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Why so many people are putting money into annuities today

Tue, 05 Aug 2025 07:38:24 -0700

Why so many people are putting money into annuities today

People are putting money into annuities today for several key reasons—especially in today’s economic and market environment. Here’s a breakdown of the main motivations:

Guaranteed Income in Retirement

Many are drawn to lifetime income guarantees that annuities offer, especially as pensions disappear and Social Security may not cover all retirement needs. With an annuity, you can convert part of your savings into a predictable income stream.

Stock Market Volatility

In uncertain markets, fixed or indexed annuities provide downside protection:

Fixed annuities guarantee a set return.
Indexed annuities offer upside potential tied to a market index (e.g., S&P 500) but with a floor, so you don’t lose principal during downturns.

Higher Interest Rates = Better Annuity Payouts

As of 2024–2025, interest rates are relatively high. That’s good for annuities:

Immediate annuities and fixed annuities are offering more attractive payouts than in past low-rate environments.
People are locking in these higher rates now, fearing future declines.

Tax Deferral

Annuities grow tax-deferred, so you don’t pay taxes on interest or gains until you withdraw. For high-income earners who’ve maxed out 401(k)s or IRAs, annuities can be an additional tax-efficient savings vehicle.

Diversification from Traditional Portfolios

Annuities add a non-correlated asset class to portfolios. Many retirees use them to reduce sequence-of-returns risk (the danger of withdrawing during market dips) by using annuity income instead of selling volatile assets.

Behavioral and Emotional Benefits

People value peace of mind and predictability:

Knowing bills are covered by a stable income stream helps people feel more secure.
It reduces the pressure to micromanage investments later in life.

Legacy and Estate Planning

Some annuities offer death benefits, helping pass money to heirs without going through probate, or providing long-term care riders to protect against medical expenses later in life.

If you’re considering one, it’s important to:

Understand the type of annuity (fixed, variable, indexed, immediate, deferred).
Watch for fees, surrender charges, and liquidity restrictions.
Align it with your overall financial plan and risk tolerance.

Conclusion: Are Annuities Right for You?

Annuities aren’t for everyone. Fees can be high, contracts may be complex, and liquidity can be limited. But when chosen wisely and as part of a well-diversified retirement strategy, annuities can be powerful tools for income stability, longevity protection, and financial peace of mind.

They’re not just insurance products—they’re instruments of security in an uncertain financial world. That’s why, for many, annuities stand among the best financial products available today.

If you’re considering an annuity, it’s crucial to work with Annuity Pros to evaluate your goals, time horizon, and the specifics of each product type. The right annuity, used the right way, can make all the difference in your financial future.

Individuals and businesses who would like to connect with Annuity Pros can get in touch instantly via our enquiry form.

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Protecting your legacy

Sat, 01 Feb 2025 05:49:00 -0700

Protecting your legacy

Many parents hope to leave a parting gift for their children after they’ve gone. But how can you be sure they will use their inheritance the way you intended?

Protecting children from mismanaging their inheritance is one of the top three pressing concerns of people seeking estate planning, according to a recent survey.

These simple strategies from can help address your concerns and ensure that the funds you leave behind will be used wisely.

Q: What are the primary reasons someone would want to delay or restructure an inheritance?

A: Some people are concerned that their heirs will not make good financial decisions if the inheritance is collected all at once. Others want the gratification of knowing they are contributing to a certain event in their children’s or grandchildren’s lives (for example, putting money toward a college education or milestone birthday). And in many cases, it is because they have a child or grandchild with special needs.

Q: What solutions do you typically recommend?

A: There is never a set solution. Each client's situation is different. But I would discuss establishing trusts and looping in an estate-planning attorney to make sure the assets are dispersed the way the grantor intends them to be.

Q: Suppose I want to specify exactly how my inheritance should be used or distributed, or protect it from ending up in the wrong hands. How would I do that?

A: There are a few ways. Some cases require an attorney or financial advisor. Depending on the value and complexity of the estate, a lot of times a trust will be needed. Sometimes solutions can come from the financial product alone, like an annuity. This is possible because the financial product is beneficiary friendly, meaning the client can assign how and to whom the assets will pass upon their death. The options are so detailed that even if the grantor outlives any of the beneficiaries the grantor themselves can choose how the deceased beneficiary’s share will be decided—whether it stays in the passed beneficiary’s bloodline, or gets shared among the still-living original beneficiaries.

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Estate planning 101

Sun, 01 Dec 2024 05:41:00 -0700

Estate planning 101

Having a smart estate plan is essential for everyone—regardless of assets, age, or income. Here's what you need to know to build yours.

You might think estate planning is something you can put off until your later years, or that it's just for the super wealthy, or both. But setting up a clear path for what happens to your property and your family after your passing can make life for your heirs much easier in a time of stress and grief. That's where an estate plan comes in.

"It's your chance to really take control of how your property is going to pass upon your death," says Kelley Bentley, a Houston-area attorney with Roberts Markel Weinberg Butler Hailey PC.

Here's what you need as part of a solid estate plan, no matter your assets, age, or income.

Will

This basic legal document will set up who will get what—without having the state step in and make those decisions, which is often a headache for your heirs and can cost them more money in the long run.

A will is especially important if you have minor children and are a single parent, says Bentley. If you don't do any planning for your children, they have to go into a guardianship, which can be traumatic, while the legal system sorts out who your children will be living with in the future. Plus, a judge may decide on a guardian you'd never have chosen yourself. By having a will in place that states who your children's guardians will be in case something happens to you, you can ensure that they will be raised by whomever you see fit.

Trust

A trust can do a couple of important things. First, it means your estate will not go through probate, a process that can delay assets being passed on to your heirs. This is especially helpful if you hold properties in more than one state, says Bentley, as your estate would be subject to separate probates in each state.

A trust can also be set up for special needs or minor children. It will determine how the assets they inherit will be used to support them, who will make those decisions, and when the children can take over that fund themselves, if ever.

Powers of Attorney

If something happens to you and you can't make decisions for yourself, who will be in charge? Who will make sure that your bills are paid and that medical decisions are made with your best interests and wishes in mind? Bentley says that your estate should determine who holds your medical and financial powers of attorney. Keep in mind that those roles may be held by two different people.

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What is variable universal life insurance?

Fri, 01 Sep 2023 05:00:02 -0700

What is variable universal life insurance?

Variable universal life insurance is a type of permanent protection that offers flexibility and the potential for growth by investing some or all of your cash value in subaccounts that are tied to the stock market — similar to how mutual funds are structured.

What does it offer?

In addition to lifetime protection, variable universal life insurance offers a unique combination of benefits to help meet your needs, including:

Enhanced growth potential

A variety of high-quality investment options mean the potential to earn a higher-than-average rate on your cash value accumulation.

Supplemental retirement income

If you’re already making the maximum allowable contributions to your qualified retirement funds, a variable universal life policy offers you the potential to build additional savings for retirement.

Tax advantages

All life insurance products offer tax advantages, including a tax-free death benefit and tax-deferred cash value growth to help you make the most of your investment.

Policy customization

You can customize a variable universal life policy with a variety of optional features for an additional charge, including the Long-term Care Rider.

How does variable universal life insurance work?

A portion of your flexible premium payment goes toward the insurance, which includes any fees and death benefit coverage.

The remaining premium goes into a tax-deferred savings account, with the opportunity to invest that cash value into subaccounts.

Who may benefit from variable universal life insurance?

Variable universal life insurance is designed for people who:

Are looking for a permanent life insurance policy that has the potential to accumulate cash value
Want more variety and control over their investment options
Prefer the freedom to monitor and make decisions on where to allocate their funds over time
Understands that investing involves rewards, but also risks that may have the potential to reduce the policy’s cash value.

Could variable universal life insurance be right for you?

See how it compares to other types of life insurance (e.g., variable universal life vs. whole life) to get a better idea of whether it meets your needs.

Individuals and businesses who would like to connect with Annuity Pros can get in touch instantly via our enquiry form.

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Whole life insurance in depth

Tue, 01 Aug 2023 05:00:02 -0700

Whole life insurance in depth

What is whole life insurance?

Unlike term life insurance that protects you for only a specific duration, whole life insurance offers protection throughout your lifetime.

It’s the most basic type of permanent life insurance that offers consistency along with some predetermined, guaranteed cash value growth.

What can it offer?

In addition to lifetime protection, whole life insurance offers a unique combination of benefits to help meet your needs, including:

Consistent premium payments

Whole life insurance is typically more expensive than term life policies, but the premium amount is fixed for the life of the policy.

Consistent cash value growth

Your whole life insurance policy receives guaranteed cash value growth.

Tax-free death benefit

The payout your beneficiary receives if you die is typically tax-free and has a steady value throughout the life of the policy.

Policy customization

You can customize a whole life insurance policy with a variety of optional features for an additional charge.

Your premium payments remain the same over the life of the policy, and a portion of it goes toward the insurance, which includes any fees and death benefit coverage.

A small amount from each payment is also set aside to build up your predetermined, guaranteed cash value.

With this policy, you can borrow against the cash value if needed. When you pass away, an income-tax free death benefit is paid to your beneficiaries. Keep in mind that borrowing against the cash value will reduce the death benefit paid to your beneficiaries, though.

Who may benefit from whole life insurance?

Whole life insurance is designed for people who are looking for:

A policy that lasts your whole life
Premiums that stay consistent over time
A guaranteed, tax-deferred cash value with a fixed rate of interest over time

Could whole life insurance be right for you?

See how it compares to other types of life insurance (e.g., whole life vs. term life) to get a better idea of whether it meets your needs.

How to buy whole life insurance

You need to work with an insurance professional at Annuity Pros to buy this type of product.We are here to help.

Individuals and businesses who would like to connect with Annuity Pros can get in touch instantly via our enquiry form.

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Universal life insurance in depth

Sat, 01 Jul 2023 05:00:00 -0700

Universal life insurance in depth

In addition to lifetime protection, universal life insurance offers a unique combination of benefits to help meet your needs, including:

Plan flexibility

You can change the protection level, how frequently you pay your premium or even the premium amount, as long as you remain within set boundaries.

Access to the cash value

If your needs change, you have the potential to build and borrow from the cash value while you’re alive.

Long-term care coverage

You have options for covering potential long-term care expenses — for help with things such as bathing, dressing, eating, food preparation and household cleaning.

Tax advantages

All life insurance products offer tax advantages, including a tax-free death benefit and tax-deferred cash value growth.

How does universal life insurance work?

A portion of your premium payment goes toward the insurance, which includes any fees and death benefit coverage.

The remainder of your premium payment adds to the policy’s cash value, which you can withdraw or borrow against.

There are several types of universal life insurance products, and the cash value growth rate in your policy — either a fixed rate set by your insurance company or a rate based on the performance of market indexes — will depend on the product you select. With a universal life insurance policy, you have the ability to withdraw or borrow against your cash value. If you pass away, the income tax-free death benefit will be paid to your beneficiaries.

Who may benefit from universal life insurance?

Universal life insurance is designed for people who are looking for:

Protection for your family in case of your premature death
Potential cash-value growth with tax advantages to use for things such as supplemental retirement income
Built-in flexibility, in case something happens and you need to adjust your premium or death benefit value
Options for covering long-term care expenses
A way to transfer wealth to future generations in a tax-efficient manner

Could universal life insurance be right for you?

See how it compares to other types of life insurance (e.g., universal life vs. whole life) to get a better idea of whether it meets your needs.

Indexed universal life

Cost-efficient death benefit protection with the potential for cash value accumulation that you can use to help meet a variety of planning needs.

Can offer permanent life insurance that’s designed to help protect your family today and enhance your cash value growth potential for the future

May provide cost-efficient death benefit to help assure a good value for your money, along with potential of cash value growth so you can plan for the future with confidence

Guaranteed universal life

Affordable, guaranteed protection that can be customized to meet your needs today, while still being flexible enough to evolve as your needs change.

Survivorship universal life

Permanent life insurance on two people that helps protect your family by paying a death benefit when the second insured passes away.

Linked-benefit universal life

A universal life insurance policy and long-term care coverage in one hybrid policy.

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What is life insurance?

Mon, 08 May 2023 08:14:36 -0700

What is life insurance?

Life insurance policies help provide security to either you or your beneficiaries after you pass away or after a designated period of time. With a life insurance policy from Nationwide, you can help secure your family’s financial future by paying for college, paying off a mortgage, covering any final expenses or estate taxes, and more.

Types of life insurance

There are two main types of life insurance:

Term life insurance and permanent life insurance. Term life insurance simply covers you for a specified amount of time (10-, 20- and 30-year policies being the most common).

Permanent life insurance can be broken down into three types: universal, whole and variable. You can use this tool to get a better understanding of which type of life insurance is right for you.

Common life insurance questions

Who needs life insurance?

Generally speaking, if you have dependents or are married, your family can benefit from you having a life insurance policy. Life insurance offers peace of mind by ensuring that your loved ones will be taken care of in the event of your untimely death. Plus, payouts are tax-free.

Why should I get coverage now?

Rates tend to go up as you age. Buying a policy when you’re younger lets you lock in a lower rate.

How much life insurance do I need?

This depends on what you want to leave when you’re gone. There are two common methods for calculating the amount of life insurance you need: lump sum and income replacement. You can use Annuity Pros enquiry form below to get an understanding of how much life insurance you may need.

How much does life insurance cost?

The cost of your life insurance policy is dependent on a variety of different factors, ranging from your age, gender, location, and health. You can use a term life insurance tool to get an idea of what life insurance may cost you.

What is term life insurance?

“Term” refers the length of coverage that you choose. If you pass away during the term (usually 10, 20 or 30 years), your beneficiaries receive a cash payout.

Why is term life a good option?

With term life insurance, you’re only paying for the years where the need is greatest (when your kids are younger or in college), and it is usually the most affordable type of insurance.

Is my policy through work enough?

Life insurance through your employer is not portable, so it won’t come with you if you leave the job. Also, the amount is often not enough to meet people’s protection needs.

What is permanent life insurance?

Permanent life insurance falls under three types of policies: whole, universal, or variable. These policies cover your entire life and usually build cash value over time, but tend to be more expensive than term life insurance.

Individuals and businesses who would like to connect with Annuity Pros can get in touch instantly via our enquiry form.

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