BMA Gyaan- Annuity Investment Tips

Annuities are one of the most important saving tools for retirement. Annuities are safe, secure, flexible, tax-advantaged investment vehicles for those who want to live a comfortable life in retirement. Usually tied to retirement, annuities are investment contracts sold by life insurance companies based on a guarantee of fixed or variable payments for a specified period of time in the future. There are various types of annuities like fixed or variable, immediate or deferred etc. to choose from but it is crucial to opt for right annuity in order to get a safe future. In this article some useful tips have been described that will help you to make right investment in annuities. First of all collect all possible information about the different types of annuities. While there is not a lack of information on annuities, there certainly is a lack of good information. To get good info, you can get the help of annuity brokers who will provide enough information to aid you in the process of deciding whether a particular type of annuity is the right investment for you or not. Next, it is vital to decide about payment option. You can choose any settlement option such as annutization option, systematic withdrawal option etc whichever suits you best but once chosen, it cannot be changed. Annuitants should give full consideration to charges such as surrender charges or other fees, related to each and every type of annuity. Some times annuitants sacrifice the liquidity in order to receive the benefit of tax–deferred growth. This sacrifice takes the form of penalties both from the IRS for early withdrawals, usually beFor the age of 59½ and surrender charges or other fees from the insurance company for canceling the annuity contract or withdrawing funds within a certain number of years. So it is necessary to check tax consequences and potential penalties beFor choosing any type of the annuity. Choose certified and reputed insurance company to enter into annuity contract. To help you detect the strongest companies, there are several ratings agencies that rate insurance companies on the quality of their financial fitness, quality of investments and overall financial soundness. There are four leading agencies: Best, Standard and Poor’s, Moody's, and Fitch. Each agency has slightly different criteria and looking at different ratings for one company will give you a good overview of the company's financial strength.