Annuities for Dummies
Annuities for dummies:
At first blush, you’d like to think annuities are a simple deal- Give money to an insurance company, get income in return….. But anything that has a ‘for dummies’ book written about it is far from simple! We’ll try and consolidate our own information on annuities here, but unlike ‘Annuities for Dummies’ we won’t insult you intelligence by starting off calling you a Dummy!
In reality, annuities are one of the most confusing financial products available in the market. How to chose? Well, first you need to define just what you need, what your income needs are, and what asset you have to invest. Then, when you know your retirement timeline and needs, you can think about the kids of annuities.
There are several kinds of annuities- fixed annuities, variable annuities, immediate annuities, and indexed annuities are the most common varieties. Then within each of these main types, there are riders, options and clauses you can add to tailor to your needs.
Once you know your needs and know the general type of annuity that might suit, it’s appropriate to investigate a few specific annuities with the help of a qualified advisor- you can find one by filling out the form to the right.
With your advisor, you should focus on the combination of Safety, Profitability, and Flexibility that is right for you. A good advisor will make you aware of products that meet your criteria- a great advisor will advise you which ones NOT to buy as well!
It would be a disservice to offer a definitive ‘annuities for dummies’ guide showing the single best product for everyone, that would be a true disservice to our readers. And anyone offering you such a ‘magic bullet’ is fooling themselves and you.
There are plenty of annuities to suit individual needs. It’s imperative to focus first on defining what YOU need. While considering your needs, you can learn about annuities in general. Then, when you know just what you want and how to tell a good annuity from a bad one, it is appropriate to select a particular annuity contract. Too often, investors are presented with a product first, and most likely from an advisor who didn’t even read ‘annuities for dummies’ or take the time to understand the client’s needs.