What is an annuity and how does it work?
An annuity is a financial product that can provide a steady stream of income during retirement. It can be purchased from an insurance company and is designed to help people save for retirement.
When you purchase an annuity, you make a lump sum payment or a series of payments to an insurance company. In return, the insurance company agrees to make periodic payments to you, either immediately or at a future date. These payments can last for a specific period of time or for your lifetime.
There are two main types of annuities: immediate annuities and deferred annuities. An immediate annuity is one that pays out right away, while a deferred annuity is one that starts paying out at a later date.
One of the main benefits of an annuity is that it can provide a steady stream of income during retirement. This can help to ensure that you have enough money to cover your living expenses. Annuities can also be used to help diversify your investment portfolio and to pass on your wealth to your beneficiaries.
In summary, an annuity is a financial product that can provide a steady stream of income during retirement. It’s purchased from an insurance company and you make a lump sum payment or a series of payments to the insurance company in return for periodic payments. There are two main types of annuities, Immediate and deferred annuities, which starts paying out at different periods of time.
At Buckalew Financial Services we are here to help you make a wise decision about your future. Give us a call today and one of our agents will be glad to assist!. We will provide the right information for you to make a wise choice. Annuities can seem a little overwhelming, we are here to make it easier.
