What are the advantages of an annuity?
There are three main advantages to annuities. First, annuities grow tax deferred, which means you do not pay on the interest every year like CD’s. The interest continues to compound to earn you more money. Second, annuities may be turned into a lifetime income stream. The annuity can be “annuitized” providing annual or even monthly payouts for periods of time. And lastly, annuities bypass probate. The money goes directly to your heirs similar to a life insurance policy.
