When it comes to retirement planning, there are many different options you can take a look at and consider as your plan for retirement. However, once you’ve begun researching for the right fit, it can get difficult to decipher all the differences, as well as weigh the pro’s and con’s of each. Our goal at Income For Life is to make planning for retirement an easy process. From deciding what plan will work best for you, to keeping track of your investments, we aim to set you up for retirement with ease. With all of that said, we’re going to lay out all the differences in one type of retirement plan known as annuities. We’ll break down the basics of annuities, as well as explain the different types and their different ways of functioning.
- What is an annuity? – It’s a fixed sum of money that someone will be paid each year for the rest of their life. It’s a form of insurance or investment that entitles the investor to annual sums of that money.
- How does it work? – Your insurance company will allow you to put aside money that will increase each year, and you won’t have to pay taxes on it. You investment gains money along the way.
- Are there different types? – Yes there are multiple actually. You can get fixed annuity, or even a variable annuity. There are also hybrid forms as well.
If you’re considering planning for retirement, we recommend thinking over the benefits of annuities, and if you should have any questions, contact a certified financial planner at Income For Life. Stay tuned to our next blog for more information on annuities.