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Planning Ahead: A Look at the Market for Selling Annuity Payments

Nov 23, 2013

Annuities are great purchases; they ensure that the insurance company from where you purchased them will support the later stages of your life with periodic cash influxes (which you already paid for when you were younger). Annuities are great for those who want greater financial security far into the future.


However, there are times when a person with an annuity program needs cash as soon as possible. One of the most viable options for such a person is to sell his annuity payments in order to get cash immediately. A Market Watch article details the potential of selling off annuity to a second market:


The secondary market annuity category is somewhat of a finite asset class with only 600 million to over a billion dollars of inventory typically available each year. More and more investors are learning about and participating in this niche sector, which is actually starting to affect yields and raise prices due to increasing demand.


Most secondary market annuities can provide a higher yield (usually 0.50% to 2.00%, or more) and a larger contractual payout than what's available from a new issue standpoint — and the buyer can choose the terms and carrier ratings to match their specific objectives.


The growth of the market can only mean good things towards annuity holders who want to sell off part (or the entirety) of their annuities for immediate cash. As demand for second market annuities develop, the number and pricing of the annuities sold on the market is bound to increase, creating a more competitive and healthy annuity market.


People who will want to cash in on this trend, however, need to learn about the nature and worth of their annuity, as these factors will play a vital role in determining the pricing of the annuity, or if the policy is transferrable at all. It is also important for the buyer of the annuity policy to be hand-picked from the crop out there. Buyers have different agendas and different modes of payment, so it pays to pick the right buyer.


Selling your annuity payments is a rising trend that cannot be missed out on. People interested in learning more about selling their annuities can consult professionals like Granoff Enterprises who specialize in liquidating such investments.


(Article Excerpt and Image from Secondary market annuities boast higher yields, Market Watch, October 29, 2013)