Surrender Annuities And Face The Consequences
Chances are consumers are aware of the risk when purchasing annuities in the first place. However, circumstances arise and situations change, leading consumers to bail on investments. But at what cost? Many people surrender annuities not knowing that they will be forced to pay a price, according to an article recently published on InsuranceAgents.com
The article, titled ‘Consequences of Surrendering Your Annuity,’ states that investors might want to reconsider surrendering annuities. “With annuities being such complex and grand investments, there are many reasons as to why owners surrender annuities,” the article states. “The most popular reason why owners surrender annuities is because their financial situations have changed and they can no longer afford the annuity.”
If the decision to surrender an annuity has to do with the desire to combine several annuities, then investors may want to weigh the pros and cons to decide which scenario better suits them financially. However, investors who purchased annuities without fully knowing the risk should contact an insurance agent or financial professional immediately to try and salvage the situation.
In order to give a better idea of what consequences consumers face by surrendering annuities, here is a basic overview. Those under the age of 60 most likely will be forced to forfeit a 10 percent penalty on the taxable portion of the annuity. Those over 60 will most likely be charged a surrender fee with the least amount of time into the annuity, meaning the more expensive that fee will be.
It is always in an investor’s best interest to follow through with the investment. However, unforeseen events could arise and push consumers to want or need to surrender their annuities. Talk to an expert about options regarding surrender annuities, or visit InsuranceAgents.com for more information.
Staff contribution: Kyle Fitzsimmons
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