Forgot your password?

Changing Whole Life To Annuity

By Edited Nov 13, 2013 0 0

Many people may wonder if changing whole life to an annuity would be the best option for them. Saving towards financial security for the future is something everybody should do. Everybody wants to be independent in their senior years, while being comfortable, as well. Although there are many options for people to choose from to help build financial security, the two most common ways are through whole-life insurance and annuity plans.

Many people may wonder what the difference between whole life and annuities is, and which one would be the best option for saving for the future. Some people may wonder if they should change from a whole-life policy to an annuity or vice versa. Following is an explanation of each that may clarify these questions.

Most everybody knows that life insurance protects the insured's family in case they die. When people purchase life insurance, their family will have the finances they need to cover the insured's funeral expenses and, in some cases, their debts. The plan may even be able to support the insured's family for some time after they die depending upon the amount of coverage they purchase.

Whole life differs from term life in that whole life builds cash value that the insured persons can borrow against in times of need. Term life does not. Whole life also protects people for their entire lives, while term life only protects them for a set time frame, at which time people will need to purchase new policies.

Annuity plans, on the other hand, are quite opposite of life insurance plans. Annuity plans give people some form of financial support when they retire and cannot work any longer. People may also choose to use their annuity payments for any medical bills that may accumulate as they get older.

Unlike life insurance, which people can purchase so long as they are at least 18, people need to be between 55 and 70 to purchase annuity plans. The closer to the age of 70 people are when they purchase annuities; the bigger their payments will be, and they may also get larger payments if they have any preexisting medical conditions when they purchase annuities.

In closing, people may still be wondering what would be the better option for them-whole life insurance or annuities. Basically, it all depends on each person's unique needs and the circumstances in which they are living. However, if people are under 55, they are better off purchasing a whole-life insurance policy for the time-being. For those people, who are retired and over 55, the best option would probably be changing whole life to an annuity.



Add a new comment - No HTML
You must be logged in and verified to post a comment. Please log in or sign up to comment.

Explore InfoBarrel

Auto Business & Money Entertainment Environment Health History Home & Garden InfoBarrel University Lifestyle Sports Technology Travel & Places
© Copyright 2008 - 2016 by Hinzie Media Inc. Terms of Service Privacy Policy XML Sitemap

Follow IB Business & Money