In the wake of economic meltdowns that have affected the stock market recently, many people who had relied on their stock investments are now realizing the security offered through annuities.

People who had numerous stock options they were relying on for retirement have seen them washed away with the tide. Annuities, on the other hand, aren’t as risky. They guarantee a continual level of income in retirement and are backed against downturns in the market. Annuities are contracts through insurance companies that provide guaranteed income streams through the life of the holder. They provider safer alternatives for investors worried about market conditions or low returns on bonds.

There are two types of annuities, including an immediate annuity that pays similar to a pension, and a deferred annuity, which allows users to invest money on a tax deferred basis. Although deferred annuities are dependent on the stock market for their performance, there is usually insurance available to hedge against the investment taking a loss. Buy annuity, and you are taking a considerable lower risk than just investing money in the market.

Until recent changes, the one catch when you used to buy annuity was the fact that you might be stuck with it. You’d face high taxes and stiff penalties if you choose to sell the annuity. Luckily, over the last several years, selling annuity has enjoyed a growing market.

Sometimes people consider selling annuity because they don’t need the consistent payments anymore and would prefer to take the money in a lump sum and invest it. Being able to sell the annuity makes it as good as cash, which can be an appealing asset. This fact continues to push the demand for annuities in the marketplace.

Any annuity is salable, except for those held in 401K and IRA accounts. If it turns out you don’t need the entire annuity, you can also sell part of the annuity. The resulting cash can either be used to purchase life insurance or other investments.

Check how the gains will be calculated with the annuity. Also, watch for any hidden penalties for early withdrawals. Older people should also watch out for any rules that might prevent the money from being accessed for several years.

Annuity offers a more sound investment in the wake of the meltdown of the stock market. Market conditions have created an even greater demand for those who want the security they offer, so they can easily be traded as valuable commodities. Annuities enjoy a strong security in the wake of these difficult times.

It’s a fact that IRAs and employer sponsored plans are the best ways to plan for retirement, but they have their limits, mainly in the amount you can invest in them. You’ll likely want to enjoy a similar quality of life after you retire, and the last thing you want to worry about will be your budget.

But if you invest in an annuity, retirement finances don’t have to have a cap. Long after your investments to IRAs and 401Ks have been maxed out, you can continue to buy annuities, ensuring a steady amount of cash flows to your bank account throughout your life.

Many people face retirement worried that they’ll outlive their savings, with good reason for concern. If your 401K runs out or IRA gets depleted, where will you turn? What if that income simply isn’t enough? With an annuity, retirement payments will keep coming in, no matter how long you live.

That’s probably why nearly 10 million people facing retirement today are purchasing annuities. It’s a reliable flow of income that you can depend on or just save as a nice safety cushion of savings for unexpected expenses you might face in your retirement.

Of course, there’s always the possibility you’ll end up better off financially than you planned. Maybe you’ll have more than enough savings to live comfortably, and prefer the annuity in a lump sum in order to invest in a dream home or buy a boat. Just a few years ago when there was no market for it, you’d be stuck with that annuity. Sell an annuity would have been previously impossible. You were pretty much stuck with it.

The rules on annuities have changed. A secondary market for annuities is steadily growing. If you no longer want that annuity, sell it. In fact, new annuity sales now top $200 billion a year. Annuities can now commonly be sold in asset-backed securities, typically sold to big institutional investors.

It’s possible you’ll prefer the money in a lump sum for other investments or an unforeseen financial emergency. You’re never stuck with the annuity. With the demand annuities enjoy in the market, they are as good as cash.

An annuity simply makes a secure nest egg. Financial security is the key to your contentment and happiness long into retirement. Annuities guarantee you’ll never outlive your savings. Yet if you find it something you no longer need, you can always sell it and take the cash in a lump sum for other investments or if you face a financial emergency. Investing in annuities is a good way to hedge your bets long into retirement, a guarantee you won’t outlive your income.