X
    Categories: Retirement

Do You Want a Fixed Annuity or a Life Annuity?

This is the same type of annuity in Canada, although some people feel there are differences.

In Canada a life annuity is sometimes referred to as a fixed annuity as the payment is “fixed” or “settled”. The confusion arises when you think of annuities with a yearly time element.

For instance a 10 year term annuity is a “fixed annuity” but here the phrase refers to a time element; it is payable for a certain number of years only.

So the next time someone asks you about a fixed annuity, ask him or her if they are referring to the amount of the annuity payment or the number of years in a term annuity.

And you need to be aware of variations. Most life annuities carry two guarantees

1. a lifetime payout and

2. a guaranteed payout for a number of years. So here we have a life annuity with a “fixed” or guaranteed number of payments.

Posted by: Phil Barker: Phil is a leading expert in life annuities in Canada. His website Life Annuities.com is a recognized authority on annuities. Recently, he's been redefining how annuities are sold in Canada.