Retirement planning has changed dramatically throughout the years and will continue to do so.
With pensions becoming less common and the future of Social Security looking toward uncertainty, it is important that people take an active approach to preparing for their own income in retirement. To accomplish their retirement income goals, some people turn to immediate annuities.
What Are Immediate Annuities?
Before we get into the specifics of these products, we should outline annuities in general. An annuity is, at the most basic level, a contract between an individual and a financial company. The individual pays a premium that the institution will, at a predetermined date, return back to them with interest as a lump sum or as incremental payments.
Two kinds of Annuities:
There are two basic kinds of annuities, deferred and immediate, that determine how and when the contract will pay out.
Deferred annuity payments start at a later date, while immediate annuity payments begin as soon as weeks away from the date of the premium payment.
Immediate annuities are typically selected by people looking for steady income payments, and who need that income to start soon. Another attractive feature of these annuities is that they feature tax deferral, allowing the money to grow untaxed until you withdraw it.
Because so many companies offer immediate annuities with varied options, The Lloyd Group, Inc.’s independent structure allows us to help you find one that is optimal for you and your retirement needs.
More Questions? Call for Answers
If you have any questions about fixed annuities or you’d like to schedule a no-obligation, complimentary consultation, please contact our office today.
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Retirement Planning Kit
This helpful retirement kit includes three separate guides that address several topics you should consider when planning your retirement.