An annuity is a type of investment that sometimes involves making a deal with insurance for different benefits. One of the most common examples of an annuity is retirement benefits. Other annuity examples include insurance payments in exchange for benefits and pension payments. If you find yourself falling into bankruptcy, feel free to ask a Chattanooga bankruptcy attorney for help.

Why Annuities Might Be Important for You

Annuities are helpful because when you make the right deal, you could receive income for the rest of your life or for a certain length of time. You may be interested in investing in annuities when you are in need of long-term financial growth. This is why many people use annuities for retirement purposes.

The way most annuities start is through a contract with an insurance company. You agree to either make a lump-sum payment or smaller periodic payments for a certain period of time. Your payments will, in turn, give you access to income during or later on in this process.

Different people have different reasons for investing in annuities depending on their life circumstances. Some people use annuities for retirement savings while others find annuities helpful for leaving something for their beneficiaries. Annuities can also help cover the costs of healthcare after retiring from work.

What is an Annuity and What Type Should I Choose?

The benefit of investing in annuities is that the insurance company is at market risk rather than yourself. This means that you should be able to outlive the money you earn from your annuity.

Which Type of Annuity Should I Choose?

There are three types of annuities out there to choose from. Choosing carefully is vital for your financial future. Fixed annuities involve a deal where insurance pays you no less than the interest rate you started with. You start receiving payments when your account begins to grow.

A variable annuity means you can choose different investment options but with different payment returns. Depending on what you choose, you may be paid more or less than a typical fixed annuity. When it comes to indexed annuities, they use elements of fixed and variable annuities.

This means you are guaranteed a minimal payment, but this payment may increase depending on the market index. You might be able to choose more than one index depending on your plan. These are less risky than variable annuities with the potential to earn more money.

When deciding which type of annuity you want, there are certain things to consider. The complexity of indexed annuities might make you choose the wrong plan. Finding out how your unique indexed annuity will be calculated might be in your best interest. Consider seeking help from a financial advisor before making a final decision.

Bankruptcy Attorney in Chattanooga, TN

Trying to escape bankruptcy on your own can be exhausting and may not always lead to the best decisions available. Contact us at Tom Bible Law by dialing (423) 424-3116 to explore your financial options. Our experienced team of Tennessee bankruptcy lawyers might be able to help you escape your financial situation. You can find us located in the Tennessee cities of Chattanooga, Kingsport, and Tullahoma.