An annuity is a contract between you and the insurance company by which you make a lump-sum payment or series of payments. In return, the insurer agrees to make periodic payments beginning immediately or at a set date down the road. Keep reading to learn about the different types of annuities and the benefits of having such a contract.
Investing in employer-sponsored 401(k) and 403(b) plans is important for your future financial stability during retirement. Yet, contributions to these plans are limited and may not provide enough income throughout your golden years, especially if you begin saving later on in life. As such, an annuity may be a viable option for maintaining your financial security in retirement.
There are three main types of annuities, including:
Having an annuity can help you:
Look at your immediate and long-term financial needs to determine if you can afford to open an annuity. Should you have a sudden need for cash, you can usually withdraw a small amount from a deferred annuity without suffering a penalty. However, you will likely suffer a penalty if you withdraw a significant amount of money after only a few years of having an annuity. For additional lifestyle and financial well-being guidance, contact us today.
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