What You Should Expect from a Multi-Guaranteed Annuity
July 6, 2023
A multi-guaranteed annuity provides a locked interest rate for the defined term of the fund. If you want an investment that ensures a guaranteed rate of return for some peace of mind when you retire, this annuity offers that security. Especially for those who are getting ready to retire, this type of annuity provides you with some certainty in your future income. There are a few things that you should understand as you decide if this is the right fund for your future goals.
The Basics of a Multi-Guaranteed Annuity
Multi-guaranteed annuities are contractual agreements in which you pay a set amount in advance for a guaranteed interest return on that money. You commit that money to the fund for that period and agree to pay withdrawal penalties if you need to withdraw money prematurely.
Your multi-year guaranteed annuity may allow for some penalty-free advanced withdrawals. At the end of the fund period, you may be able to renew it for an additional term or even transition it to a new fund. Any change like this may come with a different interest rate based on prevailing rates.
The Benefits of a Multi-Guaranteed Annuity
The multi-year guaranteed annuity offers many benefits for those approaching retirement. The guaranteed rate of return provides certainty even in an unpredictable market because market changes do not affect the rate once you lock it in.
The multi-year guaranteed annuity also offers some flexibility to withdraw specific amounts each year if necessary. It is ideal if you want a fund that defers your tax liability until you withdraw money or take a disbursement. Deferring taxes allows you to pay taxes on those earnings later in life when you are likely in a lower tax bracket, saving you money as well.
The Investment in a Multi-Guaranteed Annuity
When you understand the fundamentals of these funds, it helps you establish realistic multi-guaranteed annuity expectations. When you are close to retiring and want a safer option for increasing your income or are conservative about investments and want to avoid the risks of a volatile market, this kind of annuity is a great option.
If you have the time to be more aggressive about your investments, you can take more significant risks. A multi-year guaranteed annuity may not offer the best solution in those cases. However, it is beneficial when you need to boost your earnings without fear of losing your investment for those years after you retire.
Discuss your goals and current financial situation with your chosen carrier to establish an annuity fund that meets your long-term needs and fits your preferred risk levels.
About 1891 Financial Life
At 1891 Financial Life we don’t just sell policies, we offer possibilities. We pride ourselves on giving back to the communities that we serve by providing quality and comprehensive insurance solutions. We are a not-for-profit life insurance Society, which means the sales from these financial service products help fund member benefits along with social, educational, and volunteer programs designed to respond to community needs. In 2023, 1891 Financial Life was listed by Forbes as one of "The World's Best Life Insurance Companies."
Our portfolio is extensive, ranging from various life insurance policies to our annuities to support your financial needs no matter what stage of life you’re in.