Before buying annuities you may have lots of doubts about it. So let us quickly go through the some important points you should know about annuities,
Some Points about Annuities
1. The entry age for annuities is 18 years minimum and 80 years is maximized.
2. You need to be an Indian resident to buy annuities.
3. You can also buy life insurance covers with annuities.
4. Annuities are priced based upon its features, current interest rates and prevailing economic conditions.
5. In case of deferred annuities - the amount you get on retirement that is after completion of your accumulation phase only 1\3 of it can be withdrawn without paying any taxes. 2/3 of the amount has to be reinvested back into annuities.
6. Income from annuities is taxed according to your tax slab.
7. Investment in annuities in the accumulation phase that is before your retirement can be claimed for tax reduction and the overall limit of the section 80C.
8. All insurance companies sell deferred annuities, there as many of them sell immediate annuities.
9. Increasing Annuity options are available which try to match inflation up to a certain extent.
10. Premature closing of annuities is possible with a penalty which varies from insurer to insurer. Annuities carry high surrender charges in initial years.
Read: Save the Tax, What is annuity
Read: Save the Tax, What is annuity
Friends, in this article you have read some important points about annuities. Hope this article gave a fair idea about annuities.
