Can I Achieve My Financial Goals With An Annuity Plan?

It is not possible that you are thinking about financial goals, and the thought of investing in annuity plans doesn't strike you even once. Annuity plans are one of the best schemes when it comes to investing in a life insurance company. They secure the future of the individuals and give them a more trustworthy source to rely on.

Are you also planning for your retirement? Want to set a better financial goal for yourself? Then investing in annuity plans is the best deal for you. Keep reading to learn all about what is annuity and what its benefits are.

Annuity Plan Features and Benefits

Following are some of the features and benefits of annuity plan:

1. Steady Income Provider

An annuity policy is basically a contract between you and your life insurer. In this policy, you will invest a lump sum amount of money during your working years, and in return, life insurance companies will provide you a steady amount every month in your retirement years. Although this plan is beneficial for everyone, it especially helps the small-business owners who don't get huge revenues from their business. They can invest monthly in this scheme and, in return, can ensure a secure future for them.

2. Protection from Inflation

First off, you should know what inflation is. Inflation is the decline in the power of money due to a constant increase in the prices of commodities, services, and goods of an economy. 

Most of the annuity plans given by the insurance company make sure that the money that you have invested doesn't suffer from inflation. The plans are designed by taking the economy of the country into consideration and possess resistance to inflation. This makes annuity plans one of the best investment options for all individuals. 

3. Guaranteed Payout

One thing best about this plan is that nothing happens to the principal amount. It stays protected during the whole period of time in annuity plans. This means that whatever money you will get in return at the end will always be more than the principal amount you invested. So, even when the worst of the worst circumstances come, you will at least get your invested money back completely. This gives a sense of security to all individuals.

4. No Tax

You don't have to pay any taxes for the money you have invested in an annuity plan, which means that by investing in this life insurance scheme, you will not only get protection from inflation, but you will also have an exemption from paying tax. 

But one thing you should take into consideration is that once you start withdrawing money from your account, the tax charges will start applying to it. On top of that, if you are withdrawing the money before the age of 59, then you will be charged 10% of the tax. Although, make sure to learn in complete detail about all of these features with your life insurer before you sign the contract.

5. After Death Benefits

If, in some unfortunate event, you die before you had the chance to withdraw your money, annuity plans have schemes for that too. It provides a bunch of options that you can choose to ensure steady income from the insurance company even when you die. Your close ones will still be able to benefit from your hard-earned money. So, before signing the contract, make sure that your annuity plan has clauses for after-death beneficiaries also included.

6. You Can Invest As Much As You Want

There is no limit to how much money you can put into an annuity plan. You can stuff your account, and all that money will stay protected from inflation and tax charges until you start withdrawing. And there are also no rules that say that it is mandatory for the investors to start withdrawing money after the age of 72. If you don't want to withdraw the money and want to leave it for your loved ones after you die, you can just leave it there.

Endnotes

An annuity plan is a pension plan that every individual looking for a secure future invests in. It is a high-return investment plan that helps you get the quality life you have always dreamt of after retirement. In return for the lump sum amount given by the investor, this plan provides steady monthly income to the individuals. The principal amount given by the investor stays protected from tax services and inflation during the whole time. The plan also provides the highest liquidity to its investors; that is, you can take your money out whenever you want. All in all, it is the best option for you to include in your list of plans to achieve your financial goals.

Also Read: The Importance Of A Savings Plan For A Secure Future!

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