Overview
An Immediate Non-Variable Annuity is a type of insurance product designed for retirement planning. It guarantees a fixed payment starting shortly after the contract purchase, within a specific time frame.
Key Features
- Immediate Start: Payments begin at the end of the first payment interval post-purchase, which can be as soon as one month depending on the terms agreed upon.
- Fixed Payments: The payment amounts are fixed and are not variable by market performances or other investment types, providing stability and predictability in retirement income.
- Timing of Payments: Annuity payouts must commence within 13 months from the date of purchase to qualify under this category.
Benefits
- Security and Predictability: Guarantees fixed income which is predictable, secure, and unaffected by the volatility of the markets.
- Simplicity: Easy to understand and manage, offering retiree peace of mind about finances after retirement.
Considerations
- Payments are consistent but do not account for inflation; real value may decline over time.
- Ideal for retirees who require immediate, steady cash flow but might not be suitable for those looking to have flexibility in future investments.
Regulatory Reference
Ensure compliance with guidelines described in specific state laws and the Retirement Income Security Act.
Appropriate for individuals nearing or upon retirement, providing immediate financial assurance with consistent income streams.
