Annuities are forms of financial protection.  An annuity is a contract written by a life insurance company to provide continuing income, typically for retirement. Payments, which are generally made on a monthly basis, are usually arranged to continue for as long as you live or for a stated period of time. Payments may begin at once or at some future date.

The annuity contract is often described as being the opposite of life insurance. It pays while you live; life insurance pays when you die. Actually, the two can complement each other. Instead of lump sum benefit payments, many life insurance beneficiaries choose to use their policy's proceeds to purchase an annuity.
You should tailor any decision to buy an annuity to your own needs. To do so, talk with a qualified life insurance agent or financial advisor.

Annuities are defined by three major componenets.

• Their guarantee to pay back at least the principal of the investment
• Their option for the recepients to receive payments for life
• The penalty that is often (but not always) associated with withdrawing money from the annuity before a specified date

Life insurance, CD's and 401k's may seem similar to an annuity, and in a lot of ways they are. However an annuity differs from these other types of investments in subtle, yet important, ways such as...

• Annuities do not require an health exam, as most life insurance policies do.

• Annuities are a safe investment to make than other investments because the principal (amount of money initially invested) of an annuity is backed by an insurance company's assets. The only way an investor can lose the principal on their annuity is if the insurance company itself failed. That is why it is so important to make sure you are investing in an annuity with a strong insurance company. We can help you make that distinction here. Simply fill out the form to your left to get started.

Annuities continue to make payments until the death of the investor. In the event that the investor dies before the distribution phase begins, some annuities are structured so a beneficiary or next of kin receives a lump sum or the annuity payments.