The idea behind fixed annuity started out some time during the mid-seventeenth century when the Presbyterian Church moved to provide an annual pension for widows and its elderly members. Fixed annuity is basically the same today as it was in those days, only that it is common to see a tax deferment clause in a lot of annuities during this time.
In fixed annuity, your are given the chance to invest in a tax-free fund for a specified period, but when it is time for you to withdraw your money, you will be taxed as if you are receiving a regular income — this is called annuitization.
Most fixed annuity companies today give you the option to receive a guaranteed income for life. You can also choose to be paid for a specified number of years, and this can be a great thing especially when unfortunate things, such as an illness and disability, happen.
Now you may wonder where you can find a fixed annuity company. There is practically none of the kind. The best that you can go for is an insurance company that offers the fixed annuity program. Licensed insurance brokers and agents are also selling annuity programs.
It is always a great move to buy annuities from a fixed annuity company because even if that company goes bankrupt or something, the other insurance companies in the state are required by law to honor the conditions of your contract.
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