Insurance Planning and Annuities

Insurance protects you from the unexpected, and no one can control those situations. The key is to be prepared. You may always put your family first, but what would happen to your family if they would have to continue without you? Having insufficient coverage or no coverage at all could have devastating effects on your family when they need the support the most.

Your financial advisor can assist you in determining how much life insurance you might need. Consider these elements in your planning: Hospital bills, funeral costs, estate taxes. Adjusting to a new situation might require funds to relocate or find a job. It is important to be able to function in the interim for financial needs such as monthly bills, college tuition or long-term retirement plans.

If you are looking for a shorter or a specific time for protection, you might consider term life insurance. This plan covers for a specific time period and death benefits are only paid if death occurs. The policy costs less, but provides equal protection, but only for a specific time.

What is a variable annuity? This is a contract between you and the life insurance company. When you pay your premiums, the insurance company agrees to provide you a systematic stream of income or a lump sum or payout in the future or when you retire. A variable annuity has an accumulation phase and it also has an income phase. Your payments toward the premiums can be invested in securities and other options in your portfolio. Any growth in your annuity accumulates on a tax-deferred basis. When you are ready to take out distributions usually at retirement, you may choose to have your principal and your interest paid out to you in the form of income. You may also take out systematic withdrawals or receive a lump sum payout.