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Planning Your Retirement: Annuities

Annuities (FINRA)

"An annuity is a contract between you and an insurance company in which the company promises to make periodic payments to you, starting immediately or at some future time. Some annuity contracts provide a way to save for retirement. Others can turn your savings into a stream of retirement income."

Types of Annuities

What Are Annuities? Types of Annuities & How They Work (The Balance) 

"An annuity is an insurance contract. Many people think of an annuity as an investment, but when you purchase an annuity, you are buying an insurance policy. You're ensuring an outcome."

Annuities: Insurance for Retirement (The Balance)

"An annuity is a financial product that pays out a fixed stream of payments to an individual, and these financial products are primarily used as an income stream for retirees. Annuities are contracts issued and distributed (or sold) by financial institutions, which invest funds from individuals. They help individuals address the risk or outliving their savings."

Pros and Cons:

Advantages of Annuities vs the Disadvantages (The Balance)

Getting the Whole Story on Variable Annuities: The good, the bad, and the ugly (Investopedia)

"If you have maxed out your annual contributions to your 401(k), IRA, or other tax-deferred retirement accounts, you may now be looking into a variable annuity. But before you buy one, consider all the benefits and shortcomings of these complicated insurance products."

The Pros and Cons of Annuities: They can provide income for life, but often at a high price (Investopedia)

"Insurance agents and financial advisors have been investing their clients’ retirement money in annuities for decades. That practice has its detractors, with the criticism usually focusing on the high commissions paid to annuity salespeople and stiff fees charged to annuity owners year after year. Here's a rundown of the pros and cons of annuities, compared with other ways to invest for retirement."

 

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