News :The Annuity Investment
An annuity is an investment vehicle issued by insurance companies. It is designed to provide the owner with a steady income stream over an extended period of time. In its simplest form, an investor would pay a lump-sum payment to the insurer who would then provide a guaranteed monthly payment to the investor for the rest of his life.
Photo: annuitiesguide.com
When it comes to annuity investment guides what we have tried to do is offer the truth. Annuity is a no-nonsense approach about the good, the bad and the ugly of fixed annuities, variable annuities, equity index annuities and even life insurance to minimize estate taxes. Therefore, it was written because people need to know the truth about their annuities. They nee! d to know the dirty little lies insurance agents are using to sell annuities.
There are generally two types of annuitiesfixed and variable. In a fixed annuity, the insurance company guarantees that you will earn a minimum rate of interest during the time that your account is growing. The insurance company also guarantees that the periodic payments will be a guaranteed amount per dollar in your account. These periodic payments may last for a definite period, such as 20 years, or an indefinite period, such as your lifetime or the lifetime of you and your spouse.
It is outrageous to see so many people fooled by their investment counselors and financial advisers. One section actually talks about how to tell a good agent from a bad agent. Furthermore, it just tells in plain English what annuities are good for and what annuities are not good for. It is similar in concept to a traditional pension plan that is designed to provide retirees with a st! eady monthly income after they've stopped working. People can ! actually read this annuity investment guide and walk away feeling at least knowledgeable in the area of an annuity.
There are many elements to an annuity:
(a.) Timing of first payment. An immediate annuity begins paying the annuitant immediately. A deferred annuity will begin making payments at some time in the future, as specified in the annuity contract.
(b.) Premium structure. A single premium annuity refers to the case where the investor makes a single lump-sum payment to the insurer. All immediate annuities are single premium annuities. In the case of a fixed premium annuity, the investor makes consistent periodic premium payments to their account. And finally, a flexible premium annuity allows the investor to make contributions of varying amounts whenever he wants.
(c.) Investment types. A fixed annuity earns a specific minimum rate of interest for a certain number of years. Thereafter, the interest rate may change, but will still be subject t! o a guaranteed minimum rate. A variable annuity offers a number of investment options. Typically, investors can choose among several portfolios of stock and other market-based investments. Equity-indexed annuities strike a balance between fixed and variable annuities. Their earnings are indexed to a major market index (such and the S&P 500), but still offer a minimum guaranteed return in the event the index declines.
(d.) Distribution options. A straight life annuity provides a monthly income as long as the annuitant lives. A period certain guarantee ensures that payments will continue for a specified number of years (usually 10 or 20), even if the annuitant doesn't live that long. The specified income option allows the owner to specify the payment amount he desires, and the insurance company will calculate how many payments he will receive. The specified payment period option allows the owner to specify the number of payments he would like to receive, an! d the insurance company will calculate the amount of each paym! ent.
Photo: Nick Gillham
Variable annuities are securities regulated by the SEC. Fixed annuities are not securities and are not regulated by the SEC. Equity-indexed annuities combine features of traditional insurance products (guaranteed minimum return) and traditional securities (return linked to equity markets). Depending on the mix of features, an equity-indexed annuity may or may not be a security. The typical equity-indexed annuity is not registered with the SEC.
Most insurance companies charge an annual administrative fee for maintaining an annuity account. With fixed annuities, this is usually a flat fee. With variable annuities, it is a percent! age of the value of the separate accounts plus an annual charge.
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Photo: annuitiesguide.com
When it comes to annuity investment guides what we have tried to do is offer the truth. Annuity is a no-nonsense approach about the good, the bad and the ugly of fixed annuities, variable annuities, equity index annuities and even life insurance to minimize estate taxes. Therefore, it was written because people need to know the truth about their annuities. They nee! d to know the dirty little lies insurance agents are using to sell annuities.
There are generally two types of annuitiesfixed and variable. In a fixed annuity, the insurance company guarantees that you will earn a minimum rate of interest during the time that your account is growing. The insurance company also guarantees that the periodic payments will be a guaranteed amount per dollar in your account. These periodic payments may last for a definite period, such as 20 years, or an indefinite period, such as your lifetime or the lifetime of you and your spouse.
It is outrageous to see so many people fooled by their investment counselors and financial advisers. One section actually talks about how to tell a good agent from a bad agent. Furthermore, it just tells in plain English what annuities are good for and what annuities are not good for. It is similar in concept to a traditional pension plan that is designed to provide retirees with a st! eady monthly income after they've stopped working. People can ! actually read this annuity investment guide and walk away feeling at least knowledgeable in the area of an annuity.
There are many elements to an annuity:
(a.) Timing of first payment. An immediate annuity begins paying the annuitant immediately. A deferred annuity will begin making payments at some time in the future, as specified in the annuity contract.
(b.) Premium structure. A single premium annuity refers to the case where the investor makes a single lump-sum payment to the insurer. All immediate annuities are single premium annuities. In the case of a fixed premium annuity, the investor makes consistent periodic premium payments to their account. And finally, a flexible premium annuity allows the investor to make contributions of varying amounts whenever he wants.
(c.) Investment types. A fixed annuity earns a specific minimum rate of interest for a certain number of years. Thereafter, the interest rate may change, but will still be subject t! o a guaranteed minimum rate. A variable annuity offers a number of investment options. Typically, investors can choose among several portfolios of stock and other market-based investments. Equity-indexed annuities strike a balance between fixed and variable annuities. Their earnings are indexed to a major market index (such and the S&P 500), but still offer a minimum guaranteed return in the event the index declines.
(d.) Distribution options. A straight life annuity provides a monthly income as long as the annuitant lives. A period certain guarantee ensures that payments will continue for a specified number of years (usually 10 or 20), even if the annuitant doesn't live that long. The specified income option allows the owner to specify the payment amount he desires, and the insurance company will calculate how many payments he will receive. The specified payment period option allows the owner to specify the number of payments he would like to receive, an! d the insurance company will calculate the amount of each paym! ent.
Photo: Nick Gillham
Variable annuities are securities regulated by the SEC. Fixed annuities are not securities and are not regulated by the SEC. Equity-indexed annuities combine features of traditional insurance products (guaranteed minimum return) and traditional securities (return linked to equity markets). Depending on the mix of features, an equity-indexed annuity may or may not be a security. The typical equity-indexed annuity is not registered with the SEC.
Most insurance companies charge an annual administrative fee for maintaining an annuity account. With fixed annuities, this is usually a flat fee. With variable annuities, it is a percent! age of the value of the separate accounts plus an annual charge.
Thanks To :
bad credit auto, payment loan,
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