Benefits Of Variable Annuities
If you die a person you select as a beneficiary such as your spouse or child will receive the greater of.
Benefits of variable annuities. Most variable annuities have a couple critical featuresthey allow you some degree of investment selection if not total control and they often guarantee your principal though not interest. But they also provide an extra perk. The most attractive and advantageous features of annuitiesfor example lifetime pay-out joint lifetime pay-out and minimum income guaranteesare often optional riders This means increased costs which can easily add to the annuitants already-considerable annual fee burden.
Income received under an annuity option is partially taxable. That means if you happen to die before the payout phase of the annuity begins your beneficiary can still benefit from a guaranteed amount of money. The term variable annuity is not a good place to begin because they are neither entirely variable nor an annuity.
A variable annunity is at its most basic two things. A death benefit is a payment that the insurance company will make to a beneficiary if you die. This article outlines the structure and benefits of variable annuities.
In return for the higher cost investors receive some advantages. Variable annuities provide guaranteed income. Compared to the other annuities fixed or fixed indexed a variable annuity offers the best possible return.
With the other two kinds of annuities your money is not. Variable annuity costs are higher than mutual fund expense ratios. An investment in a diversified fund and a notional protected balance which is formed.
Payments from variable annuities can increase if the portfolio performs well and decrease if it loses money. Benefits of a Variable Annuity. The Costs and Benefits of Variable Annuities.