 What is an Annuity?
An Annuity is a contract between a purchaser and an insurance company, under which the purchaser (you) makes a one time payment or series of payments. In return, the insurer agrees to make periodic payments, that either start immediately or start at some future date.
When you sell annuity payments now, you are choosing to receive the money now instead of waiting for the future payments.
Annuities are often purchased as investments, and are usually either "fixed" or "variable."
• In a fixed annuity, the periodic payments will be a guaranteed amount. These payments may last for a definite period, such as 20 or 30 years, or an indefinite period, such as your lifetime or the lifetime of you and your spouse.
• In a variable annuity, the buyer can choose from a range of different investment options, and the amount of the periodic payments can go up or down, depending on the investments.
Some annuities, instead of being the result of an investment, arise from a settlement, or from an award such as winning the lottery. Depending upon your annuity, you may decide that you would prefer to have the cash for annuity rather than the monthly payments.
Even though some annuities specify that they are "irrevocable" and cannot be cashed in, Novation Capital may be able to buy your annuity and pay you cash. And the value in today's dollars, or the uses to which you can put the money today—including other investments—may make it worth your while.
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