Annuities offer a regular stream of income for a set number of years. They are considered to be a good investment option as you can invest as much as you want to in these products without any annual investment cap, as in case of 401K or IRAs .Also annuities do not attract any taxes from the government. It is reasons such as these, that make annuities one of the preferred investment options and the sale of annuity products continues to grow. Keep scroll down to know how to selling your annuity
Why selling your annuity
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Though there is a hike in the sales numbers, annuities still face criticism on a number of fronts. One major problem of annuities as perceived by the majority of the investors is their lack of liquidity and flexibility. It is very common that over a period of time your financial position may have changed and you are in need of lump sum amounts as against a fixed regular income – you may have a medical emergency, need to pay off debt, start a business – for all such reasons you may consider selling your regular income stream to obtain a lump sum. You can sell either part or full annuities to cash in.
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What you need to know when selling your annuities
Documents
First of all, you need to gather all the documents that prove ownership of your annuity, the actual policy document, and the recent annuity payment check in-case you started collecting on your annuity. Also, make sure your annuities are transferable, or you can’t sell them.
Find out the value of your annuities
As they say a bird in hand is worth two in the bush. Annuities are future payments, the value of money changes over a period of time; hence you need to find out the value of your future payments in today’s money. This evaluation would be done free of charge by many reputable buyers in the market with no obligation or pressure to actually sell your annuities. This helps you decide, if you want to sell your annuities in full or part based on your financial needs.
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Understand the various purchase and payment options
There are many ways in which you can sell and receive the payments for your annuities; you need to understand them well to make a better decision.
- Straight purchase: Buyer makes a onetime lump sum payment and you do not receive any annuity payments.
- Partial purchase: Inpartial purchase, buyers purchase your future payments for a specific number of years, upon completion of the said time period you would receive your regular annuity payments.
- Split purchase: Buyers can also opt to buy a portion of your monthly payments for a lump sum amount.
Hire the best broker
You may chose to handle the sale process yourself at no extra brokerage, but hiring a professional will relieve you of a lot of work. These professionals offer many options and negotiate a better deal for you. You can research online for a reliable and good broker to help you with the sale process.
Selling annuities is selling your future and financial security; as such it is a huge decision. You need to research thoroughly at every stage of the sale process, making use of various online and offline resources available.
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