Learn About the Three Types Of Annuities

When people become old enough for work, they retire. It would only be good if old people could enjoy the last years of their lives while not being pressured to make a living for themselves. By the time they become old, they might have probably saved a huge amount of money which is good for the rest of their lives. Nevertheless, it would still be great if they could continue receiving money even without having the need to work. This is where retirement income comes into the picture.

Today, there are numerous retirement income options to choose from. For example, there is the guaranteed life insurance. Another one of those options is annuity. Annuity is a special type of retirement income option wherein an investor regularly pays money for a particular period and then start receiving money at some point in the future. There are actually three types of annuities to choose from. Here are those three types:

Life annuity

First, there is the life annuity. This special type of annuity is the most common. People will receive money from a set period of time until the day they die. Therefore, the longer a person lives, the higher the amount he could get from the insurance company. This type of annuity is available in almost every insurance company.

Joint annuity

Obviously, this type of annuity is for two individuals. Two individuals will receive income payments for as long as they live. Even if one of them dies, the other will still continue receiving income payments. This type of annuity is ideal for couples. So if, for example, a husband dies, his wife will still enjoy the benefits of income payments even if the breadwinner of the family has passed away. Joint annuities are not only ideal for spouses. They are also ideal for any two family members. For instance, a father and his son could go for a joint annuity.

Annuity certain

Finally, there is the annuity certain. Death is not really a factor in this type of annuity. There will be a fixed certain amount of money that the insured person is entitled to receive. He will receive this amount for as long as he is living. If in case he dies the money that is entitled to him will be given to someone that he has appointed. Usually that secondary beneficiary is the spouse or another family member.

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