Ms. Zhang just passed her 50th birthday this month, and she hopes to buy herself an additional supplementary retirement income annuity.

Ms. Zhang hopes that after the age of 65, she can receive $2 in retirement annuity insurance every year as supplementary income for her lifetime.But Ms. Zhang is not sure,How much does she need to investAt the same time, it is also considering whether it is better to deposit annuity insurance or to do other investment and financial management.

To help Ms. Zhang make decisions,American Life Insurance Guide©️CommunityMr. AnnuityThis column explains these three issues.By analyzing the different types of annuity insurance to choose from, the advantages and disadvantages of each option, and the key points of selection, each policyholder can make rational decisions for his or her own supplementary retirement income.

What type of annuity insurance should I buy?
If you start to save an annuity now (50 years old), how much money do you need to save to receive 2 per year after retirement for a lifetime?
If you use this money to do other investment and financial management, and wait until you are 65 to buy a retirement annuity at a time, then how much money is needed to receive 2 per year after retirement?

/ How to buy annuity insurance /

What type of annuity insurance should I buy?

In general, annuity policyholders who invest and manage their retirement income have four preferences.For these four preference choices, the risk level gradually increases.

This sounds rather blunt, and a more direct approach is the above picture. A good picture description is often better than my nagging for a long time. Please see the picture below:

U.S. annuity insurance product types and risks — *©️American annuity insurance product types and risks*

1. Buy fixed-income annuity insurance...

选择fixed incomeAnnuities, especially multi-year guaranteed interest rate (MYGA) annuity insurance, earn annual interest rates between 3% and 6%*(09/2023 Interest Rate Environment), this type of annuity is simple and easy to understand, and it is not for nothing that it is compared to a "super fixed deposit" in the industry.

Take the current annuity market as an example,Guaranteed multi-year fixed incomeThe interest rate has exceeded 5%, which is higher than the bank deposit interest rate in the same period. At the same time, there is no need to declare taxes and pay capital gains tax for the annual interest income.

Based on the market interest rate in September 2023, if you start saving this type of fixed income annuity at the age of 9,Then you need to deposit about $16 in premiums.After the age of 65, you can receive an annual retirement income of 2 yuan.^*

When applying, find out what the current interest rates are for the fixed benefit annuity insurance policy you purchase.Or use our freeUS dollar retirement annuity insurance self-service interest rate quotation toolMake an inquiry.

2. Buy exponential annuity insurance...

If wishNo loss of retirement principal, while pursuing more value-added potential, you can further chooseIndex-income annuity——According to Buffett Barao’s experience, use long-term investment in low-cost passive indexes in exchange for the possibility of value-added.

Usually this type of tracking indexAnnuity insurance, there will definitely be a 0% guarantee,But at the same time there will be an annual yield cap (Cap).Check what you purchasedIndex Annuity InsuranceCap to find out what the maximum benefit cap of the policy is.

According to the current index market environment, the S&P500 of some excellent index annuity productsThe annual capped rate of return is generally around 8%-10%(*09/2023 interest rate environment); Index annuity products dedicated to asset accumulation and appreciation, currentlyCapped rate of returnIt may reach more than 10%, or other index options without caps may be provided.

Index Income Annuity InsuranceThe advantage is obvious - 0% guaranteed growth ensures that the policyholder's retirement funds grow at a steady rate of compound interest.

According to conservative calculations based on market data in the past 10 years, if you start saving for index annuity insurance at the age of 50,Then you need to deposit about $10 in premiums.After the age of 65, you can receive an annual retirement income of 2 yuan.^*

In addition to a one-time deposit,Index Annuity InsuranceIt also provides the option of depositing premiums in installments, such as 5-year or 10-year installments.

3. Buy combined annuity insurance...

If you can go furtherBear the risk of principal loss, policyholders can choose combination annuities to gain greater opportunities for income growth.

Combined annuity insurance is a securities product. This type of annuity provides a higher capped rate of return than an index annuity, but at the same time,It also no longer provides a 0% guarantee, but provides a minimum return rate in the range of -5% ~ -20%,According to the policyholder’s risk tolerance, the lowest rate of return andCapped rate of return.

Because you are buying securities products, the return of portfolio annuity insurance is uncertain, so there is no way to give a reference premium value.

Personally think, rely onproposal(illustration) Does not have much practical meaning to judge, product reputation and actual performance may be more important.Check the minimum yield and cap of the combined annuity insurance you have purchased.

4. Buy fund-type annuity insurance...

If you are a mature investor and are willing to take on more market risks in exchange for higher income potential, then the insurance company issuedFund income annuityIs the next choice.

Fund annuity insuranceIt is a securities product with a relatively more complicated structure.Please read the "Prospectus" carefully before purchasing.investFund annuity insuranceThe profit of is uncertain. When the market falls, the account will bear the corresponding loss, but when the market rises, there is no "Cap yield Cap"Restrictions, will get corresponding benefits.

Because it is buying securities products, soPortfolio Annuity InsuranceThe benefit is impossible to determine, so there is no way to give a reference premium value.

Article summary on buying annuity insurance

Pass 4 kindsAnnuity Insurance TypeIn contrast, Ms. Zhang, the policyholder, learned about the risk ranges, return methods, advantages and disadvantages of different annuity types.Combined with the premium reference value provided, Ms. Zhang can finally make a choice that suits her actual situation.

But if Ms. Zhang chooses to invest in financial management by herself, such as personal retirement accounts, personal investment accounts, etc., to build her own retirement principal,When Ms. Zhang is 65 years old, she will transfer this money into an income-based annuity insurance to provide lifelong income. How much will it cost then?

5. Buy income type annuity insurance

In fact, if you are 65 years old this year,A retirement income annuity that can be guaranteed for life,It may be the focus of the policyholder's attention.Then the several types of annuities introduced above may not be suitable for you.Apply for oneCurrent income annuity insurance.A one-time deposit of USD 29 in premiums(*08/2023 market rate), You can immediately start receiving annual retirement income of $2 per year.(End of full text)

About LifeTank©️ – LBYB
LBYB – Learn Before You Buy, is TheLifeTank.com – American Life Insurance Guide©️Proposed a guiding concept for individuals and families to configure financial insurance.In view of the extremely diversified financial instrument properties of American life insurance and annuity insurance, the application of these products in the field of wealth accumulation and inheritance has surpassed consumer insurance products that consumers can understand in the traditional sense.The lack of corresponding basic knowledge education and the impact of one-sided education may cause harm to your interests after many years.Before applying for an insurance policy, the American Life Insurance Guide©️ encourages consumers and investors to learn and understand the basic operating principles and functions of such financial products in advance, so as to obtain solutions that can truly protect their families and wealth.

*The premium of the annuity depends on the actual market performance and interest rate environment. The figures in this article are only used for estimation and reference for policyholders, and are not or guarantees of return. This is NOT a Guarantee to your annuity investment.

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