Seniors and elders who are thinking about purchasing an annuity should first familiarize themselves with what an annuity is and the risks associated with annuities. Annuities are not right for everyone. Read the following for more information on what are annuities, what types of annuities there are, and whether purchasing an annuity is the right decision to make.
An annuity is a type of investment. There are fixed annuities, variable annuities, immediate annuities, deferred annuities, etc. Fixed annuities have a fixed minimum rate of interest and fixed minimum periodic payments. Variable annuities change with the market and may be made up with many different types of investments. The investments are usually described in a prospectus that should be provided to interested seniors. Seniors and elders should make sure they thoroughly understand the contents of the prospectus, its terms and conditions, and the risks accompanying each investment.
Immediate annuities require payments to start immediately whereas deferred annuities allow payments to begin at a later date, after a deferral period. If a senior or elder with a deferred annuity wishes to access his/her money before the deferral period is over, they will have to pay a large surrender charge in order to access their money. With any annuity, deferred or immediate, variable or fixed, seniors should find out what potential immediate and future consequences there are. Is there a surrender charge? How much is the surrender charge? How long is the deferral period? Is the deferral period too long? Some insurance companies have deferral periods that last over 15 years – longer than the remaining lifespan of many senior citizens.
Other things to be wary about are the sellers themselves, high surrender charges, no actual tax advantage, urging to switch annuities that may require extra fees and changed benefits, bonuses that result in increased fees and costs, and unaffordable investments or annuities that will prevent an elder from accessing his or her money such as deferred annuities.
Some annuity sellers may try to pressure seniors purchasing an annuity, impose time limits, refuse to answer questions, or other behavior designed to mislead seniors and elders into purchasing an annuity that may not be right for them. Seniors and elders should be on guard against such sellers. Before settling on an agent, seniors and elders should consult with trusted friends and family for help and advice on finding a trustworthy agent.
Annuities are sold through some of the following well-known insurance companies and banks: Massachusetts Mutual Life Insurance Company, Principal Life Insurance Company, Jackson National Life, Pacific Life Insurance Company, Aviva Life and Annuity Company, Athene Annuity & Life Assurance Company, Genworth Life Insurance Company, Midland National Life Insurance Company, Bankers Life and Casualty Co, North American Company for L&H Ins, Security Benefit Life Insurance Company, EquiTrust Life Insurance Company, and Guggenheim Life and Annuity.
If you have purchased an annuity and would like a free and confidential legal evaluation of your policy, contact The Evans Law Firm, Inc. at 415-441-8669 or email email@example.com. The Evans Law Firm, Inc. handles annuity fraud, insurance fraud, banking fraud, consumer class action fraud, financial and physical elder abuse, and whistleblower/false claims litigation.