4 key benefits
1. Guaranteed income for life
When you deposit a lump sum of money to buy an annuityAnnuity A contract usually sold by life insurance companies that guarantees an income to you or your beneficiary at some time in the future. An annuity is a contract with a life insurance company. When you buy an annuity, you deposit a lump sum of money, and the insurance company agrees to pay you a guaranteed…+ read full definition, the life insurance companyInsurance company A company that sells insurance products. Some companies sell only life insurance. Some sell only property insurance. Others sell all types of insurance.+ read full definition agrees to pay you a guaranteed income for the rest of your life. You’ll never run out of income — no matter how long you live.
2. Peace of mind
Once you buy an annuity, you don’t need to make any further investment decisions about the money you’ve deposited. And you know exactly how much you’re going to receive every month in income.
3. Options to suit your needs
When you buy an annuity, you can add a number of options. For example, if you’re married, you can add an option that guarantees the annuity payments will continue for as long as either you or your spouse lives. Learn more about annuity options.
4. Meet other financial planning goals
You can use an annuity for other financial planning goals like providing money for your beneficiaries or estateEstate The total sum of money and property you leave behind when you die.+ read full definition, or leaving a gift to charity. For example, an insured annuity gives you a steady stream of income during your lifetime and pays your beneficiaries a lump-sum amount at your death. Learn more about using annuities for other financial planning goals.
Once you buy an annuity, you can’t get your savings out. And your annuity payments are locked in. You can’t change them for any reason.
Buy an annuity when interest rates are higher. You’ll get more income for the same amount of money.
4 key points
- Get a guaranteed income for life
- Achieve peace of mind
- Choose optionsOptions An investment that gives you the right to buy or sell it at a set price by a set date. The buy right is termed a “call” option, and the sell right is termed a “put” option. You buy options on a stock exchange.+ read full definition to meet your needs
- Help meet other financial planning goals