• Home
  • E-Booklets
  • Pay Less Tax
  • Privacy Policy
  • Cheatsheets
  • Contact Us
  • About us

Retirement Income

New Ways to Get More Retirement Income

  • Retirement Advisors
  • Retirement Insurance
  • Retirement Investing
  • Retirement Living
  • Retirement Planning

Fixed Annuities: Renewal time dilemma

Posted on September 27, 2011 by bobrichards

hen fixed annuities come up for renewal,at the end of the term, you have a decision to make. Thankfully, you'll have several options as we explained in this post.

Fixed annuities obtained a few years ago could be supplying lower renewal rates than the annuity rates you desired when you first made your investment. to keep your annuity with the same company, you generally have three choices:

a) renew your annuity for the same term at whatever rate the insurance company offers

b) take the one-year rate offered by the company and then see where rates are in one year to decide what to do

c) leave the annuity is an open account at a very low rate but have the flexibility to close it out at any time if you choose

d) annuitize the annuity and begin receiving regular payments

The opposite alternative would be transferring the particular annuity and choosing another insurance annuity to try and find another long-term, locked-in rate guarantee.

From a long-term perspective, a one-year annuity rate lock might not be a bad option. Besides, just about all fixed annuities offer this option. While getting a reasonable return, agreed less than what you expected, you may choose to take your decision next year, in lieu of opting for another annuity company or another annuity with different annuity rates.

You could also secure a fixed annuity which that offers a multi-year rate guarantee.  Note all companies offer these. With such annuities, the rate is guaranteed not to change for a period that extends via between 5-10 years. These annuity rates could possibly be offered to you by the annuity company in order to retain your business. when renewing your annuity or choosing a new contract, of course, a new set of surrender charges will apply. Annuities surrender charge schedules and rates vary from one annuity company to another.

Fixed annuities have been created for long-term investors. Within these type of annuities, the regular federal income taxes apply to interest withdrawals and the 10% tax penalty applies in case withdrawals before the age of 59½. Note that no tax or penalties apply when simply moving the funds in an annuity to the annuity of another company.  because virtually every annuity has surrender charges, it's best not to move an annuity from one company to another during the term but rather wait till the end of the term.

Before switching to a new company for a fixed annuity, check the renewal rate history. If the agent or company dragged its feet in supplying this information, choose another company.

if you do business with an independent annuity agent, he can shop for you among many different companies to find you the better offers as to rate and terms on fixed annuities. Note that if you deal with a captive agent who only works for one company you may not see a selection of what's on the market.

 

Most Annuity Owners Make This Mistake

To get wealthy, invest like the wealthy
  • Why the wealthy steer clear of mutual funds
  • How the rich systematically make money in the market
  • Key metrics that differentiate good and bad investments
  • A comparison of ETFs and separately managed accounts you have never seen
  • Stop making the same investing mistakes as everyone else who listens to CNBC and reads Money Magazine. Do what the rich do! Free guide explains how they think and make investment choices.

    You might also like:

    • Retired and Stocks Losing Value
      Retired and Stocks Losing Value
    • Recession Can Be Good for Retirees - The Silver Lining of Recession
      Recession Can Be Good for Retirees - The Silver Lining of…
    • How to Pay Lower Taxes on IRA Distributions
      How to Pay Lower Taxes on IRA Distributions
    • Bear Market - When Will It End?
      Bear Market - When Will It End?
    • When Will the Stock Market Recover
      When Will the Stock Market Recover

    Filed Under: Annuities for Income

    About bobrichards

    Bob Richards
    Editor | Involved in Various Marketing Positions within the Financial Services Industry

    Leave a Reply Cancel reply

    Your email address will not be published. Required fields are marked *

    Second place winner best retirement blog

    SH award winner SMALL (1)

    Not Enough Savings to Retire?
    Learn Six Ways to Earn Retirement Income (from home)

    You do not need special talents, skills, computer knowledge, etc. We show you multiple ways others are working a few hours a week to generate a comfortable retirement income.

    Download Free Copy

    Latest Posts

    Recession Can Be Good for Retirees - The Silver Lining of Recession

    Recession Can Be Good for Retirees - The Silver Lining of Recession

    Bear Market - When Will It End?

    Bear Market - When Will It End?

    When Will the Stock Market Recover

    When Will the Stock Market Recover

    How to Pay Lower Taxes on IRA Distributions

    How to Pay Lower Taxes on IRA Distributions

    Retired and Stocks Losing Value

    Retired and Stocks Losing Value

    Categories

    • 401K IRA Roth Withdrawals, Distributions, and Rollovers
    • Annuities for Income
    • Estate Planning
    • Retirement Advisors
    • Retirement Insurance
    • Retirement Investing
    • Retirement Living
    • Retirement Planning
    • Social Security
    • Supplemental Retirement Income
    • Tax Savings
    • Alternative Investments
    • E-Booklets
    • Pay Less Tax
    • Privacy Policy
    • Cheatsheets
    • Contact Us
    • Subscribe
    • Sitemap

    Recent Posts

    • Recession Can Be Good for Retirees - The Silver Lining of Recession
    • Bear Market - When Will It End?
    • When Will the Stock Market Recover
    • How to Pay Lower Taxes on IRA Distributions
    • Retired and Stocks Losing Value

    The Retirement Income Blog

    25A Crescent Drive #1508
    Pleasant Hill CA 94523
    T: 844-887-4131
    E: [email protected]

    © 2018 Retirement Income