– Sponsored news – It can be hard to plan for retirement and keep your plan on track. You need to ensure your money grows to last as long as possible. Life insurers offer a product that can help people overcome this problem. It is called a variable insurance policy.
Variable annuities are similar to a 401 (k) plan in some ways. You can save tax-deferred and invest in accounts linked to the stock exchange or at guaranteed rates. A variable annuity is similar to a 401 (k) but works best when it’s part of a long term planning strategy. Variable annuities are different from many 401(k), in that they offer a guaranteed stream for retirement income, which can be used to supplement Social Security. In other words, the guarantees of a variable annuity provide two essential elements to any comprehensive retirement plan: financial security and peace-of-mind.
Variable annuities have fees, just like all financial products. Annuity management fees, similar to mutual fund fees, are charged. Annuity fees also cover unique insurance elements like guaranteed lifetime income in retirement. This feature is not offered in any other financial products.
Annuities may include additional features to address financial concerns. An example of such a feature is that annuity payments will not begin until you are dead. Your designated beneficiary will then receive an annuity benefit. The annuity contract will specify the amount of the benefit. This guarantee is valid even if the stock market does poorly.
Additional charges can be triggered by early withdrawals from variable annuities, which are intended to be long-term planning tools. These are also known as surrender or withdrawal charges. These charges can be eliminated at the end of the contract’s specified time. They may be waived by annuities in certain circumstances, such as death, confinement at a nursing home, or terminal illness.
Variable annuities are one of the most tightly regulated financial products on the market. These regulations offer variable annuity holders significant protections. Life insurers must adhere to all state and federal laws that protect consumers’ rights, from product development to sales advertising.
Variable annuities are not for everyone. However, variable annuities have made a difference for millions of retirees. They provide financial security and a way to avoid financial disaster.
You can find more information about variable annuities, and how they might fit into your retirement plan at the American Council of Life Insurers’ website, www.acli.com.
