Understanding the annuities historical rate of return is important for anyone that owns annuities and wants to know how much they can expect to get back from any investments.
With annuities, there are different ways to receive funds. There are the annuities that allow an individual to obtain a set amount of funds for the rest of their lives. There are also immediate lump sum annuities that allow an individual to receive all their funds up front. When you choose to have your funds paid out to you over a specified amount of time, the annuity generally pays a rate of return that makes such an arrangement profitable as you will receive some form of interest or other additional cash flow from the annuity.
The Convenience of Annuity Tables
Anyone who is interested in finding out about an annuities historical rate of return need look no further than an annuity table. This table allows you to determine how much you will be able to receive from you annuity on a monthly basis.
These tables take into consideration such details as the amount of the annuity, the type of annuity and age of the annuities. By looking at the data on the annuity tables for any annuity you are considering, you can determine how much money you will earn over a period of time.
Depending on the type of annuity you own, the rate of return earned will vary. Annuity tables allow you to determine just how much you will receive from a particular annuity over a certain length of time. For example, individuals who are interested in obtaining information on how much will be received on monthly annuity payments that have been made over a course of 5, 10, 15 or even 20 years can use these tables to determine their rate of return.
Determining an Annuities Historical Rate of Return
An annuities historical rate of return is a calculation that demonstrates the amount of money that is either lost or gained as a result of an investment. The money that is invested is usually referred to as an asset or capital. The loss or gains are sometimes referred to as net income or net loss.
It is very important to understand how to use annuity tables to determine how much you are earning or losing from your annuity over the course of a couple of years. It is also very important for people with annuities to understand the rate of return to evaluate whether or not the annuity is profitable or if the annuity is a financial loss. You can look at the table to determine the annual amount of money earned over the years, and then use that to determine the historical rate of return.
With annuities that have a guaranteed rate of return, individuals can monitor the return rates on a regular basis in order to determine if they are indeed receiving the guaranteed rate that was promised. Anyone who has an annuity should make themselves very familiar with the rate of return figures.
Types of Annuities and Rate of Return
There are different types of annuities that have different rates of return. There are two main types of annuities.
- Immediate annuities are described as an insurance policy that guarantees that a certain amount of money will be paid out by the issuing party. With this type of annuity, the payments that are made are usually set at a fixed rate so you usually don't have to worry about your funds fluctuating and you can be confident you will have a guaranteed rate of return on your investment. There are many people who prefer this type of annuity because they know what their funds will look like month to month.
- Deferred annuities, on the other hand, have different options for investing, such as generating interest only earnings. These types of annuities can create great profits and losses because the rate of return will fluctuate based on the interest rates or other factors. People who are willing to take risks for large returns may enjoy this type of annuity option.
If you are interested in finding out information regarding the historical returns for a particular annuity, such as how a particular annuity product has performed in the past, request this information from the insurance company issuing the annuity.