What is an Index Annuity? Get The Real Facts Here

Tax-Free Retirement: 1035 Exchange Explained

1035 exchange annuity can be very beneficial when it comes to planning your retirement, especially, if you are searching for a way to generate a guaranteed stream of income. While annuities can play a vital role in executing a well-rounded estate plan, if at some point you decide you need to switch one annuity for another, you can do so without accruing any tax utilizing an annuity income tax treatment known as the 1035 exchange. Using a 1035 exchange, you’ll be able to customize your benefits on your terms, to get you closer to your goals of a tax-free retirement. 1035 Exchange Defined: A 1035 exchange is a legal way to exchange one insurance policy, annuity, endowment or long-term care product of like kind without triggering

What is the Difference Between Fixed Index Annuities and Fixed Annuities

Annuities are contracts between an individual and a financial service provider or insurance company. The way it works is you invest money in an insurance product or policy type and in return you receive a return, sometimes fixed and sometimes dependent on “the market”. You can also receive regular income over an agreed-upon period. Annuity Rates Are All Different The percentage by which annuities grow each year is the “annuity rate.” These rates can fluctuate based on the contract (the purchase). This fluctuation can be mitigated by either limiting the period of time in which you are paid (called the term) or by the performance of the stock market index you are tied to. These two methods are what make up the two most common types

Should I Allocate Retirement Savings Into An Annuity?

Allocate Retirement Savings Want to augment your retirement savings with a steady stream of income? You might want to consider devoting a portion of your savings into an annuity. An annuity is a contract between you and an insurance company. You can make either a lump-sum payment or a series of payments. In return, you receive regular disbursements either within a month or at some time in the future. There are different types of annuities, but all fall under the two major categories: Deferred and Immediate. With an Immediate Annuity, you can start receiving your payments within 30 days after your initial investment. A Deferred Annuity is different, however. Your money is invested for a period of time until you are ready to start receiving disbursements. Most

Should I Purchase an Annuity for Regular Income?

Annuities for Regular Income? Do you sometimes have trouble with money management? Do you often worry that your regular income isn’t enough to support yourself? If so, an annuity might help you out. If you aren’t great with money, an annuity seems very confusing. There are a lot of misconceptions or simply lapses in knowledge that can make understanding annuities very difficult. Because if this, it can be very hard to figure out whether or not you should purchase an annuity, and whether something like that is the right step for you to take in your financial plan. Have you had these doubts? If so, you aren’t alone. It’s been found that while 84% of retirees want annuities, only 14% actually buy them. A lot

Check or Bet: What To Do With An Annuity

What To Do With An Annuity? The fastest growing segment of the population are folks 60 and older. How many of these Baby Boomers have set aside enough money to use for the rest of their lives? A third of people over 65 have less than $30,000 in savings when entering retirement. Is an annuity a good investment option for you? How do you decide to check or bet when it comes to buying annuities? Here are the top reasons to bet on and check out annuities. Top Reasons Why You Should Check Or Bet On An Annuity You’ve Maxed Out Other Retirement Savings Options – Bet Contributing to a 401(k) and IRA deferrals are a great idea until you reach your max. Say you’re

Credit Rating Agencies: Which One Should I Trust?

When you’re looking through different annuity selections with your financial advisor or consultant, knowing which insurance offer to trust makes a big difference. Credit rating agencies rate insurance companies with a grade or percentage. This score assigned to each independent insurance agency indicates that company’s ability to pay policyholders’ claims. The Big Four: A.M. Best, Comdex, Moody’s, and Standard & Poor’s Financial rating services such as A.M. Best, Comdex, Moody’s, and Standard & Poor’s rank insurance companies based on their financial strength and stability. Before you invest in an annuity, check that annuity’s insurance provider’s ranking. These financial rating agencies are independent and they all have their own rating scale based on their own standards. Which rating service should you use?

Understanding Annuities for My Financial Future

Understanding Annuities There has never been a better time to invest in your financial future. There is a wide variety of strategies to generate income, protect your assets, and secure your retirement income stream. The cost of living is rising and life expectancy is simultaneously increasing for many adults. You may be wondering how to best create an investment strategy in order to not run out of money during retirement. People want to make the most of their money but without the chance of losing it all. That’s where annuity products come in. What Is An Annuity? An annuity is a contractual financial product sold by insurance companies. Annuities do two things: To help people limit their risk and give them a better return than a

Who Can You Trust With Your Money: FDIC Insured Banks Vs. Annuities

FDIC Vs. Insurance Providers: Are You Protected? The federal government requires banks to keep 10% of your CD in reserves. 10 cents of every dollar you’ve deposited is in your banks reserves. This goes for money market accounts as well as any money that you put in your bank account. On the other hand, state insurance commissioners regulate annuities. This creates a major difference because insurance companies have to keep 100% of your annuity. That means 1 dollar for every dollar of your investment. According to Forbes, if you wanted to take your annuity out of the insurance company and liquidate that asset, you would walk away with the current value of the annuity plus the current value of future obligations on those contracts. Breaking It

7 Questions to Ask Before Buying an Annuity

What to Ask Before You Buy an Annuity Many people reaching retirement are looking for ways to improve their financial security. It is unsurprising that many people are considering buying an annuity. If chosen well, an annuity can prevent a person from outliving their finances. What’s more, it can provide increased protection against a volatile stock market. As annuity will convert current wealth into a steady income, it is vital to make an informed decision. Also, as life insurance and annuity scams are on the rise, an investor should not rush into a plan. So, it is important to ask yourself the following seven questions when buying an annuity. 1. What is the Annuity Process? An annuity is a big financial commitment, so you must have

Why Invest in Annuities? Because The Exclusion Ratios Means Tax-Exempt ROI

Why Invest in Annuities? Exclusion ratios are tax-exempt portions of your annuity return. For example, each annuity payment you receive can be split into two distinct parts. The annuity investment capital is one portion. The other portion is an additional amount that is taxed at the current income rate. This portion is interest that you’ve earned. Consequently, it’s taxed as regular income would be. The capital portion of the return is not taxed. The return on capital, or the additional balance after the principal capital is subtracted, is taxed. This is because it’s considered part of the annuitant’s gross income. What Is The Exclusion Ratio? The exclusion ratio is a calculable ratio used to identify the portion payout that is excluded from taxable income. The