When it comes time to invest in your retirement, you become an annuity buyer.  An annuity, such as a structured settlement annuity, a variable annuity or fixed rate annuities, is an investment of money for a period of time.  It means that you put aside money and allow it to collect interest.  Someday, your annuity will be liquidated, which will provide you an income for a period of time or for the remainder of your life.  Depending on how much you invest, the financial institution, and the percentage rate, annuity buyers can make a lot of money tax free.  It is different than a CD or certificate of deposit.  Mainly, at this difference lies in the fact that you can get tax benefits because you are putting it away for your retirement.  It is also different because many annuities can be liquidated without penalty.  However, this depends on the financial institution and the fine print.

Overall, annuities are very lucrative for senior citizens so I would definitely recommend buying them from people who are selling annuities.  It is a very effective way to plan for retirement.  The best age to buy an annuity is 55.  Many financial institutions started expect an annuity payment buyer at this age.  In fact, many banks market to their current customers around this time.  You may have less information offered to you if you decide to start an annuity plan before that age.  If you ask the bank manager, they will offer you an annuity buyers guide.  This guide will inform you about the ratios and timelines they expect you to follow.  For example, if you are investing $10,000 for five years they may offer you 3% interest.  However, if you invest $10,000 for 10 years, they may offer you 10% interest.  All of these variables can be discussed with a bank manager, as you’ll be looking for the best annuity rates you can find.

One option that an annuities buyer might not be aware of is the option to receive monthly payments from the annuity.  Most people have it in their minds that they will put this money aside and never see any of it until the future.  However, if you receive a very large inheritance, one of the best things that you can do is to put the money into an annuity.  That way, you can keep your initial amount of money and receive payments every month from the bank based on your interest.  The bank is able to do this if they know that they can keep your money for an extended period of time.  For example, in order to get a higher rate of interest, you can sign a contract saying they you will not liquidate your annuity under any circumstances for 10 years.  If you were to liquidate this asset, then you would pay back all of the interest out of that annuity.  Make sure you have the kinds of annuities explained and annuity rules by an investment professional, so you can make the best decision.

For example, if you received a monthly check of $1000 from your annuity interest and, at the end of the year, you liquidated it, then you would have to pay $12000 out of your annuity fund.  Of course, this is not every company.  Different companies operate with different contracts.  Some will have a standard contract for the buyer of annuity and others will make the contract according to your terms.  If you are dealing with more than $50,000, you may want to talk to an investment specialist.  For example, they may tell you that you should not put all of your eggs in one basket.  If you have a large amount of money, they may suggest that you go with many different companies instead of just one.  Retiring comfortably is extremely important and so it pays to invest money into hiring a specialist to help you handle the special circumstances.  Make sure you know all of your financial options – ranging from liquidation to annuity loans when dealing with buying annuities.