Tell Me About Fixed Annuity Products

Fixed annuity also referred as a tax-deferred fixed annuity, is basically a contract between you and an insurance company for a guaranteed interest. It offers numerous options for determining guaranteed income duration as well. The insurance company in this case credits interest on your fixed annuity, but you don't have to pay taxes on the earnings until you make a withdrawal or begin receiving an income from your fixed annuity.

Fixed annuity earns competitive returns and it is also very safe. Furthermore because a fixed annuity is tax-deferred, you earn additional interest on your investment as well. Fixed annuity is also seen as one of the best investment option available for a investor who may be uncomfortable with risking his/her deposit in the stock market.

Type of fixed annuity product:-

• Traditional Fixed Annuities:- If you purchase this annuity then your insurance company will reset the interest rate every year on the anniversary of your initial deposit. This rate will never be set lower than the company's minimum rate guarantee that generally varies between 1.5% to 3%.

• Equity-indexed annuity:-Equity-indexed annuities are one of the most famous types of annuity among the various options available. A guaranteed minimum return is ensured in it, if one agrees to compromise and fix a maximum rate of return. In another words one can ensure a minimum rate of return if one is willing to limit the maximum possible return that one will be entitled to receive in future.

• Immediate Annuities:- Immediate annuity is sometimes referred to as a fixed annuity but it is a very different from the deferred fixed annuity. It will start making secure, guaranteed payments to you right away. An immediate annuity might be the best investment option for you if you are near retirement and/or wish to turn your 401K, IRA, or sale of a home into a secure, guaranteed income stream.