What is an annuity?

An annuity is an insurance policy. If you are getting ready to retire, it could be an option. Here is how it works: http://www.findlocalinsurance.com/variable-annuity.html

An annuity is a contract between the buyer and an insurance company. In general, the insurance company promises to do something with the buyerâ€™s money -- like grow it or pay it out over a number of years. This page should serve as a general overview of annuities. After you understand the concept you can look into the various annuity types.

Annuities can be helpful in some situations. In general, some benefits are:

Tax-deferred growth and compounding within the annuity contract
Guaranteed rates of return on your dollars
Guaranteed lifetime payments if you annuitize (in some cases you donâ€™t even have to annuitize in order to receive this benefit)
Other features that may be important to you. These are various bells and whistles that do very specific things
Note that the guarantees are only as strong as the insurance company that issued the annuity. In other words, if the insurance company fails, the promise is no good. I recommend mitigating this risk by using only the strongest insurance companies out there.

The contract owner is the person that owns an annuity. Note that a â€œpersonâ€ can be an entity in this case.

Contract Owner Activities

The contract owner goes through the process of purchasing an annuity. The contract owner is generally the person who signs all the paperwork and funds an annuity contract. The contract owner agrees to the terms of an annuity contract.

Contract Owner Rights

The contract owner chooses an annuity and makes decisions on all the details â€“ when it starts, how much money goes in, when money comes out, and so on.
The contract owner also chooses the beneficiary and the annuitant in an annuity contract. In many cases, the contract owner may choose himself/herself as the annuitant.
If the annuity offers a variety of investment terms and choices, the contract owner also makes these choices.

Contract Owner Restrictions

Of course, the contract owner can only choose from whatâ€™s available in a given annuity. Each annuity out there has different options and restrictions. Even though the contract owner gets to make choices, the contract owner may have to pay a fee or penalty for certain actions.

If u know pension it means same as annuity. In india there are many firm which offer annuity...............the system work this way 1. the firm collects money in installments or a lump sum amount from a customer
2. it then either invest the same money or Loans it to any other people or firm.
3. the profit generated is given to the customer on yearly or monthly basis as decided for a predecided basis of time and conditions

its a good source when u're retiring...where u put in one lump sum before retirement n get it after u're retired either by monthly/yearly. and it gives you coverage in terms of death(so tt ur dependents need not worry so much bout money needed to pay for funeral costs,loans...so on n so forth). you should check with insurance companies for these since banks will

An annuity is any type of plan that pays out in monthly (sometimes weekly or annually) payments.

Most lotteries are annuities.

Pensions are annuities.

Some insurance settlements are annuities.

A land contract or mortgage can be considered an annuity too.

The US government has info on them, here it is http://www.sec.gov/investor/pubs/varannty.htm

An annuity is a tax deferred savings account issued by a financial advisor at an insurance company.

With an annuity, the principal return is tax-deferred, and you will only pay taxes upon withdrawal of funds. So as your saving - you pay no taxes! The result over the long-term is more cash available to earn interest.

something you should NEVER buy. A gold mine for banks & insurance companies

If life insurance is used to protect you from dying, an annuity, than, can be said to protect your from living too long.

An annuity is a type of savings vehicle, this vehicle can be used in different forms. They can be taxable or tax-differed, fixed or variable. They can also have many settlement options, so one simple answer does not fit all annuities.

However, simply put, you contribute money to the annuity, until it comes time to annuitize it, that means it starts paying you back. This can happen immediately or down the road. The payout can be for a defined period of time, or forever. There are many options, you should speak to a qualified insurance agent about.

An Annuity is a Savings Contract between you and an insurance company. There are several kinds of Annuities. The ones you want to stay away from are the Variable Annuities. They are invested in the stock market and very risky. Unfortunately the people who say don't do them, don't know your situation. If you are single, they avoid probate (a huge help to your heirs), they are tax deferred, they offer very competitive interest rates, and most are available for no fees to you, if you don't go through a broker. They can be turned into a monthly income, but do not have to be. You can let them sit and grow tax deferred for as long as you like, or you can take up to 10% out every year, etc... Pretty great tool for folks who want their money safe, and don't want to pay a broker, or Financial Planner to lose their money in stocks and mutual funds. Great idea for the right situation.

you should speak to an insurance broker about an annuity...its a type of pension fund....

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