Annuity

An annuity comes in many forms, but a simple definition is that an annuity is a contract that converts a sum of money into a series of periodic payments for an agreed upon period of time. An annuity can be thought of as a financial vehicle that converts a pool of money into a stream of income. Annuities are most useful in addressing the financial planning needs of people in or approaching retirement. Annuities are unique in the financial world because they can provide protection against the risk or outliving one’s assets (longevity risk) by guaranteeing income payments in perpetuity or any other selected amount of time. Annuities can be viewed as a type of personal pension plan. Social Security is similar to an annuity in that money contributed over the course of one’s working years is converted into a series of periodic payments that provide income during retirement.

Treasury Officials Seeking Automatic Annuity Options for 401k Plans

Officials from the Departments of Treasury and Labor want annuities to be a default option for workers who participate in employer-sponsored retirement plans such as 401ks. At a recent industry conference, Treasury senior advisor Mark Iwry spoke of creating annuity-based lifetime income options within the defined contribution 401k arena. Issues such as credit risk and portability continue to present obstacles to progress. Employer fiduciary liability with respect to in-plan annuity selection is...

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Financial Advisors on the Defensive as Variable Annuities Prove to be Among Best Wealth Management Vehicles of Past Decade

A recent article from Wall Street Journal columnist Leslie Scism discusses the value that has been preserved and delivered over the past several years by variable annuities and living benefits . Despite intense media criticism and generally negative perceptions among financial advisors, variable annuities have been among the best wealth management vehicles of the past decade. The performance and value have been especially evident during the recent capital markets implosion. Scism makes the...

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Annuity

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Equity Indexed Annuity

Submitted by tom on Sat, 09/12/2009 - 15:37

This discussion thread is being created for a question that was originally presented in the FAQ section.

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NAPFA Provides Consumers with Quality Control while Maintaining Flexibility for Financial Advisors

NAPFA is the National Association of Personal Financial Advisors.

NAPFA membership consists of financial advisors who provide comprehensive...

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Hartford Financial to Focus Less on Annuities

In contrast to Metlife , the Hartford Financial Services Group is shifting its business away from annuities. Hartford's new CEO recently announced that the company will be focused on developing a core insurance franchise, and that the annuity business will be a somewhat peripheral concentration: As it recovers, Hartford will de-emphasize its former annuity focus and be an "insurance franchise with a concentration in the annuity business," Ayer said. Source: Wall Street Journal Full Story

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