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At Harlow Wealth Management, we can help you determine a strategy appropriate for your financial situation.
Annuities can offer many benefits during retirement, including a reliable source of steady income. There are several types of annuities, each with unique benefits and challenges. Here at Harlow Wealth Management, we want to help you understand all of the options available to you and find the addition that fits most appropriately in your retirement strategy.
One of the products we offer is a fixed annuity. As with all financial vehicles, this one has specific terms and details that are essential to understand before you decide to purchase an annuity. Read on to learn some important aspects of fixed annuities.
How Do Fixed Annuities Work?
Like all annuities, a fixed annuity is a contract between you and an insurance company. You agree to provide a lump sum or premium payments, and the insurance company agrees to pay you a fixed amount on a regular basis for an agreed-upon amount of time. Rather than being subject to changing interest rates, fixed annuities keep the rate that is locked in during the purchase for a given amount of time specified in the contract.
What Are the Benefits of Fixed Annuities?
Because the interest rate doesn't change during the contract period, a reliable and predictable rate of growth without worrying about how market factors will affect your account value because these are not tied to any external market. Some additional benefits include:
- Protection from creditors and probate proceedings
- Guaranteed interest rate during the contract period
- Tax deferment on interest credited to the contract until you begin receiving payments
Who Should Consider a Fixed Annuity?
While fixed annuities have many advantages, they are not right for everyone. If you are looking for a steady, reliable income in retirement that is not dependent on market factors or changing interest rates, this type of annuity could be an excellent fit. If you can’t qualify for life insurance you may be able to further customize an annuity by adding a long-term care rider to the base contract to help you afford the cost of long-term care expenses should you need to pay for it down the road.
Contact Us To Learn More
Here at Harlow Wealth Management, we want to help you create a customized investment and retirement income strategy. If you have more questions about fixed annuities or would like to discuss your overall retirement planning, fill out this form or call 800-782- 2136 to schedule a no-obligation meeting.
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