Are Annuities a Good Investment for Retirement Planning?
June 25, 2024 | Kari Mellone
Retirement planning should be an essential aspect of each individual’s life. The timing and tactics are often quite varied. Still, it is something that every person needs to make an effort to accomplish throughout their working years to ensure that they can live a happy and comfortable life in their seniorhood. Whether you are just starting to think of investment options for the future with many years ahead of you or nearing retirement and considering additional income stream options, understanding what an annuity is and how it can help your financial planning can be beneficial.
What is an Annuity?
An annuity is a contractual agreement between an individual and an insurance company. It can only be provided by a life insurance company and sold by a licensed life agent.
Why Timing is Everything When Buying an Annuity
Are Annuities Ideal for Retirement Planning?
Annuities can be an ideal vehicle for those planning for retirement and looking to secure a reliable financial stream for the future. It’s important to note that there are several different types of annuities, and the characteristics can vary significantly from one type to the next. Annuities are not for everyone but can be suitable for much of the population because of their many benefits.
Benefits of annuities can include:
- Investment safety from market risk
- No upfront sales charges
- Potential tax advantages
- Ability to bypass probate if beneficiaries named
- No medical underwriting requirements
- Strong compounding interest rates
- Various withdrawal options for added flexibility
Depending on the type of annuity, there can be some drawbacks, such as fees or potential surrender charges. Additionally, some individuals may find annuities complex or confusing, particularly when it comes to variable annuities. This is why it is important to work with an experienced and trusted life insurance agent who can help you navigate the various types of annuity plans and determine which is ideal for you based on your financial goals.
Want to Learn More?
At Twin City Underwriters, we know that individualized attention to a client’s personal situation and needs are especially important, which is why we take the time to understand you and your financial goals. Contact us to schedule an appointment with one of our experienced insurance agents.
Are you ready to have a meaningful discussion about your financial needs? Call or email TCU today to set up a free, no-obligation appointment with one of our dedicated agents.
Call Twin City Underwriters to learn more: 651-488-0172 or 800-507-6778.
