Fixed Annuities are an excellent option for investing for retirement or other long-term financial goals. They can provide a guaranteed income stream for retirement and help you protect against the possibility of outliving your financial resources. The insurance company promises to make a series of payments to you in exchange for a premium payment that can be made in a lump sum or a series of installments. It can also be used to accumulate money for the future.
Fixed Annuities can create an immediate or deferred income stream, depending on the option you choose.
Secure Your Retirement with Fixed Annuities: Guaranteed Income and Principal Protection
Fixed annuities are financial products offered by insurance companies that provide a guaranteed income stream over a specified period, typically in retirement. They are considered a type of insurance contract rather than an investment, as they offer a fixed interest rate on the principal amount invested.
Fixed annuities can also be used to accumulate money for the future. Depending on the option you choose, fixed annuities can create an immediate or deferred income stream.
- Deferred—this type of investment allows you to accumulate funds over time and offers a variety of future payout choices. Because earnings are tax-deferred, your funds can grow faster over time.
- Immediate—allows you to convert a lump sum of money into a guaranteed payout for as long as you live or for a certain number of years.
Here’s how they generally work:
- Purchase: You pay a lump sum or a series of payments to the insurance company, which becomes your principal investment.
- Accumulation Phase: During this phase, your principal earns interest at a fixed rate determined by the insurance company. The interest is typically credited on an annual basis and compounded tax-deferred until withdrawn.
- Annuitization: At a predetermined date or upon your reaching a certain age, you can convert your accumulated value into a stream of income payments. This is known as annuitization. Depending on the terms of the annuity contract, the payments can be guaranteed for a specific period or for the rest of your life.
Fixed annuities offer several advantages:
- Guaranteed Income: They provide a predictable stream of income, which can be valuable for retirement planning.
- Principal Protection: The principal investment is usually protected, meaning you won’t lose money due to market fluctuations.
- Tax Deferral: Earnings on the annuity grow tax-deferred until they are withdrawn.
Fixed annuities can be a suitable option for individuals seeking a stable source of income in retirement, especially those who prioritize safety and predictability over potential higher returns. It’s essential to carefully consider your financial goals and needs before purchasing an annuity and understand the terms and features of the product you’re considering. Please Contact Us to discuss if fixed annuities are the right choice for your financial future.
Read Our Financial Insurance Blog Posts
Steps to Take When Renewing Your Insurance
Reasons to Purchase Permanent Life Insurance
Contact Us
Communities
Murphy Insurance Agency provides insurance solutions across Massachusetts and New England. Where you live is not a barrier to our assisting you. We are proud to serve the communities where our customers live and work, including Acton, Ashland, Ayer, Bellingham, Berlin, Blackstone, Bolton, Boston, Boxborough, Boylston, Chelmsford, Clinton, Concord, Devens, Dunstable, Fitchburg, Foxborough, Framingham, Franklin, Groton, Harvard, Holliston, Hopedale, Hopkinton, Hudson, Lancaster, Leominster, Littleton, Lunenburg, Marlborough, Maynard, Medfield, Medway, Mendon, Milford, Millis, Millville, Natick, Norfolk, Northborough, Northbridge, Pepperell, Sherborn, Shirley, Shrewsbury, Southborough, Sterling, Stow, Sudbury, Townsend, Upton, Uxbridge, Wayland, Westborough, Westford, Weston, Whitinsville, Worcester, and last but not least, Wrentham.
About Us
Get A Quote
- Quote Overview
- Auto Insurance Quote
- Homeowners Insurance Quote
- Condominium Insurance Quote
- Renters Insurance Quote
- Umbrella Liability Quote
- Valuables Coverage Quote
- Boat Insurance Quote
- Business Insurance Quote
- Employee Benefits Quote
- Life Insurance Quote
- Disability Insurance Quote
- Long-Term Care Insurance Quote
- Other Insurance Quote
Resources
Personal Insurance
Business Insurance
Legal
Read Our Blog
Recent Posts
- Decorate Safely During the Holidays November 26, 2024
- Thanksgiving Safety Tips for a Happy Holiday November 22, 2024
- Vehicle Breakdown Safety Basics November 20, 2024
- How Insurers Calculate Premiums November 13, 2024
- Preventing Drowsy Driving November 5, 2024
- Daylight Saving Time Change: A Perfect Reminder to Check Your Smoke and CO Detectors October 23, 2024
- Why Flood Insurance is Essential: Lessons from Hurricanes Helene and Milton October 21, 2024
- Defensive Driving to Avoid Deer Collisions October 5, 2024
- MA Dept of Industrial Accidents New Notice Requirements September 10, 2024
- Factors Affecting Your Car Insurance Rate September 6, 2024
- Why Personal Liability Insurance is Essential for Homeowners, Condo Owners, and Renters August 14, 2024
- Recognize Spam and Phishing Emails August 5, 2024
- How Distracted Driving and Texting Impact Your Auto Insurance Premiums July 17, 2024
- Keep Your Home Safe While on Vacation June 26, 2024
- 5 Tips for Adding a Teen to Your Auto Policy June 21, 2024