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Shopping for an Annuity

BeamaLife compares top 100 US life insurance company to find best, cheap and most affordable term, whole and universal life insurance quotes and rates. http://www.beamalife.com

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Shopping for an Annuity

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  1. Shopping for an Annuity www.BeamaLife.com | 1-866-972-3262

  2. Shopping for an Annuity • Shopping for an Annuity • Although many insurance companies offer annuities with the same (or at least similar) features, that doesn't mean that all products and all companies are the same. As with all financial products, you should shop around and compare. Here are some things to consider when shopping for annuities. www.BeamaLife.com | 1-866-972-3262

  3. Shopping for an Annuity • Financial stability • Moody's, Standard & Poor's, and A. M. Best all rate insurance companies for financial stability and customer satisfaction. When purchasing an annuity, it is best to consider buying only from companies that have received high ratings from each of these services. www.BeamaLife.com | 1-866-972-3262

  4. Shopping for an Annuity • f you're buying a variable annuity (as opposed to a fixed annuity), you can be less concerned about the financial stability of the issuing company, because assets held in the subaccounts of a variable annuity are not subject to the claims of the creditors of the issuing annuity company. www.BeamaLife.com | 1-866-972-3262

  5. Shopping for an Annuity • Get the best performer • When shopping around for a fixed annuity, the one offering the highest initial interest rate is not necessarily the best value. • Often, companies will offer a very high initial rate, guaranteed for one or more years, as a way to induce a sale. After the guarantee period ends, the rate drops steeply. www.BeamaLife.com | 1-866-972-3262

  6. Shopping for an Annuity • Ask the issuers to provide the historical returns for their annuities that they have paid over the last 10 to 20 years. Those returns are a better indicator of what to expect in the future from that company. • Also, check the guaranteed minimum interest rate. Although 3 to 4 percent is common in today's market, you may be able to find a company that offers an annuity with a higher minimum rate guarantee. www.BeamaLife.com | 1-866-972-3262

  7. Shopping for an Annuity • Compare fees • Annuity products in general, and variable annuities in particular, have a number of fees structured into the product. These fees can vary greatly from sponsor to sponsor and from product to product. www.BeamaLife.com | 1-866-972-3262

  8. Shopping for an Annuity • Higher fees can offset a higher rate of return if the fees are significant enough. Therefore, the smart consumer factors the amount of fees that will be deducted from the investment return before making a final decision. www.BeamaLife.com | 1-866-972-3262

  9. Shopping for an Annuity • Watch out for surrender charges • It's common for annuities to have contingent deferred sales charges, commonly known as surrender charges, that are assessed when you surrender some or all of the annuity within a certain number of years after purchasing the annuity. Typically, the surrender charge will begin at about 7 percent and decrease by 1 percent annually. www.BeamaLife.com | 1-866-972-3262

  10. Shopping for an Annuity • Ideally, your surrender charge is not longer than the interest rate guarantee on a fixed annuity. If it's not, and the insurance company drastically reduced the interest rate it is paying, you may find yourself with the choice of keeping the annuity and earning a low rate, or surrendering it and paying a surrender charge. www.BeamaLife.com | 1-866-972-3262

  11. Shopping for an Annuity • Many variable annuities can be purchased without a surrender charge. However, you can expect to pay slightly higher annual fees when buying these annuities. www.BeamaLife.com | 1-866-972-3262

  12. Shopping for an Annuity • Do your homework • Many resources are available that allow customers to compare products and features. Several websites, for example, list competing products and features. Also, several publications that you might find in your local library offer this information, usually updated on a monthly basis. www.BeamaLife.com | 1-866-972-3262

  13. Shopping for an Annuity • Since you will have to purchase your annuity through a licensed broker in any event, you may want to consult your investment advisor, stockbroker, or insurance professional to see what they can offer. www.BeamaLife.com | 1-866-972-3262

  14. Shopping for an Annuity www.BeamaLife.com | 1-866-972-3262

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