Ernest & Young Tax Guide defined annuity as, “a contract you invest in and receive a promise from the insurance company to pay a series of payments for a fixed number of years or over a lifetime.”

Think wisely, whether an annuity accommodates your retirement needs or not. By investing funds in an annuity plan, an annuitant can reap the benefits in old ages.

Annuity is an amount of money given to insurance company in order to get income for certain period or throughout the life. Certain period entails that the beneficiary will be paid for the remaining years, if the annuitant pass away within the definite period.

Annuities are reliable income sources after retirement. Annuitants can receive income monthly, quarterly, semiannually or annually. As there are a variety of annuity products available in the market, they can be categorized into three classes: single premium immediate payment annuities, deferred annuities and variable annuities. Both the deferred and variable annuity plans are available on a single premium or flexible premium basis.

In case of deferred annuity, payments will be started in future by the insurance company, where your money is invested.
Joint life annuity pays income until the death of the first annuity holder. Such annuity program is not suitable for a husband and wife because the death of first spouse discontinues the income payments.
On the other hand, joint life and survivor annuity pays up until the death of the second annuitant. In case, the first annuitant dies, the second normally gets 50% of the total payment.
In single premium annuity program, the insurance company assures to pay income in the future, on single premium paid by the annuitant. It may be either deferred or immediate annuity.
In case of installment premium annuity, your premiums pay for future payments from the insurance company.

For any information on annuity payment options, visit annuity experts at AnnuityForLife.com, or call at our toll-free number: 1-888-261-6237