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Annuity Commuted Value

Annuity Commuted Value

The Normal Kinds Of Income Annuity

If you need an income for a selected amount of time, then you should think about purchasing an income annuity. This might sound simple, but the reality is that there are many different needs, therefore insurance companies offer a wide range of annuities. This article presents the most common variations of annuity.

The most basic offer is the immediate lifetime annuity. It basically means that the owner of the annuity deposits a sum of money, and in return he or she will receive a lifetime income based on that amount. This is the best choice of those who are afraid about their future income. The drawback of this annuity is that no lump sum or income is given to the successors after the owner passes away.

Income annuity for a fixed period or annuity certain means that the payments will be made over a fixed period one selects. The income will stop when all payments are paid out. If the owner of this type of annuity passes away before all the money is paid, the remaining money will be received by someone the owner wishes. This is best for those who want to pay a mortgage.

A cash refund annuity means that if the owner passes away, the deposit is refunded. For example if someone decides to purchase a $500,000 annuity and starts to receive the payments, but dies before he gets the entire amount, the rest is paid to a third person, according to the owner’s wishes. This kind of annuity is best for seniors who have people depending on him.

The joint or survivor income, or joint income annuity are very similar: each pays based on two covered persons. The only difference is the length of the payout, and the amount. If someone wants higher payments, a joint annuity might work better, but it stops as the covered individual passes away. The joint and the survivor income will pay as long as the person covered lives. This is a choice for couples who are both dependent on the annuity income.

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