with such an investment scheme. You get monthly installments and thus can pay off your debts in a monthly basis by making monthly payment to your money lenders. In this manner you can secure your retired life and be tension free.

Authors Bio: The author here says why immediate annuity is a beneficial scheme for prudent investors. With an Immediate annuity, you can always make your retirement days colorful.

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