An immediate annuity offers you the ability to get immediate payments when you invest a lump sum through an insurance contract. Most people who need to bolster their retirement income because they lost most of it or didn’t start investing when they were younger utilize this annuity type. However, every individual’s situation is different and needs to be planned for accordingly.
Fixed annuities offer you a set interest rate earned on your returns. This means that when you invest through an insurance contract, the money you potentially make back will have a fixed interest rate that adds to what you invested, similar to a savings account but better.
If you’re looking to grow your money and get interest back on your returns, the fixed index annuities are a great option. These offer you a guarantee* on your principle, as well as a fixed interest rate on your returns. The primary difference between fixed annuities and fixed index annuities is that the interest gained is based on the stock market indices.
*Annuity guarantees rely on the financial strength and claims-paying ability of the issuing insurance company. Annuities are insurance products that may be subject to fees, surrender charges and holding periods which vary by carrier. Annuities are NOT FDIC insured.