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Things to consider regarding annuities

Posted On Thu, October 22, 2009

Some consumers may wonder if annuities would be a good choice for their long-term financial plans.

Recently, the Insurance Information Institute (III) noted there are a number of questions people should ask themselves before they decide to start looking for annuity quotes. For example, some annuities are more risky than others because they rely on stock investments.

Furthermore, people looking at annuities should make sure they have emergency funds saved up before they look to them for investment opportunities. The III states that if the consumer does not have cash in reserve, an annuity is probably not something they want to pursue.

When looking for annuity quotes, consumers should make sure to note that different annuities offer different terms.

"Shop around, because they all have different fees and different early withdrawal charges," the III stated.

Along with different fees and charges, annuities differ when it comes to payouts after death. Some annuities offer continued payments to beneficiaries, while others do not. Finally, consumers should make sure to take into consideration their age and health when shopping for annuities.

A story from the New Jersey's Star-Ledger newspaper noted that there are a number of benefits in investing in annuities. Investing in annuities gives consumers a tax-deferred investment opportunity that also can provide a stream of income in their later years. However, like the III, the report from the newspaper noted that consumers should make sure they pick a product that is right for them.
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