Most annuity buyers purchase an annuity from those who are selling annuity products to help fund their retirement.  It is no longer sufficient to rely on Social Security and company pensions (which are few and far between these days) to provide you with enough income once you retire.  The best way to ensure that your retirement needs will be covered is to supplement social security and any employer provided benefits with savings and investments of your own such as contributing to a 401(k), 403(b) or other type of retirement plan at work, setting up an IRA, investing in mutual funds, stocks and bonds, or purchasing an annuity.

Many people who are trying to save for retirement are attracted to annuities because they offer a steady stream of income once you retire.  Annuities are usually purchased by an annuity payment buyer, who buys an annuity like a structured settlement annuity or fixed rate annuities from an insurance or other form of investment company.  In exchange for a lump sum, or through making regular payments, the owner of an annuity will receive fixed or variable payments either immediately or sometime in the future which can be used to help supplement retirement or other income needs.  That’s annuities explained in a nutshell.

Individuals who have received lump sums from settlements or the sale of a home or business may also want to become the buyer of annuity.  In exchange for the lump sum, the money will be invested on a tax deferred basis, and the annuities buyers will receive regular payments either immediately or at some specified time in the future.

Before you become an annuity buyer you should be sure to find a good annuity buyers guide which will explain to you the different types of annuities and what your options are.  There are different types of annuities with various tax and financial consequences, especially if annuity loans are ever taken out for any reason.  The subject can be complex so you need to be sure you are informed before becoming an annuity buyer.  You may also want to speak with a financial advisor to make this is the best form of investment for your retirement and investment needs, and learn how to find the best annuity rates available.

What if you already own an annuity and want to sell it?  If you are in need of cash and don’t want to pay the penalties of withdrawing money from your annuity early there are also annuity buyers who are willing to purchase your annuity from you.  This will give you the cash you need, and the buyer will have an investment that gives them an income stream.