A Few Things To Understand About Using Annuities For Your Retirement

If you, like many people, are concerned that your Social Security benefits will not be enough to survive on, you are probably wondering what you can do to ensure you will be financially stable once you retire. If you have been working at the same company for many years, they may have a retirement benefit. You may have invested in a 401K or IRA, or you may have done nothing at all yet. While you are thinking of the different ways to invest in your future, contact a company that offers annuity services. Here are some facts about annuities you may not know.

Sold by Insurance Companies

Annuities are a product sold by insurance companies. Buying them allows you to save money and earn interest on it without paying any taxes until it is used as income. Because it is a product, there is no limit to the amount of money you invest in one, unlike an IRA. You choose how involved you want to be with the annuity and when you want to start receiving income from it. You will work with someone to determine how much you need to invest to receive the payment amount you need. Everything can be arranged so that you will receive payments for the rest of your life.

There are Fees Involved

The insurance company is going to make money on annuities. They not only charge a fee to get everything set up and started, they will charge fees to manage the annuity over the years. Before you decide on a company, make sure you get a few different quotes and a list of all the fees you will be charged. You may want to talk with a financial planner to go over all the data and help you determine which one will cost you the least while providing you with the most when you need it.

Leaving Something for the Family

It is possible to put aside some of the money invested and its interest for your family after you have passed. However, this must be discussed and arranged for, otherwise, the insurance company will keep everything they did not guarantee to pay to you. Make sure this is part of the contract when you set it up.

Unless you plan on working until you pass away, you need to start planning for your retirement. IRAs, 401Ks, and retirement benefits are all good and can add to our social security benefits. However, do not overlook annuities because you don't know enough about them. Talk with an insurance company that offers annuity services and then decide which strategy will work best for you and your family.