MFeel Secure For For annuities, Mississippi Journal Reports
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Copyright 2009 ProQuest Information and LearningAll rights ReservedCopyright 2009 Mississippi Business Journal Mississippi Business Journal
Monday 2 February 2009
SECTION: Pg. A4 Vol. 31 No. 5 ISSN: 0195-0002
ACC-NO: 12867
LENGTH: 716 words
TITLE: Many turn to the security of pensions out of the sole case
Signature: Mark, Susan
ABSTRACT
"Because interest rates so low very quickly plunged in 2008, it was a record year for fixed annuities in the United States," said Howard. "[...] This bypasses any court approval, "said Howard. TEXT
During these turbulent economic times, investors are looking for a more reliable way of the sole non-cash. In the past, certificates of deposit have been a popular way to invest money. However, many people with CD are bankers to ask them if there is another alternative. And what they have heard many bankers is to have a look at annuities.
Generally used to provide retirement income, an annuity is a contract between the buyer or owner and an insurance company. In its simplest form, an investor pays money to the issuer of an annuity, and the issuer pays the principal and income, the investor or to a designated beneficiary. The biggest advantage of an annuity is that the money of the investor increases tax deferred until withdrawn. The compromise is that if money is withdrawn before the investor reaches age 59, they must usually pay an early withdrawal of 10 percent IRS penalty.
"Annuities essentially follow the IRS guidelines," said Thomas Howard. Howard is president of Investment Services Inc, a brokerage service on stocks, bonds and variable annuities, and as Director General. Bancorp Insurance Services Inc., both of which are wholly owned subsidiaries of BancorpSouth. "Most fixed annuities have a surrender charge, similar to a CD."
Annuities can offer a fixed rate of return or let the market potential based on equity investments. Fixed annuities pay a "fixed" rate of return. The monthly payment is a fixed amount and is guaranteed. Fixed annuities May be a good choice for investors who appreciate "the safety and stability of the retirement and those who want their property to protect it from the volatility of the share or bond market.
With variable annuities, investments can be made in a variety of securities, including equity funds and bonds. Stock market performance determines the value of the pension and the return investors will receive the money they invest. The amount of risk is prepared to assume should influence the type of funds selected. Those who believe that variable annuities are generally comfortable with the fluctuations of the stock market and want their investments at the rate of inflation over a long period of time. They are generally young and want to prepare financially for retirement by reaping the gains of the stock or bond markets over the long term.
"Because interest rates so low very quickly plunged in 2008, it was a record year for fixed annuities in the United States," said Howard. "People ask for alternatives to CDs and annuities are very attractive." Howard said that the predictability of fixed annuity products are easier to understand if a person is a traditional client CD. "A customer who wants CD a rate of return higher and he wants to feel comfortable about where he seems to put his money to gravitate to fixed annuities.
Variable annuity sales price was not as well in 2008 the stock market dip of fleeing investors. Accordingly, insurers are raising prices and adding restrictions on products. But industry experts believe that sales of variable annuities should bounce back once the stock market does.
It is important to understand that an annuity is not a deposit, and there is no bank guarantee. It is not insured by the FDIC or other government agency. In the case of BancorpSouth, Howard said that the solvency of companies whose products they sell is constantly monitored. "They must meet the two highest credit ratings from the top rating agencies such as AM Best and Standard and Poors.
What do you offer a pension of an investor is a tax advantage. The annuity income is tax-deferred. Unlike mutual funds or other investments made with "after-tax money, there are no tax consequences annuity if investors change the way their funds are invested.
Another benefit of annuities is that the investor can designate a beneficiary. "Because of this, it bypasses any court approval," said Howard. While an annuity can provide a stream of payments that last as long as you do, they are mainly used to transfer wealth.
LOAD-DATE: March 2, 2009
Copyright © 2009 LexisNexis, a division of Reed Elsevier Inc.. All rights reserved
Terms and Conditions Privacy Policy
Monday 2 February 2009
SECTION: Pg. A4 Vol. 31 No. 5 ISSN: 0195-0002
ACC-NO: 12867
LENGTH: 716 words
TITLE: Many turn to the security of pensions out of the sole case
Signature: Mark, Susan
ABSTRACT
"Because interest rates so low very quickly plunged in 2008, it was a record year for fixed annuities in the United States," said Howard. "[...] This bypasses any court approval, "said Howard. TEXT
During these turbulent economic times, investors are looking for a more reliable way of the sole non-cash. In the past, certificates of deposit have been a popular way to invest money. However, many people with CD are bankers to ask them if there is another alternative. And what they have heard many bankers is to have a look at annuities.
Generally used to provide retirement income, an annuity is a contract between the buyer or owner and an insurance company. In its simplest form, an investor pays money to the issuer of an annuity, and the issuer pays the principal and income, the investor or to a designated beneficiary. The biggest advantage of an annuity is that the money of the investor increases tax deferred until withdrawn. The compromise is that if money is withdrawn before the investor reaches age 59, they must usually pay an early withdrawal of 10 percent IRS penalty.
"Annuities essentially follow the IRS guidelines," said Thomas Howard. Howard is president of Investment Services Inc, a brokerage service on stocks, bonds and variable annuities, and as Director General. Bancorp Insurance Services Inc., both of which are wholly owned subsidiaries of BancorpSouth. "Most fixed annuities have a surrender charge, similar to a CD."
Annuities can offer a fixed rate of return or let the market potential based on equity investments. Fixed annuities pay a "fixed" rate of return. The monthly payment is a fixed amount and is guaranteed. Fixed annuities May be a good choice for investors who appreciate "the safety and stability of the retirement and those who want their property to protect it from the volatility of the share or bond market.
With variable annuities, investments can be made in a variety of securities, including equity funds and bonds. Stock market performance determines the value of the pension and the return investors will receive the money they invest. The amount of risk is prepared to assume should influence the type of funds selected. Those who believe that variable annuities are generally comfortable with the fluctuations of the stock market and want their investments at the rate of inflation over a long period of time. They are generally young and want to prepare financially for retirement by reaping the gains of the stock or bond markets over the long term.
"Because interest rates so low very quickly plunged in 2008, it was a record year for fixed annuities in the United States," said Howard. "People ask for alternatives to CDs and annuities are very attractive." Howard said that the predictability of fixed annuity products are easier to understand if a person is a traditional client CD. "A customer who wants CD a rate of return higher and he wants to feel comfortable about where he seems to put his money to gravitate to fixed annuities.
Variable annuity sales price was not as well in 2008 the stock market dip of fleeing investors. Accordingly, insurers are raising prices and adding restrictions on products. But industry experts believe that sales of variable annuities should bounce back once the stock market does.
It is important to understand that an annuity is not a deposit, and there is no bank guarantee. It is not insured by the FDIC or other government agency. In the case of BancorpSouth, Howard said that the solvency of companies whose products they sell is constantly monitored. "They must meet the two highest credit ratings from the top rating agencies such as AM Best and Standard and Poors.
What do you offer a pension of an investor is a tax advantage. The annuity income is tax-deferred. Unlike mutual funds or other investments made with "after-tax money, there are no tax consequences annuity if investors change the way their funds are invested.
Another benefit of annuities is that the investor can designate a beneficiary. "Because of this, it bypasses any court approval," said Howard. While an annuity can provide a stream of payments that last as long as you do, they are mainly used to transfer wealth.
LOAD-DATE: March 2, 2009
Copyright © 2009 LexisNexis, a division of Reed Elsevier Inc.. All rights reserved
Terms and Conditions Privacy Policy
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