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An annuity is a financial product typically sold by insurance companies. It is designed to accept and grow funds from an individual and then pay out a stream of payments to the individual at a later point in time. Annuities are primarily used as a means for securing a steady cash flow during retirement.
Annuities provide a guaranteed# income stream, offer tax-deferred growth, protect against market volatility, and have flexible payout options. They are an attractive option if you're looking for a stable source of income during retirement.
The importance of an annuity in retirement planning stems from its ability to provide a reliable income source during retirement. It can serve as a financial cushion, ensuring you have a steady flow of income in your golden years.
Absolutely. While they are particularly attractive for retirees, annuities can also be beneficial for risk-averse investors seeking stability, high-income earners looking to invest beyond the limits of traditional retirement accounts, and individuals seeking estate planning solutions.
Like any investment, annuities do have potential downsides. These can include surrender charges, fees, and potential tax penalties for early withdrawal. The returns on fixed annuities may not keep pace with inflation.
There are primarily three types of annuities - fixed, variable, and indexed. Fixed annuities offer a guaranteed# payout, while variable annuities' payouts vary based on the performance of the investment portfolio. Indexed annuities combine features of both, offering a minimum guaranteed# payout with an additional return that may vary based on a specific equity-based index's performance.
The tax treatment of annuity payouts depends on several factors, including the type of annuity, whether it is held in a qualified retirement plan, and the nature of the payouts. In general, the portion of the payout that represents earnings from the annuity investment will be subject to income tax.
Yes, you can withdraw money from your annuity before retirement. However, withdrawals made before the age of 59 may be subject to a 10% early withdrawal penalty in addition to regular income tax. Yes, you can withdraw money from your annuity before retirement. However, withdrawals made before the age of 59 may be subject to a 10% early withdrawal penalty in addition to regular income tax.
Certain types of annuities do allow for the remaining benefits to be passed on to your heirs upon your death. The specific rules and options can vary, so it's important to understand your annuity contract or consult with a financial advisor.
A fixed annuity guarantees your principal, so you won't lose value. However, a variable annuity is subject to market risk, and its value can fluctuate based on the performance of the underlying investments. Thus, it's possible to lose value with a variable annuity.
Give ₹1 lakh/ month for 5 years and Get ₹ 4.06 lakhs every year till your life1
Multiple annuity options, Regular income stream.
Guaranteed# lifelong income
Top-up option for annuity
Single/Joint Life cover option
Deferred annuity option
Give :
₹ 1 lakhs/Month for 5 year¹
Get :
₹4.06 lakhs/-
1 Annuitant -Health Male: Age 45 years invests in ABSLI Guaranteed Annuity Plus | Annuity Option: Deferred Life Annuity with Return of Premium | Premium payment term – Limited pay (5 years) | Purchase Price: Rs. 1,00,000/ month including modal loading for 5 years | Deferment period: 5 years Annuity Pay-out Frequency: Annual | Single life. Get Rs 4,06,340 /- (Exclusive of taxes) every year till annuitant is alive.
ABSLI Guaranteed Annuity Plus Plan is a Non-Linked, Non-Participating, General Annuity Plan (UIN: 109N132V15).
*Tax benefits are subject to changes in tax laws. Kindly consult your financial advisor for more details
#Provided all due premiums are paid
ADV/6/24-25/655
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