Annuities are a smart choice for ensuring a steady income stream during retirement. At Cauldron Insurance Agency, we offer various annuity products, including fixed, variable, and indexed annuities. Our knowledgeable agents will help you understand the benefits and select the right annuity to provide financial stability and peace of mind in your retirement years.
An annuity is a financial product offered by insurance companies that provides a steady stream of income, typically for retirement. You invest a lump sum or series of payments, and in return, the insurer makes periodic payments to you starting either immediately or at a future date.
The main types of annuities are fixed annuities, variable annuities, and indexed annuities. Fixed annuities provide guaranteed payments, variable annuities' payments fluctuate based on investment performance, and indexed annuities offer returns based on a stock market index.
Annuities offer several benefits, including tax-deferred growth, a guaranteed income stream, and protection against outliving your savings. They can be a valuable tool for ensuring financial security in retirement.
The money you invest in an annuity grows tax-deferred until you start receiving payments. When you withdraw funds, the earnings portion of your payments is subject to ordinary income tax. If you withdraw money before age 59½, you may also incur a 10% early withdrawal penalty.
Before purchasing an annuity, consider factors such as your financial goals, risk tolerance, the types of annuities available, fees and charges, the financial strength of the insurance company, and the specific terms and conditions of the annuity contract.
