Sunday, August 21, 2011

What Choices do I Have When I Buy an Annuity?

Many people who buy life annuities add one or more of these three options:
  1. Joint-and-last-survivor option
    This option appeals to couples. Payments continue as long as either you or your partner lives. Sometimes you can get higher monthly payments while both partners are alive. After one dies, the payments to the surviving partner go down. The thinking is that one person will need less income than two.
  2. Guaranteed benefit
    This option guarantees a certain number of payments. For instance, let’s say you choose a 10-year guarantee. What happens if you die before the 10 years are up? Your loved ones or your estate will get the rest of your payments, or they may receive a lump sum of equal value. Of course, if you live past the guarantee period, you will still receive payments for life.
  3. Indexed annuity
    This option means your income goes up as prices rise. This is important because after five, 10, or 15 years, your monthly income will buy a lot less than it does today.
  4. Choosing the right annuity:
  5. Remember: There are lots of options for annuities today.

They may lower the size of your monthly payment, but they may make an annuity work better for you overall. For more information, contact us at Annuity Liberty!

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