You Can Withdraw Funds from Annuities Free of Surrender Charges in Certain Situations

Are you interested in annuities but are put off by the hefty surrender charges? Are you worried about what will happen to your annuity if you need long term care? Liquidity of funds is a major concern for those who are considering an annuity purchase. Many annuities have built in riders that allow the holder of the annuity to convert the policy into cash, without paying the surrender fees, in the event of a terminal illness diagnosis, long term care confinement, hospitalization or unemployment. If you are interested in annuities but are unsure about surrender fees and how much can be withdrawn and when, contact an Annuity Specialist at AnnuityAdviceOnline.com. Our Specialists have complete information on hundreds of annuities.

Many people believe that once you purchase an annuity, your money is locked up for good. And it is true that insurance companies do charge surrender fees for withdrawals made before the term’s end. These charges are to ensure that an annuity owner keeps holding the annuity, allowing the insurance company to offer higher-than-average interest rates. However, your money is not untouchable. You can withdraw the money and pay the surrender charges. With most annuities, you can take out 10% of the annuity’s value per year without penalty. Also, some annuities offer the option to withdraw your interest earnings each year.

Unfortunately, bad things sometimes happen and being able to get to the money invested in an annuity may be integral to dealing with a negative situation. Terms are different for each annuity, so making sure that the surrender terms are crystal clear is important before purchasing annuities. In the case of a terminal illness or hospitalization, the condition must be fully documented by a licensed physician and submitted to the insurance company for the annuity to be surrendered. If unemployment is the case, you typically must be unemployed for at least 30 days and be under the age of 65. Annuity owners who are confined to a nursing home for more than 60 days can generally cash out their annuities without incurring surrender fees.

To learn more about surrender charges and to see what surrender provisions affect your annuities, contact the Specialists at AnnuityAdviceOnline.com at 1-888-837-4226.