Some people look down on annuities as investment vehicles because they tend to pay lower rates than stocks and some other investment opportunities. At the same time, there are some strong arguments in favor of having an annuity as part of your retirement portfolio, including:
1. Annuity income is predictable. You know how much you will receive each quarter and can budget accordingly.
2. If your budget permits, annuity proceeds can be reinvested in more aggressive investments, without risking your main retirement nest egg.
3. Annuity investors can have confidence they will not outlive their income, an important consideration as the average lifespan increases.
4. Annuity contracts can be written so that a spouse, children or other heirs will receive payments for a guaranteed period, even if the main beneficiary passes sooner than expected.
5. Annuities can be used as investment vehicles, with variable rates paid based on mutual fund performance. More conservative investors can choose fixed rate annuities, which will pay the same amount regardless of the market’s status.
Save-On Health Insurance Services, in Los Angeles, California, can help you with all of your retirement and insurance needs. To learn more or schedule an appointment, contact us.
