Annuities are designed to provide a steady stream of income throughout retirement. They’re like insurance for your savings, guaranteeing reliable income for years to come.
These useful financial tools can complement your current investment strategy to help secure your future, growing tax-deferred value at competitive rates to ensure a reliable income source throughout your golden years.
How Do Annuities Work?
An annuity is a contract between you and an insurance company—you make a lump-sum payment (or a series of payments) to the insurer, who agrees to make regular, consistent payments to you over time.
These payments can be made to you immediately or at a specified future date, depending on where you are in your retirement journey. Payments can last for a set number of years, or as long as you live.
The Benefits of Annuities
Annuities can guarantee retirement income, ensuring you don’t outlive your savings. Unlike other, riskier financial tools, annuities protect your retirement with consistent payments you can depend on for life.
Money in annuities enjoys tax-deferred growth, meaning you don’t pay taxes on it as funds accumulate over time. Some annuities provide protection against market losses, which preserves your initial investment.
You may even be in a lower tax bracket once you start receiving annuity payments in retirement, which could result in you needing to pay less in taxes overall.
With a guaranteed income stream, often providing higher income payments than individuals could safely withdraw from their own savings, annuities can simplify retirement planning and reduce the stress of managing investments, especially as you get older.
No matter what your retirement journey looks like, annuities can be customized to fit your specific needs with a variety of riders and options.
Choosing the Right Annuity
The right annuity can provide a secure income stream for peace of mind throughout retirement. Selecting an appropriate annuity depends on your retirement goals, current financial position, and tolerance for risk.
Annuities can play a valuable role in your retirement planning—by understanding the different types of annuities and their features, you can make an informed decision about which annuity is right for your portfolio.
If the details feel overwhelming, let our experts help you navigate the options and choose an annuity that aligns with your retirement strategy.
Talk to an experienced agent at Benevize and get started today.