How An Enhanced Annuity Can Benefit You In Retirement
An Enhanced Annuity is a scheme that pays you extra income if your health is bad
. It is essentially income for a lifetime designed for those who suffer with medical diseases, take prescription medications, or need hospitalization. You can also qualify for a higher rate when specific lifestyle issues apply.
Lifestyle issues pertain to factors that do not fall into the category of poor health. Certain aspects of your lifestyle will be taken into account. Let's take smoking and alcohol as examples. You will have to honestly reveal how much you smoke and if you consume more alcohol than is considered average. Other factors are weight issues such as obesity, what type of work you used to do, and if there was the risk of danger involved during your job.
If you are a heavy drinker, smoke a lot, or are obese, these are all factors that can reduce your life expectancy. In the case of a combination of these, your life expectancy is likely to be even lower. For example, if you are obese and you drink and smoke heavily. The shorter your life expectancy is, the higher your income. The logic behind this is that the payments will only be made for a short period of time.
Someone who smokes regularly may qualify for 33 percent higher income, while a person who drinks heavily could qualify for 10 percent higher income. Someone who has been medically classified as obese may also get 10 percent higher. These figures may vary and each individual case will need to be assessed in order to receive the maximum benefits. Lifestyle issues can make a substantial difference to your income when you retire.
With an enhanced annuity, you get a better rate than a standard annuity scheme. The reason for this has already been mentioned, i. E. Lifestyle habits and medical conditions that affect life expectancy. This does not become a factor for people in good health. The insurance carrier is able to afford to pay more because it will be for a shorter period of time. If you are on the brink of retirement, check this out because you may well qualify for an enhanced rate.
Even minor health impairments will be considered so it's well worth looking into. You may be retired for many years and the higher rate can make a big difference to your financial security. For you, it is a low-risk option because the policy guarantees you a regular income for the duration of your life.
There are more than 1500 medical conditions that can qualify for enhanced rates. These are too numerous to name individually in this article. Some common ones, however, are arthritis, Alzheimer's disease, high blood pressure, asthma, cholesterol, certain cancers, heart disease, diabetes, DVT (deep vein thrombosis), kidney problems, organ transplants, liver disorders, leukemia, rheumatism, and Parkinson's disease.
People who suffer with more severe cases of ill-health are catered for by an Impaired Life scheme which is basically the same as an Enhanced Annuity, except that the income is even higher. The reason is that life expectancy is even shorter. Many retirees are not aware of these types of policies and, in fact, it is estimated that about 40 percent of senior citizens would qualify for such benefits.
by: Lance Thorington
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