Annuities and The Bible

For I know the plans I have for you” declares to LORD,:” plans to prosper you and not tot harm you, plans to give you hope and a future.

Jeremiah 29:11

Annuities. Have you heard of them? Maybe you have, but based on a quiz that was given, older Americans struggle to understand this financial concept. Therefore, fewer people are buying them. Those that took the quiz scored an average of 12% out of a possible 100%.[1] This assessment drew on knowledge from Medicare, life insurance, and long-term care. Annuities were the least understood.

What are they? Annuities are considered “reverses life insurance”. The result of living too long, and, therefore, needing an income for life. They are considered tax deferred. They are typically funded by life insurance companies as well. Annuities are fixed, predictable payments made at regular intervals over multiple years.[2] Social Security and Pensions are both familiar annuities. However, only 10% of Americans own a commercial annuity. The typical owner is upper- middle class.

What do they do? Annuities help diversify one’s portfolio greatly. They add preservation and limit risk in comparison to other investments. There are different kinds of annuities for varying risk levels: fixed, variable, and equity indexed. A fixed annuity has a guarantee that your original investment cannot be lost. There is a minimum on interest as well, so these are the least aggressive in terms of risk. These are typically invested in mortgage & interest accounts. As for variable, these are typically invested in stocks and bonds where the owner decides on where they will be held. A middle ground of these two: the equity indexed annuity. Providing a safety-net of a guarantee like the fixed but following a certain index like S&P 500. Unlike IRA & 401K accounts, there is no limit to how much you can contribute. There are different options for the annuitization payout: you can have It for life-only, life- refund certain, life-period certain, and joint-life & survivorship. Talk to a financial advisor about which option is right for you.

Just as Jeremiah 29:11 reassures us with the promise of a hopeful future, annuities serve as financial instruments that help provide a sense of stability for our tomorrows. Through careful planning and investment, we can navigate life’s uncertainties with more confidence, knowing that we have diligently prepared for the days ahead. As we journey forward, let us remember the wisdom of Jeremiah’s words and the prudence of financial planning, trusting in both divine providence and sound financial strategies to help guide us towards a prosperous tomorrow.

[1] Visé, Daniel de. “Annuities Are Key to Retirement. so Why Are so Few of Us Buying Them?” USA Today, Gannett Satellite Information Network, 1 May 2024,

[2] “Annuities for High-Net-Worth Individuals: Strategies & Tips.” Annuity.Org, 13 Mar. 2024,

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