There are several ways you can ensure that you and your family have a happy, healthy, and financially secure retirement, including a 401-k, IRA, Social Security, and retirement annuities. With so many options, it can seem overwhelming. The good news is that Resolved Financial Solutions is here to guide you through any challenging decision making that needs to be done.
What is an Annuity?
A retirement annuity is an investment strategy that saves tax-deferred money that can replace a paycheck during retirement. Payments can be made to you in monthly, quarterly, or annual payments, or even a lump sum.
There are several options you have with annuities, including how much to invest, the size of your payments, how long the payment period is, and possibly most importantly, the type of annuity.
Types of Annuities
Fixed & Variable
- Fixed annuities allow you to have a guaranteed principal and minimum rate of interest.
- Variable annuities is where money is invested in a fund and the money paid to you depends on the performance of the investment.
Deferred & Immediate
- Deferred: You may not receive payments from a deferred annuity for years, or even decades, depending on the payment period.
- Immediate: You will receive a payment after the annuity is purchased. The timing of this payment depends on the payment period; one month, for example.
Lifetime & Fixed Period
- Lifetime annuities allow you to receive payments for the remaining for your life.
- Fixed period provides payments for a specific time period.
Qualified & Nonqualified
- Money from a qualified annuity can be invested and disbursed into an IRA or 401-k.
- Nonqualified annuities are purchased from another type of retirement plan.
Simple Premium & Flexible Premium
- Simple: You make a single payment.
- Flexible: You make a series of payments.
Before you purchase an annuity, it’s important to make sure it’s the right strategy for you. With Resolved Financial Solutions, we can help you determine if it’s the right choice, and if so, we can help you decide the best options for you.