Deciding To Purchase an Annuity Is One Of The Most Important Decisions You Will Make
If you have begun to think about what to do when you are getting ready to retire, and if you have any sort of pension fund, you have probably heard the term annuity mentioned quite a lot. An annuity is a delightful cross between an investment and an insurance policy, which will protect you from running out of income before you die. When you purchase an annuity, you are essentially making sure you have a guaranteed income for life regardless of any changes in interest rates or the stock market. Many people who purchase an annuity do so in order to provide themselves with supplementary income to their existing pension plans.
Are All Annuities the Same?
Annuities are not all created equal, and many of them offer different interest rates. If you want to get the most out of your investment, you should examine which ones provide you with the best interest rate. The rates that are available to you will change based on your age and the prevailing yields at the time of your investment. If you choose an option such as escalating income or inflating-proofing your annuity, that will also be taken into consideration.
Because the factors that determine your interest rate can be so different, it is important that you shop around quite a lot when purchasing an annuity so you can make sure you are getting what works best for you. You can do this by speaking to a number of different insurance companies or using an online annuity quoting service. This will show you what all is out there available to you instead of simply accepting what is being offered by your existing pension company. You might be surprised by the different quotes you will get. Many can vary based on the post code you live in, if you are a smoker, or if you have any sort of health issue that may shorten your life-expectancy. If an insurance company feels you will not live as long based on your lifestyle, they may not give you the best life insurance rates, but they will likely give you a higher interest rate on your annuity.
Choosing the annuity that is right for you is not as simple as merely getting the best rate available. It is extremely important you speak with a financial advisor who specialises in retirement income to learn what the best option for you is.
Are All Annuities the Same?
Annuities are not all created equal, and many of them offer different interest rates. If you want to get the most out of your investment, you should examine which ones provide you with the best interest rate. The rates that are available to you will change based on your age and the prevailing yields at the time of your investment. If you choose an option such as escalating income or inflating-proofing your annuity, that will also be taken into consideration.
Because the factors that determine your interest rate can be so different, it is important that you shop around quite a lot when purchasing an annuity so you can make sure you are getting what works best for you. You can do this by speaking to a number of different insurance companies or using an online annuity quoting service. This will show you what all is out there available to you instead of simply accepting what is being offered by your existing pension company. You might be surprised by the different quotes you will get. Many can vary based on the post code you live in, if you are a smoker, or if you have any sort of health issue that may shorten your life-expectancy. If an insurance company feels you will not live as long based on your lifestyle, they may not give you the best life insurance rates, but they will likely give you a higher interest rate on your annuity.
Choosing the annuity that is right for you is not as simple as merely getting the best rate available. It is extremely important you speak with a financial advisor who specialises in retirement income to learn what the best option for you is.