When you were growing up, your parents probably told you that you needed to save money for retirement. They probably also told you that you should get an annuity. But how much do you understand about annuities in Farmington Hills? Well, guess what? If you don’t know much, you’re not alone.
In fact, according to the latest report by the Bureau of Economic Analysis, 40 percent of Americans have no idea what an annuity is, and more than 50 percent of Americans don’t know what they need to do with an annuity to be comfortable in retirement.
This is a problem. The number of people in the U.S. who are not saving enough for retirement is growing. If you don’t save for retirement, you’ll end up living a life of financial insecurity in the future.
Frequently Asked Questions About Annuities
What is an Annuity?
An annuity is a contract between you and an insurance company. You pay money upfront, and then the insurance company pays you a set amount of money for as long as you live. In other words, you’re paying for the insurance company’s promise to pay you a certain amount of cash.
The benefit of an annuity is that you know exactly how much money you’re going to get every month, but that’s not to say there’s no risk. The amount that you receive every month is based on some factors, such as your life expectancy, how much you’re paying in premiums, and the interest rates that the insurance company is charging.
However, the beauty of an annuity is that you can always count on a certain amount of money.
Is an Annuity Good for Me?
For the average American, an annuity is a great option because it provides you with a guaranteed income in retirement. You don’t have to worry about market volatility or whether you’ll be able to afford your retirement lifestyle. Thus, an annuity is perfect for everyone who wishes to have a steady stream of payout after they retire.
What Happens to My Annuity After I Die?
When you die, your annuity will be distributed to your beneficiaries or the people you designate to receive your money. For example, if you have three beneficiaries, then your annuity will be distributed to all three of them. In other words, your annuity will be divided by the number of beneficiaries you have.
A person who is single is going to get a different amount of money than a married couple. In case of divorce, you can name the other beneficiary to get their share, or if you’ve designated an executor, then that person will receive the money that’s left after all of the beneficiaries have been paid.
Why Do Other People Hesitate on Getting an Annuity?
The main reason people hesitate on getting an annuity is that they’re afraid of the risk. But the truth is that the risk is very small. If you’re worried about it, then you should talk to an annuity professional. An annuity professional will walk you through the whole process.
They’ll explain how the annuity works, how the insurance company will pay you, and how much you’re going to get every month. They’ll also help you decide whether an annuity is the best option for you or a conventional retirement plan will do. An annuity is one of the best options for retirement. But you need to know the facts before you decide to move forward.
Looking for Professional Guidance with Annuities in Farmington Hills?
ABB Wealth Strategies has been in the insurance industry for almost four decades. We have helped many clients plan their retirement and streamline their savings to secure their financial future. The future may hold the most uncertain possibilities, but with our help and guidance, you can rest assured that your financial future is the least of your concerns.
Contact us today to learn more about how we can help you secure your future.