If you are not sure what an annuity really is, it is an investment in your future. Basically, you just pay a certain amount in monthly payments to your insurance company that you will get a return on later on. You get to determine how long you will be paying for and when you want to surrender it. Most people invest in annuities for retirement or to help them buy major things like homes etc. You can invest in annuities whenever you would like and for however long you would like. Usually the annuities begin at a 5-10 year term. Some people will opt to sell their annuities so that they can get money now; while the buyer pays cash now and gets the returns on the annuity later. A lot of the time, the buyer will continue to pay the monthly payments on the annuities in order to get a better return. This is better for the seller because they will not get charged penalties etc. and the buyer will get more money back when the annuity contract is over so both sides win. When you decide to sell your annuity, you must ask yourself these key questions first: Should I sell it on a full payment? (Selling the remainder of your payments for a discounted lump sum) Should I sell it on a partial payment? (Selling a certain number of future payments at a discounted lump sum) Should I sell it on a deferred payment? Should I sell it on a shared payment? (Selling a part of future payments at a discount and keeps the rest of the payments to themselves) People who are selling their annuities are usually holding a structured settlement and are looking for a faster payout than what the settlement offers. This also occurs with lottery winners. People choose to sell their annuities for a variety of reasons, but most often it is because they need or want cash fast. For example; a person might consider this if they have major medical bills to pay etc. Sometimes it can be a real hassle to sell your annuities for a discounted price because you end up taking a full or partial loss on your investment; however, many people do wind up taking up this option out of necessity. My suggestion if you are planning to sell your annuity is to first ensure that you will get the best deal possible on your money. For example, if you are selling a structured settlement from your insurance company after an accident, you want to find a company or buyer that will give you a good deal on the annuity. You so not want to end up accepting $10,000 on a $50,000 structured settlement just because you didn't know any better. That is a lot of money. Research the buyer or company that you go through and ask around for good quotes to make sure that you get the best deal that you can before selling.
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