Whenever we talk about annuities, we cannot stress enough the importance of having a professional, such as a financial advisor, work with you on deciding first of all if an annuity even meets your needs. Once decided, perhaps even more important is to decide what the best type of annuity would be to meet your needs? Because the choices are so numerous, without proper understanding from a specialist as to exactly how an annuity works, could result in a very costly mistake.
You may in fact already have an annuity, and not even be aware you have one. The most common reason for this is when the annuity is in the form of an IRA (Individual Retirement Account). Often times people will refer to their IRA, and not even know their IRA is actually an annuity. Also, because an annuity is an insurance product, it can sometimes be thought of as an insurance policy.
Not understanding how an annuity is structured, whether there are any living or death benefit guarantees, is another common issue. These can be very significant, and can affect the intentions of the owner of the annuity, as to how he/she expects the proceeds from an annuity to either be made available, or to pass benefits on to children and grandchildren.
Most annuities have some type of surrender charge connected to them, and to cash out an annuity before you know if there are any surrender charges to be paid can become very costly. We can review any annuities you may have and make appropriate recommendations as to how they should be handled.
Probably the majority of individuals are not aware of the many improvements made to annuities over the years, and there are many choices available in selecting an annuity to meet your needs. A common mistake is to consider all annuities the same, and we can show you that nothing is further from the truth.
Also, a common mistake is to take action on an existing annuity that may trigger a negative tax event. The tax consequences as a result of making the wrong decision on how you handle your annuities can be very costly. We can provide a review of your existing annuities and guide you in making decisions with your best interest in mind.
Should you decide to contact us for further information about annuities, remember to ask us about how a certain type of annuity can provide you with a guaranteed income for life. If your primary objective is to pass assets to your children and grandchildren, ask us to explain to you how you may be able to pass assets down to multi generations.