The different kinds of annuities have not just one, but a variety of features that make them different. Here are some of them. Keep in mind that each annuity will have a combination of these differing features.
1) Immediate vs Deferred. Immediate annuities are often single premium annuities and they begin making payments to the beneficiary almost immediately. Deferred annuities are often paid periodically, although they can also be paid in a single premium. Deferred annuities are not annuitized until after an extended accumulation period.
2) Single Premium or Multiple Premium.
3) Fixed, Indexed, or Variable. Fixed annuities have a guaranteed minimum interest rate that is paid on the premium paid for the annuity. Indexed annuities have a base interest rate but can perform above that through the use of market indexes. Variable annuities are invested in the stock or other markets and may or may not have guarantees.
.JPG){kind=avatar}
1) Immediate vs Deferred. Immediate annuities are often single premium annuities and they begin making payments to the beneficiary almost immediately. Deferred annuities are often paid periodically, although they can also be paid in a single premium. Deferred annuities are not annuitized until after an extended accumulation period.
2) Single Premium or Multiple Premium.
3) Fixed, Indexed, or Variable. Fixed annuities have a guaranteed minimum interest rate that is paid on the premium paid for the annuity. Indexed annuities have a base interest rate but can perform above that through the use of market indexes. Variable annuities are invested in the stock or other markets and may or may not have guarantees.