Variable Annuities: Asking the Right Questions

If you are considering purchasing a variable annuity, you will want to make sure that you do your homework first. When talking to a financial adviser, here are a few questions that you will want to ask about a variable annuity product before purchasing.

What Is the Death Benefit?

When you purchase a variable annuity, it is important that you understand what the death benefit is and how it works. You do not want to pay into something for many years and then not be able to leave anything to your family members when you die. Therefore, it is important to ask them about the death benefit and how your beneficiaries will be paid if you die.

What Are the Costs Associated with This Annuity?

The insurance company is going to charge you something for this annuity product. Regardless of whether they charge you a portion of your premiums or take a percentage out of your gains from investment, they are going to get their money somehow. Make sure that you understand how the fee structure works with this variable annuity.

What Is the Strength of the Company?

You also want to make sure that you are investing with a financially strong annuity provider. You want someone that is going to be around when you are ready to start collecting your annuity payments.

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