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It depends upon which kind of annuity you've. In the event you select a fixed-rate annuity, you're not accountable for selecting the investments – the insurance coverage business handles that job and agrees to spend you a pre-determined fixed return.

Whenever you go for a variable annuity, you determine how you can invest your cash within the sub-accounts (basically mutual funds) provided inside the annuity. The worth of one's account depends upon the overall performance from the funds you select. Whilst a variable annuity has the advantage of tax-deferred development, its annual costs are most likely to become a lot greater than the costs on normal mutual funds – so ordinary funds might be a much better choice.

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