Assured Annuities (secondary market fixed payments) are generally among the best examples of stable investments that can potentially be made to meet financial goals. Whether you are considering goals that are long term – such as saving for retiring – or more short-term, in-force annuities do have some real advantages for the buyer. These types of investments have become quite popular in recent years due to this general stability, particularly in a market where stability oftentimes seems to be in short supply.
What Makes them Stable?
The in-force annuities that are sold on the secondary market are paid by companies that have anywhere from an A to a AAA rating with Standard & Poor’s. These are insurance companies that are paying the annuities either as a result of a settlement or, in some cases, the payments may actually be made after somebody won the lottery, which is a common arrangement. These payment streams are set to pay off over a set number of years and that makes them relatively stable. Between the money being owned by an extremely reliable company and there being the assurance that it will be paid off in a fixed number of years, these can be added to a portfolio to meet specific financial goals.
Using Assured Annuities
Obviously, with this type of stability, one of the most popular uses to which these financial instruments are placed is in a retirement portfolio, where they add much-needed stability. Over a given amount of years, a specific amount of money can be guaranteed to be added to the portfolio, creating a great deal of peace of mind for the portfolio owner.
Another common usage for these is to meet shorter-term financial goals. For instance, somebody approaching or past the age of 50 may very well be looking at paying for their adult children to go to college. Assured Annuities are great ways to meet this obligation. Because a certain amount of money is guaranteed to be paid out by the annuity over time, it’s easy to budget for school and, potentially, one of these annuities could pay enough money to pay for school and return a handsome profit, on top of it.
The payment streams are sold with interest rates fixed to them. This allows the buyer to determine exactly how much of an investment they want to make and how much of a profit they need to make to justify that investment to them. For setting short-term financial goals, this is an ideal instrument, as it provides a fixed amount of money that the buyer?can count on being available after a certain amount of time.
For buyers who are looking for something relatively stable, understandable and generally reliable, in force structured settlement payment streams provide excellent options. They are great for meeting specific financial goals and, unlike most investments, they can actually provide a guaranteed return, which provides tremendous stability for the buyer and a great deal of flexibility in terms of how other investments added to the portfolio can be chosen, given that there is one so stable that can act as an anchor.