Elaborate on the basics of annuities and payouts
What will be an ideal response?
Answer: A single life annuity allows you to receive a set monthly payment for life. An annuity for life (with "certain period" provision) also pays for life. In addition, if you die within the set period (usually 10 or 20 years), your beneficiary will get the payments until the end of the period. This option provides a smaller payment. A joint and survivor annuity provides payments over the life of both you and your spouse. None of these options allow for any inflation protection or flexibility in payouts.
A lump-sum option gives you your benefits in one single payment. It is great for inflation protection, emergency funds, access to large sums of money, and investing in other endeavors. You can roll over the lump sum into an IRA or qualified plan. The dangers are a high tax bill and spending too much of it.
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In a relation, the sequence of columns can be interchanged without changing the meaning or use of the ________
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