Best Variable Annuity Choice
All large insurance firms provide their own brand of variable annuities, and plans labeled “best variable annuities” by one insurer can differ significantly from another. In part, this is because variable annuity plans are brought to market in order to keep up with the rate of inflation. Since a variable annuity imposes investment risk on you as its owner, it is important that choose the best — one with the appropriate flexibility.
Variable Annuity Considerations
When making your choice from among available variable annuities, you should consider three major factors: First, you need to ascertain the performance of its separate accounts. Second, consider the initial minimum buy-in of the plan and its associated expenses. Third, be aware of the optional riders that may be added to the variable annuity contract.
Variable Annuity Performance
The best variable annuity programs utilize separate accounts for placing money in high to low interest investments. However, remember that only the money market sub-account can completely isolate you from market volatility. Additionally, not all investment portfolios may be offered as separate accounts in annuity programs, and the ability to move funds between investment portfolios in a variable annuity plan can be limited.
A big attraction of variable annuities is the ability to manage one's own money. Since you'll be allocating between various sub-accounts, its critical to ascertain what investment options will be available. If you're interest in international growth stocks, make sure your variable annuity plan features this sub-account.
Variable Annuity Costs
Always look for the lowest administrative costs when reviewing variable annuity contracts. Typically, you will find that the better annuity programs impose higher administrative fees. While this is not always the case, it pays to be prepared to acknowledge the fact. Also be sure that any variable annuity you are considering imposes the lowest possible withdrawal fees. If you plan to withdrawal early, be sure that your plan features a generous annual withdrawal allowance (10%).
Variable Annuity Contract Customization
The best variable annuity contracts may include “riders” that essentially customize the plan for the individual owner. In the same way that life insurance firms provide add-on features to customize a policy for a particular individual, annuity firms tailor their variable annuity offerings with optional features. The best variable annuities should offer you as many of these riders as you want, but be aware that different annuity providers offer different riders. When dealing with riders, be sure to read the contract thoroughly before signing.
Variable Annuity Investment Help
You can do research online to find the best variable annuities. Visit the Variable Annuity Guide for a complete breakdown of variable annuity features, tax benefits, common pitfalls, and even alternative investment ideas.
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