What Happens When My Annuity Matures?
When an annuity matures, it signifies the end of the accumulation phase and the beginning of the distribution phase. This is when you will start receiving payments based on the terms outlined in your agreement with the insurance company.
Options Available at Maturity
- Guaranteed Payments: You may choose to receive regular payments for a fixed period or for the rest of your life, depending on your annuity type.
- Lump-Sum Withdrawal: Some annuities allow you to withdraw your funds in a lump sum, but this may result in tax implications.
- Partial Withdrawals: You might also opt for partial withdrawals while keeping the remaining balance invested.
- Transfer to Another Annuity: You can potentially transfer your funds into another annuity without incurring taxes.
Considerations
Before making your choice, consider factors such as your current financial needs, tax implications, and your long-term retirement strategy. Consulting a financial advisor may help you make an informed decision that aligns with your retirement goals.
Conclusion
Understanding your options upon maturity can significantly influence your retirement income strategy. Always review the terms of your annuity and consider your future financial requirements.