Seniors & Annuities: How You Can Help Your Senior Clients

Published on December 22, 2020

Annuities can help seniors build a financial plan for their future expenses in retirement.

Planning for the future is something we all do, no matter our age. Preparing your finances for the future is especially important for senior citizens nearing retirement. How someone plans on financing their lives during their retirement requires knowledge of the options available, such as life insurance, savings accounts, and annuities.

Annuities are a fixed amount of money paid out to a beneficiary yearly. These payments are typically distributed for the remainder of the recipient’s life. With annuities, seniors can build savings that are tax-deferred and can help manage retirement costs. Before buying your annuities, be sure to contact a seasoned insurance agent who can help find the right purchase for you.

How Can Annuities Help You?

Annuities are an investment which is paid back to the purchaser annually. These payments can be used to cover any costs while in retirement, such as health care, bill payments, food, and additional costs of living.

Purchasing an annuity can also help you prepare for unknown and unexpected costs that may eventually exceed your savings account. Minor and significant expenses can add up quickly. Adjusting to life without steady paychecks can be difficult, but annuities can bring back your feelings of security. Maintaining your lifestyle and keeping up with additional medical bills while depending solely on Social Security benefits can be an uphill battle. The worry of outliving your finances can be scary to anyone, but annuities offer a long-term plan to put your mind at ease. The majority of annuity purchases come with a lifelong payment guarantee, lifting the weight of future financial strain from your shoulders.

How Do I Purchase an Annuity?

Typically, insurance companies offer annuity options to their clients; however, they can also be sold by independent brokers, mutual funds, banks, and financial advisors. Contacting a professional in senior citizen finances is an integral part of purchasing the right annuity for your future and budget.

Annuities can be purchased with a one-time lump sum payment or with a series of premiums. Deferred annuities are distributed to the recipient after a predetermined time. On the other hand, immediate annuities are paid out 12 months after purchase. Seniors have the option to pay for their annuities out of their own savings account, or they can transfer money from qualified retirement plans.

When Should You Purchase an Annuity?

The timing differs from person to person. There are roughly 47.8 million senior citizens in the United States, making them the main purchasers of annuities. The status of your 401K and savings account can be indicators of when you should buy your annuity. Seniors will need to decide which annuity is right for their situation. Immediate annuities are likely the smart choice, as they pay out after only 12 months and continue payments until the end of life. However, if you do not have substantial savings set aside to cover living expenses, it may not be the right time to purchase an annuity. It is an investment in your future, but it shouldn’t add to your financial strain today.

Final Thoughts

The purchase of an annuity is a smart choice for seniors planning their finances for retirement. Annuities typically payout until the end of the recipient’s life, making them a great way to provide regular income for a senior. Contacting an insurance agent with considerable annuity knowledge is essential before making your purchase.

The experienced insurance team at American Senior Benefits specializes in helping seniors purchase quality annuities and insurance products to benefit their financial futures. Insurance agents with American Senior Benefits are knowledgeable in their field and make their clients’ financial security their top priority.

How Do I Learn More?

To learn more about annuities and how they benefit seniors, contact us at American Senior Benefit. Our licensed experts will be happy to answer any questions you have.

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