Best Fixed Annuity - All The Different Options That Go Into Assessing The Right Annuity

By John C. Ryan

Those seeking the very best fixed annuity available needs to look towards one that serve your needs in the best manner. Not every individual that opts to purchase an annuity wishes to use the money immediately. In this particular case, an anuity can be considered a deferred annuity. Others that absorb the money immediately to use their annuity for immediate purposes as companies will vary the amount of interest they receive. This is done when they offer the product. In general, outcomes will vary based on whether one opts to take it immediately or defer the payment. That is why it is best to seek an annuity that is best for the situation.

Not only is the rate important when choosing your annuity insurance contract, but the length of time you receive that rate is another important factor to consider. Is the higher rate locked-in for a year or is it longer? Does the high rate include a bonus rate, which you'll only receive on deposit and then the rate drops dramatically? You need to investigate these things when you're looking for the best annuity.

Every annuity is accompanied by a basement guaranteed rate. This rate can be considered the lowest among the company will pay and this matters not what the rate conditions are. These rates may look quite low in good times and often that rate can be a great incentive to add to the annuity when the rate drops dramatically everywhere else.

When you need to find out if you can add the annuity later, you can do so later. This can occur when you seek a deferred annuity. There are companies that might allow one lump some and then you will be required to purchase another product later.

Annuities have other factors besides rate, which you need to look at when separating the best annuity for your particular situation. The length of the surrender period is often extremely important. If you want to use the funds later but don't want to take annuity payments, you need to find out how soon the money is accessible to you without a penalty.

Look to see if the annuity offers a fee free withdrawal privilege as various companies will offer a one time 10% withdrawal with no penalty and while other systems will be more liberal. When you find an annuity that comes with a high interest rate, you will discover they often come with longer surrender periods. The longer period is usually not helpful for those people nearing retirement. The exception to this would be a helpful free withdrawal that fits properly into their schedule. There are liberal ones that will allow 10% per year are decent but cumulative withdrawals. That means you will be allowed to remove 10%. Those that do not use it will discover it adds to the next year which is helpful.

Ask for a quote if you're taking payments from the annuity. If you take a lifetime of payments that you can't outlive, you need to remember that if you pass away, your payments stop. That means that if you put $100,000 into an annuity and took only one payment then passed away, the insurance company keeps the rest. One way to avoid this is to take a lower payment that guarantees a specific number of years of payments, a return of principal or adds a second person as an annuitant.

The best annuity for one person's situation does not necessarily yield the best one for another person. That is why it is best to get several quotes while seeking the advice of a helpful annuity specialist. - 31884

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John C. Ryan provides the latest info on anuity insurance. For more information on how to pick the best fixed annuity for you.

Selling Your Annuity Payments

By Chet Dowser

Have you got an annuity payment that arrives for deposit into your bank account on a monthly basis? If this is so do you realize you can sell annuity payments that you receive monthly for an one pile sum? Would it not be nice to have all your money at one point rather than getting a little of the larger pot on a once per month basis?

When you sell your allowance payments you'll be giving up that monthly earnings. However, in several cases, folk find better uses for the cash if they'd it in an one-off lump sum payment. For instance, if you inherited a pension payment, then if you would sell pension payments for the one-off sum amount then you would be ready to put on a down payment on a home or pay for your youngster's college education fees. There are many other things which the cash could be used for, so I you want to find out how to sell pension payments, then continue to read.

The Facts

Here's a list of steps that you may use as a guide to help you find the simplest way to sell pension payments :

Contact the insurance company first and see whether there's a way that you can cash in on the annuity for its worth instead of really selling it. You could possibly finish up with more of the money this way, instead of having to pay the fees that happen when you sell allowance payments. You may quite likely have to pay some type of a penalty for cashing it in. Bear in mind that each annuity can come with different terms, so you will not know the terms if you do not call and ask.

Contact a company, on what's called the secondary market, that will buy the annuity off of you. Make sure that you ask them for a free quote. You'll find a selection of firms who offer this service when scouring the Internet or you could just ask your insurance corporation for a suggestion. Whatever you do, check out the corporation's reviews from other sellers to see what type of reputation that they have. And, don't settle for the first quote ; make sure that you do some comparison shopping in order to find the best deal.

Compare the quotes that you receive from both the insurance corporation and the companies on the secondary market. The cash is yours and you don't want to have to give part of it to the company. By comparing quotes that you received to sell allowance payments, you'll be better in a position to compare which company will offer you the best rates/penalty fees.
So, if you would like to get your allowance payments as an one lump sum rather than a once per month payment, then use this guide to help with the method of how to sell annuity payments. In the end, you may be glad that you got several quotes and compared the offers. - 31884

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Go to Sell Annuity Payments to get free information on this product. This website will give you all of the information you need on Sell Annuity Payments along with a lot of other free information. Don't miss out on this new website if you are looking for Sell Annuity Payments.

Things To Consider When Choosing the Best Fixed Annuities

By John C. Ryan

A fixed annuity may sound confusing at first but if you understand how a CD works at a bank, you have the basic knowledge for fixed annuities. Annuities have other features besides a rate guarantee that make it an interesting choice over a CD. There's a little more information to look at to see if this type of investment vehicle is right for you.

There are two different ways to used fixed annuities. The first is an immediate annuity. In this case, you take smaller equal payments over a set period. The time may be your lifetime, the lifetime of your spouse and yourself, a specific number of years or you can request a specific payment amount and let the company tell you how many payments it lasts. A deferred annuity does just as the name implies, defers the payment to a later date.

Annuities are for retirement money and receive tax-deferred growth. As with any retirement vehicle from an IRA to a pension plan, if you take the money out of a fixed annuity before age 59 in most cases, you pay a penalty. In this case, it's 10 percent of the growth. There are exceptions to this rule. Lifetime payments or payments that last to the age of 59 or for at least 5 years if you're between the ages of 54 to 59 . You or your family also doesn't have to pay IRS penalties if the owner/annuitant dies or becomes disabled.

Penalties for early removal of money don't stop with the IRS, insurance companies impose them too. Just like a CD, a fixed annuity has an early withdrawal penalty. It often ranges between four and seven percent. This normally gets smaller the longer you wait to take money and eventually disappears on most contracts. Some contracts, particularly those that pay a high rate, always have a surrender fee unless you annuitize. Occasionally they impose the same fee on beneficiaries. If you plan to take payments, it's not a problem.

There are exceptions to the surrender charge. Many contracts offer the ability to remove funds of as much as ten percent without penalty. This amount may be available each year or once for the life of the contract. Almost every annuity allows you to take the interest penalty free each year and some people use the annuities that way, just as they'd use a CD.

Even though you may allow your CD to roll over, you still have to pay taxes on any interest you earned. This isn't true for an annuity. As long as you don't remove the money from the contract, you don't have to pay taxes on the interest. Even if you want to take some of the principal and leave the interest in the contract, the IRS looks differently at your distribution. Annuity tax laws use LIFO rules. That means, last in, first out. Interest is always the last thing into the contract so the IRS considers the initial money you take as interest until you reach the amount you originally invested.

Immediate annuities have different tax rules. If you use the fixed annuity as a deferred annuity and then annuitize it later, it follows these rules also. Part of the payment each year is principal and part of it is interest, according to the IRS regulations.

To calculate the amount you pay in taxes each year you use an exclusion ratio. The exclusion ration is how much you exclude from that contract's income. To find it, you need to know three things; your life expectancy, your payment and the amount you invested. You simply multiply your payment times the number of years for life expectancy. If you receive $800 a month and have a life expectancy of 22 years, you'll get approximately $211,200 over the lifetime of payments if you collect in full. If your initial investment was $100,000, you divide that number by 211,200 and get an exclusion rate of 47 percent. In this case, you'd only pay taxes on 53 percent of your annual income from the fixed annuity.

People often select fixed annuities because they either love the idea that they'll never outlive their money, find it a useful tax-planning tool or simply like the high rate and ease of use. Many financial planners suggest that individuals divide their funds into several different vehicles for higher returns and a safer investment strategy. Often seniors fin that a fixed annuity is a great way of establishing a base income in addition to social security or their pension. They know they'll never run out of money, have a higher payment than an interest payment and can allow other funds to grow at higher rates of return. - 31884

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John C. Ryan writes about annuity insurance, and advises how to find the best annuity given your particular situation. Want to learn more?? Come see us, to learn more about fixed annuities .