What Is An Annuity? Annuities Explained

 By: Robert W Pearce
An annuity is a contract whereby for a fee you will be guaranteed an income for the entirety of your retired life. Annuities give you (plus your partner) a sense of security for you retired life. The income that you could possibly receive from an annuity can have an effect for the rest of your life so be sure you seek professional advice before entering into a contract.

How could you gain from an annuity?

- It can give you (as well as your partner or spouse) security in order to let you live the retirement you always dreamed of

- The level of any annuities you take may be selected by yourself (monthly, quarterly)

- Spousal benefits are one option that'll be available to you

Do you know the different types of annuities?

The main three catergories of annuity are:

- Fixed Annuities
- Variable Annuities
- Indexed Annuities

Fixed Annuities

The low risk option that locks in a certain return for a given time. A fixed annuity is the simplest kind of annuity and is well suited for somebody that wants a specific, fixed amount of income in retirement.

Variable Annuities

With a variable annuity the premiums are paid into a portfolio of investments. Obviously this kind of annuity carries more risk and the payouts depend on the quality of the investments and market performance. Whilst the risk value is higher with these kinds of annuities it also means that the returns may be greater. They are often picked by younger investors or those who like a little risk within their lives!

Indexed Annuities

Indexed annuities use a rate tied to a financial market index.

The different types of annuities often mean that it may be difficult for individuals to determine if:

- An annuity is the best choice
- Which annuity to choose

A financial advisor can help you look at your personal circumstances and help you to decide the type of annuities are best suited for your requirements. You have to be satisfied that you've taken into consideration each of the pros and cons so any annuity you decide on is the the one that is right for you. After you have bought an annuity there is no going back.

For this reason it is crucial that you choose your annuities carefully, if you do, there's no reason why you can't fully enjoy your retirement without the money worries.
Artice Source: http://www.articlesphere.com

Related Articles in Annuities

People interested in the above article are also interested in the related articles listed below:

Annuities are best for old people and people desiring to opt for it. However, many agents fake the annuity policy and claim unnecessary and illegal money from the insurers. This is normally done without taking into account the status of medical fitness and the health over the ageing persons. For younger generation the annuity proposal is the best but for older people opting for it without any medical certification lead to trouble ahead. It is best for senior citizens not to opt for annuities as it is not at all beneficial to them.
Are you thinking yourself... "How should I get the best deal on annuity rates?" If the answer is yes then you might be attracted to the following guidance on annuities. Taking just a short while to understand how the pension annuity system works could be worth thousands of pounds in the future. Straight from the off you should know that it is key that you shop between providers for the best annuity rates. Not completing this process will mean that you cannot be sure of the best rates. This could mean you miss out on a higher retirement income.
The twilight zone of your life is now secure, financially. Pick up your choice of annuity after adequate deliberation and you can actually start dreaming about how your retired life will be. Selecting the right annuity rates will make life a long, unending vacation after retirement. You can ride into the sunset in style. Annuities are a way to transform your pension fund into regular income that shall last you a lifetime. Though this post-retirement income is taxable, you can play smart and chose the right kind of annuity that shall suit you the best.

More in Annuities

Excellent, Larry. Thank you for taking the new article directory technology and making it work to the max. I encourage everyone to keep contributing and contributing regularly. I can attest to the fact that this site is already a strong directory in a field of many. Kudos to Larry!

Matthew C. Keegan
The Article Writer


I find it a delight to use both as an author and a publisher. It is full of nice little surprises that make the whole process of writing, reading and publishing articles a complete delight. This is one that comes out tops and beats the rest hands down.

Eric Garner
Managing Director


I did a Google search and came across your site. It was exactly what I was looking for and was elated to find such a broad range of articles. As I am launching a free magazine in a small town in Florida, I wanted to be as resourceful as possible while still being able to provide some content that is interesting and well written. Your site has all the variables in the mix. Excellent Site hitting all the notes in the scale sort of speak.

Mo Montana
Florida, USA

Article Topics

Copyright © 2005 - by Larry Lim, Singapore - Article Search Engine Directory at ArticleSphere.com™
All Rights Reserved Worldwide. All Trademarks and Servicemarks are the property of the respective owners.
ArabicBulgarianCatalanChinese (Simplified)Chinese (Traditional)CzechDanishDutchEnglishEstonianFinnishFrenchGermanGreekHaitian CreoleHebrewHindiHungarianIndonesianItalianJapaneseKoreanLatvianLithuanianNorwegianPersianPolishPortugueseRomanianRussianSlovakSlovenianSpanishSwedishThaiTurkishUkranianVietnamese