Annuities
Have a Steady Income Stream During Your Retirement Years
Back in the day, retirement planning was much simpler. Your parents and grandparents usually worked for the same company for their whole careers, and were paid a pension when they retired. The pension (benefits) continued to provide an income for them each year, no matter how long they lived.
However, pension plans are rare in today’s private sector. Retirement planning has shifted from being the employers’ responsibility to falling on the shoulders of employees. Needless to say, many workers are looking for ways to reproduce the annual stream of income that standard pensions gave them — without the concern of being cash-strapped in retirement. For these people, annuities are an excellent option.
What Are Annuities?
Annuities are a long-term investment vehicle that normally offers safety from loss. An annuity allows you to grow money, and when you retire, you’ll turn that money into a steady source of income that can last for life. Through a process called annuitization, your contributions are converted into recurring payments. The best part? You don’t have to worry about running out of money.
Why You Should Consider an Annuity
Saving for retirement is a must — but you also need to have a sizable nest egg in case you live longer than expected! Outliving your income is a real risk. You’ve worked hard, made sacrifices, and deserve good things, including:
- Traveling
- Pursuing a hobby
- Fulfilling your dreams
- Spending time with friends and family
Annuities can make all of this possible, so not only do you survive retirement, you thrive.
Get the right coverage at the right price.
Types of Annuities
With a variable annuity, you own investments inside the account. Because your principal is invested in the market, it can grow or shrink depending on the performance. There’s more risk involved here, but if the market does well, you have the potential for greater upside.
Fixed
A fixed annuity pays at a fixed rate. Your interest rate is set annually and will not change, despite whether the market drops or not. Fixed annuities are the safest type — results are fairly predictable and you’ll never lose any principal. But, growth will be relatively modest.
Fixed Indexed
There’s a special type of fixed annuity which offers the safety of a fixed annuity and the upside potential of a variable annuity. It’s called a fixed index annuity. It will credit interest based on what a market does, like a variable annuity, but it will form a ceiling and floor to downplay risk.
Consult a Trusted Professional.
Most insurance companies have to verify that the annuity you choose is suitable for your age, financial situation, AND retirement goals.
With that being said, not all annuities are created equal, it’s important to work with a professional that you trust. Time to start planning for the future now. Contact Oak Grove Insurance to see if an annuity is a good fit for you and your retirement plan.
