Annuities range from being simple to incredibly complex and as an investor it is your responsibility to learn what you may be buying.  The simplest form of an annuity is when you give an insurance company a lump sum and then they provide you with an income stream for a period certain (or life), this is known as a Single Premium Immediate Annuity.  The more complex products are deferred annuities and usually are variable or indexed based.

Would You Buy a United States Government Annuity?

As the baby boomers get older and older it is almost impossible to pick up a financial publication that doesn’t discuss turning one’s nest egg into a stream of income.  It has been a while since I explained both an immediate annuity and deferred annuities, but basically they are financial products that turn a sum certain into a stream of payments.  I personally think they have a place in almost every retirees situation to some extent, but have such a bad connotation that they aren’t used enough.  I can’t believe it took this long, but two finance professors have asked the question [...]

By |2013-09-26T14:59:43+00:00May 10th, 2011|Annuities, Investments|8 Comments

What are Deferred Annuities? Fixed vs. Variable Deferred Annuities

Annuities are easy to understand.  I already introduced the simple single premium annuity but like most things in life it gets a little bit more sophisticated.  Notice that I say sophisticated not complicated; Deferred Annuities are easy if you look at them the way I do!  There are zealots on both sides of Deferred annuities, I don’t do it often on this blog but I am taking the emotion out of it. Introduction to a Deferred Annuity? The easiest way to think about a deferred annuity is like the picture above! You are going to put money into the deferred annuity, either in a [...]

By |2013-09-26T15:01:18+00:00May 12th, 2010|Annuities|2 Comments

What are Annuities? An Introduction to Immediate Annuities

Understanding Annuities makes it easier for you to make an informed decision rather than just listening to an advisor or worse a talking head on television.  Annuities often bring up strong emotions when they really shouldn’t, it is nothing more than a financial product often issued by insurance companies.  The definition of an annuity is simple and straight forward, but like anything else when you dive deeper it gets a little more complicated. The definition an annuity is nothing more than a stream of income for a fixed period of time. If that is the definition what is the easiest type of [...]

By |2013-09-26T15:01:18+00:00May 11th, 2010|Annuities|9 Comments