Even in the Holy Bible, when Philip asked if a particular man understood what he was reading, the man answered, “how can I,” he said, “unless someone explains it to me?” Annuities, an investment for retirement, are one of those subjects that require extensive research. Even then, all the differences and options can be overwhelming. One needs a teacher or an expert in the field to make sense of all the newfound information.
Fixed annuities, those with a fixed rate, are just one of many annuities available from an insurance company. There are variable annuities, immediate, deferred and lifetime annuities as well as fixed annuities. But other questions arise. How much money should I invest? What is an IPA? Is it good to have inflation protection? What are surrender fees? There are many other questions.
A certified retirement financial planner is one, of many, people to contact to have annuities explained. The same way a salesperson knows our options in their store better than we do, like their inventory, deals and goals, having annuities explained allows you to know the inside information to make wiser decisions. A well versed advisor can cut through all the insurance industry jargon and let you know the essentials. For example, how are annuities different than life insurance? He or she can tell you how to find the right insurance company, which annuity to invest in, what all the terms mean, and much, much more. Remember, these are binding contracts. It takes more knowledge than simply reading the fine print.
Your money probably took a lot of hard work and a long time to accumulate too. A fixed annuity is a good option to see you comfortably through your latter years. Just be sure to have those annuities explained to you before you lay down your signature.