The purpose of an annuity is to protect against the financial risk of living too long…the risk of outliving retirement income…by providing an income guaranteed* for life.
In fact, an annuity is the ONLY financial vehicle that can systematically liquidate a sum of money in such a way that income can be guaranteed for as long as you live!
Here’s How an Income Annuity Works:
The annuity owner pays a single premium to an insurance company.
- Beginning immediately or shortly after the single premium is paid, the insurance company pays the owner/ annuitant an income guaranteed to continue for as long as the annuitant is alive. There are other payout options also available.
- With a cash refund provision the insurance company pays any remaining funds to the designated beneficiary after the annuitant’s death.
Seeking a secure life long retirement income? Click the video box to left of this post.