Avoid the Common Mistakes of Annuities
Chicago (InsuranceAgents.com) – If you’re looking to not have to worry about your financial situation after you retire, investing in an annuity might be your best chance to do so. Although annuities can reward a person handsomely, they must be taken care of in order to prevent any problems. A recent article published on InsuranceAgents.com warns investors of several common mistakes they must avoid doing if they want their investment to pay off.
In order to benefit from an annuity, an investor must not misunderstand the surrender period. “All annuities have surrender periods, a fixed length of time that the insurance company can penalize you for early withdrawal from annuities, some lasting up to fifteen years,” the article, Annuities: Four Things You Shouldn’t Do, states. “You need to understand the surrender periods before signing anything.”
You should also never turn too much of your hard-earned money over to an annuity. Since it’s sometimes difficult to get your savings out of an annuity if you ever find yourself desperately needing it, you should only invest a portion of it. You can never tell when you’re going to be in desperate need of some money, so it’s always better to be safe than sorry.
Annuities are a complicated concept, and not taking them seriously can really put an investor in a tight bind. “Everyone makes mistakes—we’re only human,” the article describes. “But when it comes to annuities, we have to be extra careful. If we make too many mistakes with annuities, we only hurt ourselves.”
There are many more mistakes investors make while dealing with annuities, so contact a licensed insurance agent to learn about all of them. Hopefully with a bit of guidance, you can avoid falling into traps that others have experienced.
staff contribution: Rafael Onak
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