Annuity Products Make Sense Right Now

Now is definitely a good time to purchase annuities, providing you find those that are low cost and have terms you like.  This is the conclusion come to by Dan Kaplinger of the Motley Fool, in his article “Is Now a Good Time for Annuities?”  By far the top fear of those in or nearing retirement is that they won’t have enough money saved to carry them through the rest of their lives.  Annuity products are really the only investment that is structured to insure against the risk of outliving your money.  The lifetime payments you’ll receive take away the risk you have of living longer than your money.

Annuities surely aren’t free and there are many people who don’t think that they are worth the fees, but this article points out that most of their bad reputation comes from a few untrustworthy salespeople and insurers who pay unusually high commissions when annuities are sold.  When it comes to annuity products, you certainly get what you pay for.  Your fees and costs will be higher if you add on riders like death benefits and others, but you only pay for what you want.  By using a strong company and financial advisor, you can spend a fair amount of money on an annuity and guarantee that you’ll never outlive your savings.

Immediate annuity rates are not high right now, but looking across the board at your other investment options will get you the same types of returns.  If you buy an immediate annuity for your retirement now, you will essentially have created your own pension to pay you monthly throughout retirement.  There are also deferred income annuities gaining popularity right now.  They delay your payments until you have reached your 80’s, financing the rest of your lifetime.  With all of the annuity products available, you can surely find one that will fit your needs as well as your fee tolerance.  It’s worth some payment of fees to rest easy knowing that you won’t be running out of money as long as you live.

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