Some terms can be used by financial advisers and money pages in the newspapers that end up making a simple idea sound more complicated that it really is. An annuity is one of these words, although it is actually a very straightforward concept that most of us are already familiar with. Basically, an annuity is any continuing payment with a fixed total annual amount, therefore it can refer to any stream of fixed payments over a specified period of time or in the case of a ‘Life’ annuity a financial contract providing payments for a person’s lifetime. Fixed And Variable Annuities As with many other financial products, there are both ‘fixed’ and ‘variable’ versions of an annuity. Variable annuities are used for many different reasons, often to do with deferring taxable gains. Money deposited in a variable annuity usually grows on a tax-deferred basis so that any taxes due on the gains made from that investment are not due until a withdrawal is made. Insurance Products Other annuity products include joint-life and joint-survivor annuities, where payments stop upon the death of one or both of the parties. There are many different types of life cover apart from annuities, so it is important to make sure you are aware of all the various packages and products on offer before you decide which one is right for you. The easiest way to work out what you could expect to gain from this kind of product is to use an online annuity calculator like the one provided by Moneyvista.com. By simply entering some basic details you can quickly and easily find out all you need to know. Budget As with any kind of financial planning, you need to work out exactly how much money you can afford to put aside for an annuity and to make sure that you won’t become over stretched at any point in the future. There is little point if it means making sacrifices that are simply too expensive in the present moment. Professional Advice Of course, arming yourself with as much information as possible is the only sensible way to approach any financial planning move, but often there does come a point where professional advisers can help you make the most of the route you decide to take.

H. Abbas

My name is H. Abbas. I blog, therefore I am - And I am a real web enthusiast that loves to write on several topics and niches. If you like (or dislike) my posts then please comment and I will be sure to read and comment back!

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