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What to look for in an annuity

Look for low-cost, single-premium life income annuities. An immediate annuity will begin payouts within 12 months; a deferred annuity will begin paying at a later date.

Make sure you’re comparing apples to apples. That means getting multiple quotes for annuities offering the exact same terms.

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Price out the options. See how income payments change if you buy a joint-life instead of a single-life annuity. Then run the numbers for inflation-adjusted products and those that guarantee a minimum 10-year payout.

Don’t buy all at once. And don’t be afraid to diversify your portfolio by buying annuities with different features at different times.

Remember, annuities — like FDIC-protected bank accounts — are guaranteed. In Massachusetts, that protection is limited to $100,000 of the present value of ­annuity benefits per person per insurance company.

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