Annuities 

To put it simply an annuity is a contract between a person and an insurance company.  This contract allows an individual to make a lump-sum payment or a series of payments and, in return, receive regular disbursements beginning either immediately or at some point in the future. The goal of an annuity is to provide a steady stream of income,  typically during retirement. In other words, annuities protect individuals from outliving their money. 

There are many different reasons why annuities are advantageous for individuals  looking to save and invest their money. In a properly structured annuity, an individual  can double their money without the fear of significant loss. Annuities are flexible and  can be easily tailored to meet the needs of individuals and their unique circumstances.  Furthermore, they are safe, reliable, and have family benefits. The most significant  reason to obtain an annuity is for wealth management purposes or to qualify for  Medicaid. For example, if an individual wanted to have a guaranteed amount of funds  for the rest of their life, it would benefit them to purchase a properly structured annuity  before they retire; this would have premium payments for a specified amount of time or a large lump sum when they are ready to retire. The great thing about annuities is they  are flexible and do not have to be used in one certain manner. It is paramount for  individuals to have the right annuity structured for them, it needs to reflect one’s  financial portfolio and pair with their estate planning. There are tax benefits to owning an  annuity. Annuities are tax-deferred on growth. You pay no taxes on the income and  investment gains from your annuity until you withdraw the money. 

The different types of annuities are the following: 

Fixed annuity- The insurance company promises you a minimum rate of interest and a  fixed number of periodic payments. Fixed annuities are regulated by state insurance commissioners. 

Variable annuity- The insurance company allows you to direct your annuity payments to  different investment options, usually mutual funds. Your payout will vary depending on  how much you put in, the rate of return on your investments, and expenses. The  Securities and Exchange Commission regulates variable annuities. 

Indexed annuity- This annuity combines features of securities and insurance products.  The insurance company credits you with a return that is based on a stock market index,  such as the Standard & Poor’s 500 Index. 

It is important to find the right annuity product for you, it starts by talking to a  professional. Annuities are wonderful tools and if utilized properly will generate financial security and stability for individuals and families. With the collaboration of the consumer and the insurance professional, an annuity may be the best and most effective product.

Ryan Begley

Benefit’s Specialist

704-749-9244

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Greg McIntyre, JD, MBA

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Greg McIntyre, founder of McIntyre Elder Law, is more than just an attorney. As a Navy Veteran, father to six kids, and a loving husband, he values family deeply. This drives his commitment to helping clients safeguard their futures and pass down legacies.

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