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Why would a deferred annuity or annuities due be preferred as a retirement investment?
Wiki User
∙ 10y ago
There are many factors you need to consider to determine what is your best option. Your risk tolerance, how much money you have to invest, your timeline in retirement, and if you have enough years to recoup a large loss in an investment to stay on track for your retirement. If you are in the growing phase a mix of a number of products is suggested. If you are closer to retirement age, look at safer products.
Wiki User
∙ 10y ago
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Should I buy annuities before retirement?
There are many types of annuities that you can buy. They are generally divided into two main types: immediate and deferred. After that there are also fixed or variable annuities. In general the variable annuities are used for retirement. But do not just buy annuities without realizing what they are. You need to make a long term investment plan if you want to really benefit from. It is best to create this as soon as possible, rather than after you are retired. As with all investments there is time involved.
What are the different types of annuties available?
There are two types of annuities. The first type is called deferred annuity, with that annuity your money is invested until you are ready to make withdrawals, for example - after retirement. The second type is called immediate annuity, with that annuity you receive money soon after your investment.
Where can one find the definition of deferred annuities?
Deferred annuities are either fixed or variable. A deferred annuity is where one deposits funds with an annuity company. Taxes on any financial gains made by your investments are deferred until you withdraw your funds.
What is the difference between immediate annuity and deferred annuity?
First, the word "annuity" can be used for different things. Be sure to know what you're working with. Annuities are investments through insurance companies. There are good and bad. Annuities might ALL be called "deferred" because their earnings are tax deferred. You pay taxes on the earnings when you take money out. The IRS sets the rules. Annuity earnings WILL BE taxed, even if received in monthly payments or passed on to beneficiaries. Immediate and deferred refer to 2 different features of annuities. Deferred is taxes. Immediate is payments. If you place a lump sum with the insurance company, they can start paying you monthly payments based on that lump sum. If the payments start immediately, it is called immediate. If payments start later, it could be called deferred. Annuities can be wonderful or horrible, so do lots of good research.
Can a fixed annuity have a minimum interest rate and a flexible premium payment schedule?
Yes. ALL deferred annuities offer a guaranteed minimum interest crediting rate (although in a few contracts, that rate is zero). And all non-variable immediate annuities calculate the annuity payments using an assumed interest rate, so one could say that that rate is actually "guaranteed" (as the payments are). Some deferred annuities will accept only a single premium, and they're called "single premium annuities". Others will accept recurring premiums and are usually called "flexible premium annuities. Immediate annuities typically do not permit recurring premiums.
Should I buy annuities before retirement?
There are many types of annuities that you can buy. They are generally divided into two main types: immediate and deferred. After that there are also fixed or variable annuities. In general the variable annuities are used for retirement. But do not just buy annuities without realizing what they are. You need to make a long term investment plan if you want to really benefit from. It is best to create this as soon as possible, rather than after you are retired. As with all investments there is time involved.
What kind of annuities would you reccomend?
There are 2 basic types of annuities: deferred and immediate, and the right one depends on where you are in life. A deferred annuity will accumulate money while an immediate will allow you to receive payouts shortly after you've made your initial investment.
What are some good money saving tips for my retirement?
You should invest in your company's 401(k) retirement plan. These are tax deferred investment accounts that allow you to earn income tax deferred. You can also invest in your IRA for additional tax deferred growth.
What are the different types of annuties available?
There are two types of annuities. The first type is called deferred annuity, with that annuity your money is invested until you are ready to make withdrawals, for example - after retirement. The second type is called immediate annuity, with that annuity you receive money soon after your investment.
Where can one find the definition of deferred annuities?
Deferred annuities are either fixed or variable. A deferred annuity is where one deposits funds with an annuity company. Taxes on any financial gains made by your investments are deferred until you withdraw your funds.
Are tax deferred annuities exempt from civil judgment?
No.
What is the largest annuity payout possible?
Annuities with the Highest Immediate Annuity Payouts and the Highest Annuity Interest Rates available. Immediate Annuities, Fixed Deferred Annuities www.jdsannuities.com/ The largest annuity payout possible is about 50% of your investment. You must get really lucky and you should understand investments comes with risk.
Where online can one find the most reliable information about variable annuity ira?
Variable annuities are tax deferred investment accounts similar to mutual funds. Variable annuity IRAs use money in your IRA account to fund the principal for the investment, but keep in mind that IRAs are already tax-deferred. You can find unbiased information on variable annuities and variable annuity IRAs through FINRA. http://www.finra.org/Investors/ProtectYourself/InvestorAlerts/AnnuitiesAndInsurance/p005976
How much is the insured amount for variable deferred annuities?
That depends on your particular annuity.
What are fixed annuity rates?
Fixed annuities are essentially CD-like investments issued by insurance companies. Like CDs, they pay guaranteed rates of interest, in many cases higher than bank CDs. Fixed annuities can be deferred or immediate. The deferred variety accumulate regular rates of interest and the immediate kind make fixed payments - determined by your age and size of your annuity - during retirement. The convenience and predictability of a set payout makes a fixed annuity a popular option for retirees who want a known income stream to supplement their other retirement income.
Do I have to pay annual taxes on my fixed annuities?
No, fixed annuities are generally tax-deferred. You will pay taxes on it when you remove the money from the annuity. Fixed annuities are not taxed so no you would not have to. You can find out more facts about how they work by visiting www.moneymanagment.info.
What is the difference between immediate annuity and deferred annuity?
First, the word "annuity" can be used for different things. Be sure to know what you're working with. Annuities are investments through insurance companies. There are good and bad. Annuities might ALL be called "deferred" because their earnings are tax deferred. You pay taxes on the earnings when you take money out. The IRS sets the rules. Annuity earnings WILL BE taxed, even if received in monthly payments or passed on to beneficiaries. Immediate and deferred refer to 2 different features of annuities. Deferred is taxes. Immediate is payments. If you place a lump sum with the insurance company, they can start paying you monthly payments based on that lump sum. If the payments start immediately, it is called immediate. If payments start later, it could be called deferred. Annuities can be wonderful or horrible, so do lots of good research.
