Annuities in Knoxville, Tennessee
Annuities are financial products that can offer a means of securing a steady income for the future. These instruments establish contracts with an insurance company, which makes a series of income payments at regular intervals in return for your initial investments.
How Do Annuities Work?
When you purchase or invest in an annuity, you’re essentially buying an income stream for the future, such as during retirement. There are several different types of annuities, including the blueprint annuity designed to provide a predictable income stream and the structured settlement annuity often used to provide regular payments to someone who has won a legal settlement. Most annuities fall under the following primary classifications:
- Fixed annuities may include a minimum guaranteed interest rate and will not lose value over time.
- Variable annuities can provide more significant growth potential than their fixed counterparts, as value over time is tied to market conditions.
- Indexed annuities may offer a hybrid between fixed and variable annuities, including a minimum guaranteed interest rate and growth according to an underlying index, such as the S&P 500.
How Often Do Annuities Compound?
The compounding frequency of annuities can vary based on the specific terms of the contract. Some annuities may compound annually, semi-annually, quarterly or even monthly. The more frequently the interest compounds, the greater the overall return may be over time.
We’re Here to Help
Annuities can be a valuable tool for securing a steady income during retirement and enjoying financial peace of mind. However, these products are also nuanced and complicated, and investments should be carefully considered.
Tennessee State Insurance Inc. is dedicated to assisting individuals and families as they seek to protect and secure their financial futures. Contact us today to learn more about annuities.