Why do people buy annuities?

Annuities can provide a guaranteed* income stream for a specified period or the lifetime of the annuitant, ensuring financial stability in retirement.

* All guarantees are subject to the claims paying ability of the insurer

Earnings from interest within an annuity grow tax-deferred until withdrawn, allowing for potentially higher returns over time.

Annuities can be a valuable component of a diversified retirement portfolio, providing a reliable source of income in addition to social security, pensions, or other retirement savings.

Certain types of annuities, such as fixed and fixed-indexed annuities, offer principal protection, ensuring that the initial investment is not lost due to market fluctuations.

Annuities help manage the risk of outliving one's savings by providing a lifetime income stream.

Some annuities offer options to increase payments over time, helping mitigate inflation's effects on purchasing power.

Annuities can be structured to include beneficiary designations, allowing for the transfer of wealth to beneficiaries tax-efficiently.

In some jurisdictions, annuities may be protected from creditors, providing additional financial security.

Fixed annuities offer a guaranteed rate of return, allowing for more predictable income and easier budgeting.

Fixed indexed annuities offer potential for increase in interest rate credited by a determined market index, while providing protection against negative performance.

Adding an annuity to an investment portfolio can provide diversification and help reduce overall risk.

Some annuities offer liquidity options, such as penalty-free withdrawals or surrender charges that decrease over time, allowing access to funds if needed.

Certain annuities, such as those with guaranteed* death benefits, can be used as wealth transfer tools to support beneficiaries financially.

* All guarantees are subject to the claims paying ability of the insurer

Certain annuities can be part of Medicaid planning strategies to help protect assets and qualify for long-term care benefits.

Annuities can be structured to fund long-term care expenses, such as home health care or assisted living.