Annuities for Seniors
If you are nearing the retirement age and want to secure your financial status for the future, annuities can work as ‘tax deferred investments of unlimited funds for life’. You may already know about the basic features of annuities. Here, let’s learn about annuities for seniors and how they can help individuals and families who are entering the retirement phase or the golden age of sixties.
While annuities provide several benefits in the form of increased rate of growth in savings through its tax deferred feature, high returns, and security, another important benefit that comes along with is life insurance or insurance against financial instability. You can invest as much as you want in an annuity, leave it there to grow as per the rate of interest promised to you, and withdraw the money when you need it. There can be several choices about how to and when to withdraw your money, but if you are looking for an alternate source of income, you can choose to receive an amount every month, lifelong.
A fixed annuity is often a good choice for seniors as it offers the promise of a steady income. Fixed annuities can be term certain if you want it to range over a particular time period, or it can be life annuity if you want to receive paybacks from the annuity till death. Several fixed annuities offer special features that can be useful for senior citizens. While an annuity with systematic or flexible withdrawal options may include an income paid to you for life and give you the freedom and pleasure of drawing your own pension, an annuity with an optional feature like principal guarantee may commit to return you at least the initial premium you had paid, when you surrender the contract. A few annuities, keeping the needs of the senior citizens in mind, attach the feature of a nursing home waiver. These actually relieve you of the surrender charges if you fall sick, at any time during the annuity period, and require to encash the annuity to pay for your nursing home bills. Apart from these, some annuities come with certain unique features, such as reduced fees and expenses on annuities for seniors, a reduced minimum investment for seniors particularly, no up-front sales charges or recurring fees, and of course, no surrender charges.
Most annuities also offer death benefits to ensure that the remaining value of the annuity passes over to the heirs or nominated individuals, if the annuitant dies before the annuity period is over.
The amount of payback for fixed annuities depends on the amount you have invested as well as on your life expectancy. Whatever be the amount, the assurance of a steady income is often very useful to senior citizens. For elderly individuals, this can be an open road to freedom. According to a survey by the researchers of the Guardian Life Insurance Company, New York , almost 71 percent of the population said ‘the idea of owning a retirement vehicle that provides a steady stream of retirement income seems very appealing’.
