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Annuity Basics
In its most basic form, an annuity is a contract
between the contract owner and the insurance
company to pay the annuitant equal installments over
an agreed period of time in return for an up front
payment or payments.
So much for basics. As with nearly all financial
products there are many variations. The simplest
annuity is a Single Premium Immediate Annuity. As
the name implies the owner pays a lump sum of money
and starts getting payments immediately. These
payments can be scheduled over a defined number of
years or a lifetime. Originally, these products offered
a fixed yield over the life of the
contract. Contemporary products offer yields that
are tied to a financial index like the Standard & Poors
500.
A straight life annuity provides the greatest income
per month for the life of the purchaser. However,
should the annuitant die before the principal is
depleted, the balance is, in effect, forfeited to the
insurer. Nevertheless, this is a popular option for
those seeking a reliable stream of income for
retirement purposes, because the money will
never "run out." Other income options include period
certain, life with period certain and joint and full
survivor.
The lump some of money, or principal, required to
fund an annuity can be created in one of two ways:
With an immediate annuity the purchaser purchases
the annuity contract with a single, up front, sum of
money - the premium. An annuity may also be
funded with a series of payments over time. An
annuity can be used for retirement purposes, to fund
a college education or to secure Long Term Care
benefits for consumers who would not otherwise
qualify for conventional Long Term Care Insurance.
Vern Bell Agency Web Site
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An annuity is essentially the mirror image of life
insurance. The principal function of life
insurance is to create an estate, or lump sum of
money, by making periodic payments to the insurance
company. The function of an annuity is to take a
lump sum of money and turn it into a stream of
periodic payments to the annuitant.
Annuities have become incredibly popular, especially
since the Internet bubble burst. Many new kinds of
annuities have been developed. Some provide a
guaranteed minimum yield while allowing the owner to
participate in market gains. Others address
special needs. This issue is
devoted to
clearing up some of the confusion that surrounds
these highly
innovative products.
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| Annuity funded Long Term Care Insurance? |
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A new kind of single premium deferred annuity has
been developed that combines long-term asset
growth and long-term care protection. This product
initially credits interest to the full contract premium
at two interest rates. One rate is applied to the Long-
Term Care (LTC) Fund, the other rate is applied to
the Cash Value Fund. These funds are linked -- a
withdrawal from one will reduce the other
proportionally so that when one fund is reduced to
zero value, the other is also reduced to zero and the
policy and rider end. The product has both a
guaranteed and a non-guaranteed yield.
The real beauty of this kind of product is that
consumers who have been declined for conventional
Long Term Care Insurance may may be approved for
this annuity based product. The only way to know
for sure is to apply. I can help you with that. Just
click on the following link and call or email.
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Contact us.. |
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| Permanent Life Insurance funded Long Term Care Insurance? |
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Permanent Life Insurance never expires.
That is, as long as you keep up the premium the
insurance benefit will pay out no matter how long you
live. This kind of Life Insurance is more expensive
than Term insurance. But, unlike Term, these
products accrue a cash value over time. Recently,
Insurance Companies have introduced products which
fund Long Term Care Insurance using a Permanent
Life policy. Again, the objective is to give more
consumers access to Long Term Care Benefits.
If you
would like to discuss any of these highly
innovative products feel free to call or email me.
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| Top Ten Life Insurance Blunders |
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If you're considering buying, increasing or replacing
your life insurance there are many pitfalls to
consider. I've composed a list of the Top Ten
blunders I see clients make over and over. Click on
the web link to see all ten. Then call or email for a
free no-obligation quote.
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Link to Top Ten Blunders.. |
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| New Contact Info |
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Please note that my contact information recently
changed. My new address and phone number are on
my web site. The email address remains the same.
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Link to new contact info... |
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