A Secretive Policy to Grow Rich after Retirement

Are you on verge of retirement? Or, you are planning to retire early? Have you ever realized that if you keep on withdrawing from 5 – 7 percent of your savings every month, then you may fell short of funds even before your retirement? Well, this concern may have compelled to raise your eyebrows, but remember to become wealthy at the time of your retirement, what matters the most is how wisely you have optimized your investment portfolio and to what extent benefits you have estimated out of your investments.

Are you worried of outliving your income? Relax, that won’t happen unless you opt for any investment scheme haphazardly and focusing only on short term gains! It’s about the financial security of your old age, so investment should be absolutely worthwhile. Have you ever thought of investing in an annuity?

Grow Rich after Retirement

Indeed, Annuity can truly be a smart investment plan, provided you are purchasing the annuity from an insurance company who has proven track record of many satisfied clients. It’s always wise to approach an annuity providing company itself rather than opting for a scheme through an agent.

You can invest in accordance with your financial plan and current savings. If you have saved quite a huge amount over a quite a long time, it’s the time to earn some real value out of it. So, you can invest lump sum and start receiving returns almost immediately! Or, if you want to invest to over a certain period of time and opt for a fixed scale of return. Well, let’s delve a bit deeper into the types of annuity and you yourself can choose the right one for you:

Variable Annuity:

It is a type of annuity contract in which you choose the investment scheme and earn based on the performance of your investment. Not satisfactory? Well, before planning to invest, be sure that the company is providing you the prospectus with clarified scenario of risk factors and potential growth opportunities of the scheme. If you yourself find it to be bit undecipherable, then please consult some of your known investment consultants or discuss with your colleagues who have already been benefited from that scheme. Well, know let’s look at the pros and cons of variable annuity:

Pros: One of the most advantageous aspects of variable annuity over mutual funds is the guaranteed death benefit.  Irrespective of the performance of subaccounts, death benefit ensures that annuity owners’ beneficiaries are no less than the initial investment. Some variable annuity offers minimum rate guarantee return even if the subaccount suffers loss for a year.

Cons: Before deciding to invest in a variable annuity, think of it as a long term investment. Opt for this scheme, when your retirement year is still ample time away.  It has limitation of withdrawal; majority of the companies offers one time withdrawal in every year. There is a surrender period of contract, which may approximately last for 15 years. If you decide to withdraw some amount within that period, then surrender charge is applicable. Variable annuities are tax deferred investments, so withdrawals are taxed as ordinary income (earnings of a salaried person). Any amount of withdrawal prior to the age of 59 is subjected to 10% tax penalty.

Immediate Annuity:

An annuity scheme which begins with a bulk investment and earning starts almost immediately. This is perhaps most suitable for retired individuals who are afraid of outliving their savings! This scheme of annuity ensures a guaranteed return within almost no time of investment. Well, that seems to be an advantageous aspect, right? Okay, and then let’s look at the pros and cons of this annuity scheme:

Pros: Your investment gets converted into a guaranteed streamline of income and you really don’t have to wait! If you have enough of savings with matured policies along with provident fund and gratuity, then invest a smart proportion of it into this scheme and never ever you have to worry about outliving your savings.

Cons: This investment scheme is irrevocable, once you have invested. So, if an annuitant needs a lump sum amount to deal with an emergency, he/she may run short of fund.

Fixed Annuity:

This is the best investment scheme for those who are just about to retire or have already retired. In lieu of a bulk capital, the insurance companies offer a guaranteed fixed rate of interest guarantying the principal investment.

Let’s focus on the key features of fixed annuity:

  • Guaranteed Minimum Rates: No sooner the initial guarantee period expires, the rate is calculated on a specific formula (depends on the company) or the amount which is earned in the insurer’s account.
  • Tax Deferred Growth: Tax deferred accumulation of earnings.
  • Withdrawal: 1 withdrawal every year up to 10 percent of total account value.
  • Guaranteed Income: Fixed annuities can be converted into immediate annuity at anytime to generate a guaranteed income for a specified time span or lifetime.
  • Safety of Principal: The capital invested is guaranteed by the life insurance company.

Fixed Indexed:

This scheme offers returns on investment based on specified equity based index. It also provides a specified minimum, which the value mentioned in the contract will not fall below, irrespective of index performance. It’s not a stock market investment and does not participate in any stock or equity investment.

Do you need an annuity? Ask yourself few questions

  • What’s the crisis that’s troubling you and what amount you need to breathe easy
  • Do any of the annuity actually provides a solution to what you need
  • Is there any alternative to annuity
  • Consider the capital differences, time span , and what-if scenarios seriously

Retirement is worth of cherishing after tedious years of hustle and bustle, woes and worries! Take the right stride at right time and be ensured of a rejuvenating retired life.

How to Jump Gracefully Over the Five Main Hurdles to Selling Your Annuities

To earn additional income and grow businesses, many licensed financial advisors and insurance agents turn to selling annuities. Despite many products carrying excellent features and benefits, selling them to consumers can be difficult. In fact, here are the five main obstacles you will encounter:

1. Competition 

As you begin to research how to sell your annuity payments, competition from insurance companies and agents is a major obstacle. With so many individuals and businesses competing for the same investors, it’s difficult to stand out. In fact, according to the Bureau of Labor Statics, over 320,000 agents are licensed to sell annuities and insurance. 

2. Misconceptions 

Annuities involve investment strategies and financial planning that may not be ideal for everyone. In addition, annuities often receive negative press that exaggerates the cons and overlook the pros. Unfortunately, many reviews also do not clearly explain the differences between various types of annuities. With so many misconceptions and general confusion, an agent may find it difficult to overcome preconceived notions. 

3. Fear 

Stemming from misconceptions, many consumers are hesitant to invest in annuities even despite the number of benefits a contract offers. With so many people feeling comfortable with their existing investment planning and strategies, it can be difficult to convince them to make changes. Fortunately, agents can show consumers how annuities can provide control and steady income for years to come. 

4. Internal Fees

The internal fees for many products is considerably higher than fees for alternative investments. Due to the higher fees, many people do not want to invest retirement money into an annuity. Unfortunately, an agent will have to work hard to rationalize and justify the investment. Fortunately, the task can be made easier by pointing out specific advantages offered by annuities that are not available through other retirement options.

Another type of fee that consumers are wary of is the surrender charge. The surrender charge is a fee given to the insurance carrier if the policy is canceled before a certain amount of time has elapsed. The surrender charge can claim anywhere from 4% to 12% of the owner’s money, so many consumers object to such a fee. In some cases, clients may be more inclined to invest their money in stocks than annuities. However, agents can help reassure clients by telling them that it is ultimately better to gain 50% and experience no losses than gain 100% and potentially lose 100%.

5. Market Volatility

Although many annuity products offer features that guarantee performance and protect balances against losses, many people simply don’t trust the market. To help people feel more comfortable about their growth potential, agents may want to focus on fixed or indexed annuities that provide safety and security.

Selling annuities can be a very rewarding way of earning extra income or expanding your business. By overcoming the five main hurdles and showing consumes how annuities can work for them, you can achieve success with the venture.

Melissa Rudd is a part-time accountant and mom of three. When she has some free time, she likes to unwind by posting on various blog sites. 

What Exactly is A Fixed Term Annuity?

A fixed term annuity is a type of pension product that offers an alternative to the usual method of obtaining an income during your retirement. It’s actually a more flexible option, which is ideal for those people who are looking to keep their options open, because they think that their personal circumstances could change further into their retirement. If you think you might need more money as your health deteriorates, you could be stuck with a fixed income for the rest of your life with other annuities.

The concept is quite simple; you invest a sum from your pension scheme, and then the provider pays you a guaranteed income for a set amount of time, which is generally five or more years. It’s important to note that the government does impose limits on the amount that a pension scheme can pay out per month, though you are generally able to choose what you’d like to be paid within those limits. There may also be benefits to take, should you not live out the full term. If you do reach the end of the agreement, you are eligible to receive a lump sum. Many people choose to reinvest this in a future plan.

It is important to be aware that not all plans are the same. For example, some policies offer the chance for you to convert to an enhanced annuity if your health deteriorates during the term of the annuity, but this is not always the case. If you didn’t have the benefit, you’d have to wait until the scheme had ended to choose a new income product. For this reason, you should always seek advice before buying any product, and you should make sure that you fully understand all of the details.

To conclude, fixed term annuities are a product that will be ideal fro some people, but are not suitable for others. If you want to ensure that your options are open, and don’t want to have to worry about investment performance, then a fixed term annuity could be a very good decision. If however, you want a guaranteed income for the rest of your life, and would prefer not to have to think about buying a pension product in the future, then you may want to look into traditional annuities. You can visit www.nononsenseannuities.co.uk for more information on different types of annuities.

Make Investments in Annuity for a Safe Future

If you are employed, then this is the right time to invest your hard earned Investing in Annuity for a Safe Futuremoney in a safe and secured form of investment known as annuity. If you are wondering what annuity is all about, let me explain that an annuity is a contract between the investor and the insurance company that is offering such an investment. Keep in mind that although the annuity is offered by the insurance company, it is no way similar to the insurance coverage.

Annuities are not the sole property of the insurance companies; they can also be marketed and sold by banks, brokerage firms, savings, and loan institutions, financial planners, as well as the investment advisers. When you invest in an annuity, there are certain assurances that are you are given by the insurance company. These factors and assurances depend upon the insurance company that is issuing the contract with you and also on the type of annuity that you have chosen.

There are three basic ways to list an annuity: a) the way the money is invested, whether at a fixed rate or at a variable rate, b) when do you want to get the returns, whether immediately or in a deferred manner, and c) whether you can also add extra money to the investment, or in other words, whether the annuity has a single premium or has a flexible premium method.

How would you want your money to be invested?

Well, the fixed rate annuity has much similarity with that of a bank certificate of deposit. You are guaranteed a return for certain period of time. Usually the longer is the tenure; the greater is the interest rate.

In case of a variable annuity, it is again somewhat similar to the mutual funds. There are many investment portfolios that are offered to you and you can make your choice from them. These investment portfolios are also known as sub-accounts. The choices range from money market also known as ultraconservative to the aggressive ones which are known as the Pacific Basin Stocks. You can decide where you want to allocate your money and also make changes as per your convenience.

Regarding the income, immediate annuity is for those people who wish to start receiving returns as soon as the investment is made. In case of deferred annuity, the annuity amount grows and compounds for an indefinite period. It is imperative to say that the deferred annuity is more popular with the people all over the world. in case of deferred annuity, you can decide after some time when you want to start withdrawing your money.

Also remember that all variable annuities offer flexible premium as a choice and all fixed annuities are single premium. There are although no disadvantages in having more than one single premium annuity.

Know More About Annuities and Annuity Rate

You may have heard a term called annuity rate if you have participated in discussions related to finance. This word or term is generally seen in finance stream. The word annuity is referred to any upfront payment you give to an agency generally insurance agency and they give you a fixed payment every month or year. The terms of payment define the annuity rate and the time span over which you get the payment. The time can be years or months. Annuity is generally considered over the value of money with time. More specifically it is the future value of your investment.There are various examples of annuities like monthly payment to insurance agencies, deposits to an existing savings account of a particular bank etc. There are different types of annuities like deferred annuity, immediate annuity, fixed annuity, variable annuity and index annuity all of which have their individual meanings and rates.
Annuity rate is the rate of return on the annuities or the investments you have made. The annuity rate depends on mainly factors like time, the frequency of payments and the total investment made. It is the payment which is made by agencies as fixed in the agreement with the individual annuitants. The rates also vary on life expectancy and gilt yields. Sometimes it depends on the market conditions and the policies set by the then government. The type of annuities also creates a difference in the rate of annuity. When the annuities are in a fixed terms as per the agreement then the rate of return is also fixed and valued and you can almost guarantee an assured return. In case of variable terms the return is not assured as the annuity rate generally depends on the market conditions and subsequently the interest rate which generally depends on the former. You should always consult few people and have a thorough search over the web to know in detail before investment.