VARİABLE ANNUİTİES

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“Variable annuities”: are long term investments. The longer you let your money build and the more you’re likely to gain from it. However unlike a “fixed annuity” ((where your money sits in an account from which you’re paid a fixed income throughout a fixed period)) and a variable annuity gives you more control over your investment_but also gives you the burden of risk.

The money you deposit into “variable annuity” can go into your own account and separate from the investment portfolio of your broker or insurance company. The investment choices are, therefore, yours to make.

A “variable annuity” can provide you with a wider spectrum of investment opportunities for your retirement savings, while giving you professionally managed fund options as well.((Compare annuity offers for free! ))

You may want to play the money market, or invest in stocks, bonds, or equity funds. Your “annuity “return depends on your account’s performance rather than just rising and falling with the fortunes of the firm that holds your “annuity”.((Compare annuity offers for free! ))

“Annual Expenses”

Your broker or insurance firm may guarantee your principal investment, minus withdrawals for any of the following annual expenses.

-Annual annuity charge. This fee is based on the total value of your “variable annuity”, plus the cost to your broker/insurer of administering it and giving you the option of a lifetime’s worth of annuity income. When the contract with your annuity broker provides for death benefits, annual annuity charges increase. This is generally computed by adding M&E ((mortality and expense risk)) to administration charges.

-Underlying fund fees. The broker holding your variable annuity will normally charge you annual fees for managing your investments.

-Maintenance fees. This’s simply a yearly fee for maintaining your contract. It pays for contract administration and communication services.

-Surrender charges. If you withdraw your money within the first three to ten years of the day you took out you variable annuity, you have to pay surrender charges based on a scale of declining charges from 7% to 0%.((Compare annuity offers for free! on www.annuity-insurance.us ))

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