Annuity Payment Buyer – Making Annuity Payments Work For Retirement

Today’s economy is causing many people to sell their annuities to an annuity payment buyer.  However, maybe they should look at the bigger picture before they consider selling that annuity.  The decision is ultimately the annuity holders, but they need to be informed of their choice and make it wisely.

With today’s economy in the state that it is in, many people are not relying on building their retirements on their own but are turning to annuity payments to secure their retirement benefits.  People do not want to worry about their golden year retirements so they are doing all that they can to secure that position of stableness and peace.

In recent months people have been changing the way that they purchase annuities.   Most have been purchasing annuities that are known as immediate annuities over the variable annuities.  The reason for the change is that the immediate annuity makes steady gains on the investment as opposed to the variable annuity which fluctuates. 

People want to know that their investments are going to give them a guaranteed return when they need them.  They are investing mainly in insurance payments that will convert the lump sum payment into lifelong payments so that their retirement is a little easier for them to face.

Are financial advisers happy about this trend?  Not really.  The financial advisers feel that annuities do not bring back to the investor enough outsized gain.  They also feel that once the investor hands over their money to the insurer that the investor cannot get it back or if they do so it has to be at a loss to the person who did the investing.  Financial advisers also feel that variable annuities are too complex and filled with hidden fees and agendas.

People are finding that annuities give them a definite sense of security over their 401K investments.  Since so many people are fighting losses in their investments these days, they have found a definite appeal in the annuities.  With annuity payments coming in on a steady basis to supplement their social security in their golden years they do not have to worry about their money running out. 

Are there any potential problems that people should know about before investing in an annuity?  There are potential problems with just about anything.  Many people have a general idea of what an annuity is, but have no idea what kinds of questions that they will need to answer when they are thinking of investing in an annuity.  Do you know how much money you want to invest?  Do you want an immediate or gradual return on the money you invest?  How do you want to invest the money that is left over?

Immediate annuities allow you to make a payment convert into a monthly, quarterly, or annual payment for life.  What a way to set up for your retirement.  You should know that most annuities are fixed which means that you will need to set the payment amount when you set up the annuity.

The extra income that you receive will come at a cost.  Most of the time, you will have to forfeit the principle to the insurer.  You will receive payments based upon the interest and a portion of the principal based upon your expected life span.  When does the payment stop?  The payment stops immediately when you die no matter if you have gotten back your initial investment or not.

Willing to settle for a lower income from your annuity?  If you are, you can purchase over riders that will help you deal with some issues that you may have with annuities.  No one wants to leave their heirs empty handed when they pass away.  You can purchase a rider in which your heirs will continue to receive your annuity for a specified amount of months after your passing.  You can also specify a rider also that at a lesser return on your monthly check, you can have an adjustment for inflation added to your annuity.

Annuity payments can be critical to your security of a set of golden years that are stress free from financial worries.  You just have to do your research and plan carefully.  With today’s economy everyone is having to plan and research thoroughly every single thing that they do.  Purchasing an annuity should also be the same.  Secure your future with knowledge and empower yourself with that knowledge.