About Immediate Annuities… It's time to learn more about why people buy them
IAIf you weren't lucky enough to work for a company with a pension, then here's your chance to buy one for yourself. You can do this with an immediate annuity by exchanging a lump sum of money for a guaranteed income stream you can't outlive.
If you have an annuity, you may choose to annuitize your contract. You trade the value of your contract for the issuing company’s guarantee to make payments to you for a certain period, for your lifetime or for one of the other options described below.
…immediate annuities have little or no accumulation phase.
You purchase it with one payment and may begin receiving income payments right away (within 12 months). You might consider this type of annuity if you received a large sum of money through an inheritance, for example. An immediate annuity could help secure your financial future by locking in a guaranteed income stream.
Which type of Immediate Annuity should you consider?
Depending upon your purpose, we can help you evaluate these options and make the best choice.
You can choose to receive income payments that will never run out, no matter how long you live. The amount you’ll receive depends on your account value and life expectancy for people of your age and gender. A drawback to this guarantee is that payments stop at death, even if the total of the payments is less then your original cost.
A joint-and-survivor option guarantees income payments for as long as either you or your spouse (the annuitant or the co-annuitant) is alive. This may be an option if you want to be sure the surviving spouse also has income for life. Payments are based on the considerations explained in the "income for life" section.
You can receive income for a certain period, such as 5, 10 or 20 years. The amount of each payment depends on your account value and the time period you choose. This can help you bridge the gap between the end of one income source and the start of another, or to cover a liability that is expected to last a certain period of time
Some companies let you lock in a guaranteed amount for each income payment. The number of payments you receive is based on your account value and other factors. You may need additional sources of income when this payment option ends.
This option will guarantee an income for your life-time, but if you die before a specified time period, your beneficiary will receive income payments until the period ends.
In addition to those explained above, annuitization options are available to suit a broad variety of needs and life situations. Your financial professional can help explain other options that may be appropriate for you.