​Immediate annuities are good retirement plansBlog added by Robert Eldridge on September 1, 2011
AnnuityCampus.com

Robert Eldridge

Las Vegas, NV

Joined: August 18, 2011

An immediate annuity, or financial allowance plan, which offers flexibility and security, could be the answer for a person's income requirements. People who are looking for a simple and manageable method to maintain their retirement income can set up one an account quickly and easily.

Many people are afraid of outliving their assets, and well they should be, because people are living longer due to the advancement of medical science. Humankind needs to thank medical science because men and women are living longer, but people need to make financial provisions for their longer life span.

This is why it is important to start planning today for retirement. The optimal way to plan is to invest in an account that will pay benefits for the life of the plan holder. Many financial planners suggest that their clients pay into a retirement plan that will not only pay benefits throughout the life of the plan holder, but also have benefit payments that never fluctuate.

The way the financial allowance plan works is that one contributes a lump sum to the account. The plan holder then receives monthly income, based on his age and amount of funds in the account. The allowance income is determined by life expectancy and can be paid out over a fixed period. In other words the beneficiary chooses how many years he wants to receive the payments. This is one of the more popular ways to set up the account payments.

Some beneficiaries choose the fixed amount plan option and determine the payment amount that will be paid out each pay period. It is up to the beneficiary to calculate how long the payments will last so that the account will be funded throughout the beneficiary's lifetime. Some beneficiaries like this option because it gives them more control over their account.

With the life option plan the beneficiary will receive payments for the rest of his life, but there is a risk when choosing this option because the beneficiary might pass away before the full value of the account is paid. The money in the account returns to the insurance company when the beneficiary passes. But some people like the certainty of always having an income even if it means losing some of the money at death.

There is another option, which is called the period certain life option plan, which will make payments to the beneficiary of the plan holder for a certain amount of time if the plan holder dies. Usually, the plan specifies the age the plan holder must die before his beneficiary can receive payments.

This refers back to the issue of life expectancy. The day to start planning for retirement is today, if not sooner, because many people who retire find out that they do not have enough money to live. An immediate annuity is a good way to plan for retirement because it provides payments for life, depending on the payment plan one chooses. There are many types of plans available to fit an individual's own financial situation and financial needs of the future.

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