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Are annuity investments worth it for seniors?
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Annuities are a popular insurance option for seniors because they can provide stable income while preserving your assets and offering tax advantages. When you purchase an annuity, you agree to pay your premiums to the financial institution, and that money is then invested in an annuity fund.
In return, the financial institution agrees to make regular payments to you for a predetermined period, up to the remainder of your life in some cases. And, those payments could start immediately or years down the road.
Considering the benefits, annuities can be a compelling way to plan for retirement in your working years. But what if you’re a senior citizen who’s already retired or is planning to retire soon? Are annuities worth it for you?
Find out how an annuity can help you manage your retirement finances today.
Are annuity investments worth it for seniors?
“Annuities are one of many investments that may make sense for seniors,” says Dan Casey, investment advisor and founder of Bridgeriver Advisors. Here are a few reasons seniors may want to consider annuities:
They can provide a stable income
As a senior, it’s typically important that your investment portfolio offers reliable income — and an annuity could help.
“If you like guaranteed income, then an income annuity may make sense,” says Casey.
Income annuities typically offer regular monthly payments to investors — and there are several options to choose from. For example, if you choose an immediate annuity, you’ll make a large lump sum investment and will then start receiving your monthly annuity payments shortly after — typically the following month.
Or, if you don’t need the income immediately and want to take advantage of annuity growth, you can also choose a deferred annuity instead. These are contracts between you and the insurance company by which you start paying premiums immediately and the insurance company provides regular payments that start at some future date.
Invest in an annuity now for a stable retirement income stream.
There are different types of annuities to choose from
Immediate and deferred annuities are just two types of annuities you can choose from. However, all types of annuities fall into one of two categories, fixed or variable, and each offers a different set of benefits.
“There is a large contrast between fixed and variable annuities as well as several similarities between both types,” says Peter Casciotta, owner of Asset Management & Advisory Services.
These types of annuities “drastically differ regarding asset preservation and/or the need to protect one’s principal,” Casciotta says.
If you’re interested in protecting your principal to ensure it covers you throughout your retirement, then a fixed annuity could be the better option. However, if you’re more concerned with asset growth, a variable option may be the better choice in your situation. It’s important to note, though, that variable annuities can also decline in value, so it’s important to do your research before making a decision.
You can customize your coverage
Annuities are also customizable, and you can add riders to these products like you could if you were to customize and enhance a life insurance policy. Some of the more common annuity riders include:
- Long-term care: The majority of adults over the age of 65 will need some form of long-term care at some point in their lives — and that care can be costly. Adding a long-term care rider to your annuity could help you cover the cost of this type of care if you need it later in life.
- Guaranteed minimum withdrawal: This allows you to withdraw a set amount of money from your annuity on an annual basis until you’ve withdrawn the entire investment value.
- Guaranteed minimum income benefit: This rider is particularly useful for variable annuities because it guarantees a minimum income even if the annuity’s underlying investments generate losses.
- Impaired risk rider: This is an important rider if you have a pre-existing condition that’s likely to limit your lifespan. It provides higher annuity payments in consideration of the shorter span in which those payments will likely be needed.
- Inflation rider: These riders help to make sure your annuity payments grow alongside consumer prices up to a certain limit.
Find out how an annuity can help you achieve your retirement goals.
The bottom line
Annuities may make sense to consider for seniors — and that’s especially true for those who are looking to generate a stable income or protect themselves from growing prices. And, with different types of annuities to choose from and several riders to customize your coverage, an annuity could be a valuable tool to help you successfully manage your finances as a senior.
NEW YORK — Former New York Gov. David Paterson and his stepson were attacked in New York City on Friday night, authorities said.
The incident occurred just before 9 p.m. on Second Avenue near East 96th Street on the Upper East Side, according to the New York City Police Department.
Police said officers were sent to the scene after an assault was reported. When officers arrived, police say they found a 20-year-old man suffering from facial injuries and a 70-year-old man who had head pain. Both victims were taken to a local hospital in stable condition.
In a statement, a spokesperson for the former governor said the two were attacked while “taking a walk around the block near their home by some individuals that had a previous interaction with his stepson.”
The spokesperson said that they were injured “but were able to fight off their attackers.”
Both were taken to Cornell Hospital “as a precaution,” he added.
Police said no arrests have been made and the investigation is ongoing.
The 70-year-old Paterson, a Democrat, served as governor from 2008 to 2010, stepping into the post after the resignation of Eliot Spitzer following his prostitution scandal. He made history at the time as the state’s first-ever Black and legally blind governor.
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A 17-year-old boy was critically injured and a person is in custody after a gunman opened fire on a SEPTA bus in North Philadelphia Friday evening, police said.
At around 6:15 p.m., Philadelphia police were notified about a shooting on a SEPTA bus traveling on Allegheny Avenue near 3rd and 4th streets in North Philadelphia, Inspector D F Pace told CBS News Philadelphia.
There were an estimated 30 people on the bus at the time of the shooting, Pace said, but only the 17-year-old boy was believed to have been shot. Investigators said they believe it was a targeted attack on the teenager and that he was shot in the back of the bus at close range.
According to Pace, the SEPTA bus driver alerted a control center about the shooting, which then relayed the message to Philadelphia police, who responded to the scene shortly.
Officers arrived at the scene and found at least one spent shell casing and blood on the bus, but no shooting victim, Pace said. Investigators later discovered the 17-year-old had been taken to Temple University Hospital where he is said to be in critical condition, according to police.
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Through their preliminary investigation, police learned those involved in the SEPTA shooting may have fled in a silver-colored Kia.
Authorities then found a car matching the description of the Kia speeding in the area and a pursuit began, Pace said. Police got help from a PPD helicopter as they followed the Kia, which ended up crashing at 5th and Greenwood streets in East Mount Airy. Pace said the Kia crashed into a parked car.
The driver of the crashed car ran away but police were still able to take them into custody, Pace said.
Investigators believe there was a second person involved in the shooting who ran from the car before it crashed. Police said they believe this person escaped near Allegheny Avenue and 4th Street, leaving a coat behind.
According to Pace, police also found a gun and a group of spent shell casings believed to be involved in the shooting in the same area.
“It’s very possible that there may have been a shooting inside the bus and also shots fired from outside of the bus toward the bus,” Pace said, “We’re still trying to piece all that together at this time.”
This is an active investigation and police are reviewing surveillance footage from the SEPTA bus.