Senior or Final Expense Life Insurance, is usually a guaranteed issue whole life policy. The premium remains level for the rest of your life. The death benefit may be graded for the first few years. For example, the benefit may be 25% or 50% of the full policy face amount during the first year the policy is in force and increases in annual increments to the full face amount in subsequent years. Depending on one's age, guaranteed amounts up to $25,000 are available. Higher amounts are available subject to one's good health.

An annuity is a contract between you and an insurance company that is designed to meet retirement and other long-range goals, under which you make a lump-sum payment or series of payments. In return, the insurer agrees to make periodic payments to you beginning immediately or at some future date.

Annuities typically offer tax-deferred growth of earnings and may include a death benefit that will pay your beneficiary a specified minimum amount, such as your total purchase payments. While tax is deferred on earnings growth, when withdrawals are taken from the annuity, gains are taxed at ordinary income rates, and not capital gains rates. If you withdraw your money early from an annuity, you may pay substantial surrender charges to the insurance company, as well as tax penalties.

There are generally three types of annuities — fixed, indexed, and variable. In a fixed annuity, the insurance company agrees to pay you no less than a specified rate of interest during the time that your account is growing. The insurance company also agrees that the periodic payments will be a specified amount per dollar in your account. These periodic payments may last for a definite period, such as 20 years, or an indefinite period, such as your lifetime or the lifetime of you and your spouse.

In an indexed annuity, the insurance company credits you with a return that is based on changes in an index, such as the S&P 500 Composite Stock Price Index. Indexed annuity contracts also provide that the contract value will be no less than a specified minimum, regardless of index performance.

In a variable annuity, you can choose to invest your purchase payments from among a range of different investment options, typically mutual funds. The rate of return on your purchase payments, and the amount of the periodic payments you eventually receive, will vary depending on the performance of the investment options you have selected.

 

Due to the complexity, variations, and large number of variables, no quote form is provided on our site. Please email us at Reata@eSureTexas.com for information, advise, and recommendations on fixed and indexed annuities. We represent a large number of annuity companies. Our agency does not place variable annuities or provide any other equity investment advise.