These Annuity Pitfalls can be Bruising
Labels: Annuities, Retirement Planning, Tax Planning
Thick with intricacy well beyond stocks, bonds, and mutual funds, annuities are some of the more vexing financial instruments around. Their guarantees can attract investors from two extremes – those who avoid Wall Street and choose annuities as a safe alternative to CDs, and those reeling from stock market upheaval who want a certain retreat from risk.
First, some basics: An annuity is an investment contract with an insurance company that produces returns in one of two ways. A fixed annuity earns interest like a CD that’s paid and backed by the insurance company, while a variable annuity captures the performance of underlying mutual funds.
Let’s think about the two general ways an annuity can provide returns from a tax standpoint and see if you agree with this astounding conclusion:
0 Comments:
Post a Comment
Subscribe to Post Comments [Atom]
<< Home