Find The Best Company Offering Top Fixed Annuity Rates
As the economy continues to fluctuate between extremes, more and more investors are adopting a more conservative approach to making investments. For that reason, there has been surge in the popularity of the fixed annuity market. This leads many of us to wonder if there is a simple way to find out which companies are offering the top fixed annuity rates and how we can take advantage of them.
The Fixed Annuities
For the most part, fixed annuities are issued mainly by life insurance companies but you can always purchase them through banks, brokerage firms, and independent advisors. Most of them are available for purchase online, but keep in mind that the Internet is a vast market so you'll have to take extreme care when choosing which investment option that is right for you. Because the Internet is so wide, don't be surprised if you find yourself overwhelmed by the number of choices you'll have to sift through. In addition, finding the top fixed annuity rates involves more than just looking for a list online. The smart investors know that they need to understand the fundamentals that determine what qualifies as a top fixed annuity.
Fixed annuities are found in the same market as bank CDs and many other fixed yield investments. Some of the best fixed annuities come with a first year bonus rate, which can be very attractive to a new investor. However, after that first year, the rates will be adjusted to the book value of the underlying investment of the insurance company. Others offer a longer yield period to guarantee that the earned returns are tied to the deposit size or a fixed term. You want to be on the watch for those annuities that offer an unusually high bonus rate in the beginning but the rates in subsequent years are close to minimum. It is important that you analyze these small details closely before deciding on an annuity to invest in.
You also need to take a close look at the tiered rate structure. Most fixed annuities are tiered in that they reward bigger investors. Those that make larger deposits or invest for longer time frames generally fare better than the small time investor. With top fixed annuity rates the tiers usually range from five to ten years with a few variations in between. Look closely at the difference in the rates and see how it will fit within your budget plan. There may be huge differences that can determine if that annuity will work for you.
Other factors you'll need to consider are the guaranteed return of your principal and the conditions surrounding the withdrawal period and fees. Once you have established a clear understanding of how these factors can impact the performance of a specific annuity, it will be easy to determine whether or not it is an annuity you can work with. You can now develop a short list of possible annuities to invest in that can reward you well in your future.
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