Malaysian normally do not think much about annuities, not to mention buying one for their golden years. There are better investment options than investing in an annuity just for the sake of living too long! Some seemingly dull topic here…. but our GUEST BLOGGER and California-based financial advisor, Ms. Sharon Smith think otherwise.
Read her stuff to get a better feel of what’s DEATH & PENSION ANNUITIES:
Annuities are agreements between the investor and the insurance companies. The person receiving the annuity payment is known as the annuitant. Apart from the annuitant, a beneficiary is also named as a nominee in the agreement.
A death & pension annuity benefit is different from that of other annuity benefits. It is received by the beneficiary if the owner dies before the full payment of the agreement amount.
Annuities can be fixed as well as deferred. If you go for fixed immediate annuity, you would start receiving returns almost immediately. In case the annuitant dies before the full payment, the beneficiary receives the rest of the amount.
In case of deferred annuity, the payment is not received immediately. The payment is received on a specific date as mentioned earlier in the agreement. In this case, if the owner dies, the benefits received are better. But as the term deferred suggest, the owner might lose some money if the market is not doing well enough.
The pension annuity benefits depend on certain factors as:
Death & pension annuity benefits are different for men and women. This is because, according to a few researches, women live longer than men.
Some of the pension annuity plans are:
Remember to carefully plan before investing in death & pension annuities. Read all the options minutely. Usually, the brochure provided by the insurance company contains all the details necessary about the various annuities and their benefits. However, if you have any doubt, make sure to consult a financial advisor to clear it. They will be able to guide you towards the proper direction.
Check for all the pros and cons of each of the annuity options that you plan to invest in. This will help you to choose the best that suits your specific requirements.
What do you think? Are they applicable for the general Malaysian public?