Last Updated on Feb 18, 2020 by James W
In the last few years, people have shown interest in annuity plans to secure their retirement life. The different types of annuity schemes provide firm ground to build your future. The insurance companies have flooded the market with profitable schemes which guarantee a steady monthly retirement income to the elder people. The schemes promise to bring fixed benefits but it’s your own decision to select the appropriate scheme for yourself. The monetary benefits of various schemes generally depend on the annuity rate. The annuity rates very much effective in determining the amount of money which will be provided to you.
What is annuity rate?
The annuity rates are actually the rate of return on your investment. The rate varies on the basis of different annuity schemes. The annuitants generally dream of getting the best possible return on their annuity. The rate of return depends on the market interest rate and the economic policy of the government. Before knowing the different annuity rate one needs to understand the different types of annuities. There are three types of annuities of which the first two are randomly preferred by most of the people.
Fixed Annuity
This type is easy to understand. The fixed annuities offer a steady rate of return over the insured period of years. The rate of return does not depend on the market fluctuations and after a certain period of time you can easily remove your investment. The investment in fixed annuity is risk free.
Variable Annuity
The variable annuity provides your investment the opportunity to grow with the market interest rate. In this scheme the rate of return depends on the market fluctuations. This scheme is designed for long time purpose. The longer you keep your investment, the more it will flourish.
How would you know the annuity rates?
- You can ask the insurance agencies to send their representatives to guide you about a certain annuity rate of any annuity scheme. Try to find out the terms and conditions of the particular annuity scheme.
- Compare the different annuities from numerous annuity providers. Also compare the rates of similar annuity plans.
- Look for the variable contracts for the fixed rates as well. Sometimes variable annuities provide the option of a fixed account which pays a guaranteed rate.
- The best way to know the different annuity rates is to use the online annuity calculators. The calculators help to calculate the different rates and bring the best annuity option to you.
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