Why not invest in Money Market accounts instead of Annuities?
Money market accounts and Certificates of Deposit are similar to annuities, however the most significant advantage with investing in annuities is your investment and interest earned is tax deferred. Your money compounds more quickly because you earn interest on money you would otherwise being paying the IRS. With annuities you pay taxes when you begins receiving payments. Since you will receive smaller payments than the entire sum your taxes may be less as they are spread over a longer period of time. Just like any other retirement accounts, there are penalties and tax implications for early withdraw, however annuities frequently have provisions and condition that allow withdrawal without penalty. Question: What is the difference between Variable and Fixed Annuities? Answer: A fixed annuity is a contract where the annuity owner knows the current and guaranteed interest rates and exactly when that interest will be credited. Fixed annuities suit the conservative investor very well as the
