Sorting Out the Types of Deferred Annuity

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<h1>Sorting Out the Types of Deferred Annuity</h1><strong> Author: <a href='http://www.articleseen.com/profile_Robert Maddy Cooks.aspx'>Robert Maddy Cooks</a></strong><br /><p>Retiring from your professional responsibilities, undoubtedly, give you the chance to relax and be free for sometimes. But along with relaxation, it gives you many tensions related to finance. After retirement, an old individual has to think of how to lead his further life comfortably without any financial hurdles. The pension amount is not enough to meet the essential needs and requirements of the retirees. This is where deferred annuity comes into focus. With the help of the deferred annuity, the individuals get a chance to earn for life based on whatever they spend for buying their desirable annuity scheme. The scheme of deferred annuity has two phases – savings phase and the income phase. In the former phase, the individuals save money throughout his service life to protect his future financial crisis. When the savings is made in the deferred annuity account, they are free to avail the benefits of the scheme by entering the phase of income. The money that the individuals save comes back to them as their own income. In case of the deferred annuity, however, the retirees have an option of postponing the withdrawal of the money from their account till they desire. As a result, the payment of interest also gets deferred to the time period when the annuitant begins to receive the saved amount. When it comes to deferred annuities, there are three different types of schemes that are available to the individuals. They have been mentioned below: Fixed annuity: The rate of interest that the annuitant gets on the amount remains fixed throughout the period of the receipt of the amount. As a result, there is no fluctuation in the fixed annuity amount that you receive, which makes it one of the most reliable options. Variable annuity: The rate of interest, unlike fixed schemes, fluctuates in this case. The investment is driven by the investment of the annuitant in the stock market. This makes the deferred annuity quite a risky option. However, like the above scheme, this amount too can be received for lifetime. Equity Index annuity: The amount to be received in this case completely depends upon the interest based on the stock market that is figured out by tracking one of the major stock indexes in the market. But the most vital thing that makes it a relevant option is that the scheme protects the principal amount and does not go down in value. In fact, additional benefits are ensured when the stock value rises.</p><strong>About the Author:</strong><br />Robert Cook is a financial consultant who has good information on <a rel="nofollow" href="http://www.immediateannuities.com/">fixed annuity</a> and <a rel="nofollow" href="http://www.immediateannuities.com/content_pages/lesson.htm">deferred annuity</a>. For more information he recommended you to visit <a rel="nofollow" href="http://www.immediateannuities.com/">http://www.immediateannuities.com/</a>.<p> Article Source: <a href='http://www.articleseen.com/Article_Sorting-Out-the-Types-of-Deferred-Annuity_104463.aspx'> http://www.articleseen.com/Article_Sorting Out the Types of Deferred Annuity_104463.aspx</a></p>

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Keywords : fixed annuity, deferred annuity,

Category : Finance : Investing