Annuities come in various forms:
Immediate annuity plans:
Immediate annuity plans are acquired with a lump sum payment that starts from the very incitation and helps save the amount.
Deferred annuity can be subdivided into the following categories:
The accumulation period begins when you first pay your premium and lasts until you have accumulated enough money to retire.
The vesting period:
The vesting period is when you will begin receiving policy benefits in the form of a pension.
Here’s how different annuity plans work:
Life annuity: The scheme will pay you annuity payments on a monthly, quarterly, or annual basis as long as you live. After your death, the annuity will come to an end.
Life annuity with purchase price return: You will continue to receive annuity payments until you pass away. After that, the insurer refunds your nominee the initial sum that was utilized to acquire the annuity. It is an excellent alternative for people who wish to leave a lasting legacy.
An annuity is payable for a set length of time: Even if the annuity buyer dies, the annuity will be paid for a set amount of time, such as 5, 10, or 15 years. The annuity ends when the annuitant dies or the guaranteed period expires, whichever comes first.
An inflation-indexed: Annuity is one in which the annuity is increased at a certain rate each year, such as 2% or 5%. The concept is that, while it may not be tied to the real inflation rate, it will cover the higher in expenses to some extent.
Annuity for a joint-life survivor: It will continue to pay until either you or your spouse dies.
Joint life annuity with purchase price return: It will continue to pay as long as you or your spouse are alive. In the event that both parties die, the nominee is entitled to the initial investment amount.
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