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Life Annuities Overview

By: Evirgreen

A life annuity is an investment which converts the lump sum of your RRSP's or non registered funds into an income for the rest of your life.

When it comes time to consider buying a life annuity, you have a number of choices.

Retirement Income Planning

Most companies have a long history of providing a range of options to secure your income in retirement. You can select the most competitive ways to make the best use of your pension funds, whether registered or non registered.

Factors That Influence Life Annuities

Interest Rates
- Life Annuities are influenced by interest rates and other market factors.

Mortality
- Your life expectancy and that of your spouse affects the life annuity income. The older you are the higher the income you will receive.

Life Annuity Options
- The options you choose from the start will affect your life annuity income. Choosing a longer guarantee period will reduce the amount of income.

Gender
- The starting income is higher for a man than a woman as, on average, women live longer.

LIFE ANNUITY OPTIONS

Single life annuity
- Pays you an income for the rest of your life.

Joint Life Annuity
- Pays you an income for your lifetime. Upon death, your surviving partner will continue to receive an income at a level agreed upon.
The level is a percentage of your income, normally 100%, rarely another figure.
The partner's life annuity pension will continue for their lifetime.

Level Income
- Pays you a fixed income, which is agreed upon at issue.

Increasing Income
- Pays you a life annuity income that increases each year by a fixed percentage.

Guarantee Period
- Your life annuity income will continue to the beneficiary of your estate on your death if you die within the guarantee period.

No Guarantee Period
- Your life annuity income will cease on death unless a joint life plan, where the income will cease at the second death.

Payment Frequency
- Monthly or Annually

Article Source: http://www.FindAffordableInsurance.com

Our insurance directory provides for life annuity, and also provides comprehensive advice for choosing life insurance.

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