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medical bills and taxes - can you deduct them?

Do you have a lot of medical bills that you pay on each month? Could those medical bills be deducted from your tax bill this year? I was helping my mother take care of all of her finances after my dad passed away. I didn't realize how many bills she had coming in each month for medical treatments that my dad had undergone months, even a year earlier. I started doing some research about medical bills and tax deductions. If you have medical bills, take a minute to read through this blog to gain some knowledge that can help you decide what you can do when tax time comes around.


medical bills and taxes - can you deduct them?

Four Things You Need To Know About Annuities

by Don Walters

If you're looking for additional retirement investing opportunities and you have a large chunk of cash that you can invest all at once, an annuity might be the product you're looking for. Give that money to an insurance company and get checks every month in return; sounds nice, doesn't it? Depending on the type of annuity you choose, you could be adding a stable source of income to your life -- or you could be tying up money and getting very little in return. Here are four things you need to know about buying an annuity for your retirement.  

Simpler Is Better

Some annuities are straightforward and stable, like souped-up certificates of deposit. For example, with a fixed-rate annuity, you deposit the money with the insurance company, and each month, the company pays you part of the principal along with some interest. No matter what happens in the world, you get that interest rate every month. You can have the money distributed now, or place it on hold until you're closer to retirement.

Other forms aren't so simple. Some annuities are linked to equities and have rates and returns that vary wildly. These might be good if you have cash to burn and are purposefully looking for a financial thrill ride. But if you're trying to supplement your income, a steadier, albeit potentially lower, fixed rate would be better.

Age Matters

Distributions from the annuity typically lower the annuity's principal amount. In other words, the annuity can run out, depending on how you have it set up. If you're relatively young, taking payments now could mean that later in your retirement, you would see the annuity income stream end. Waiting until later to take distributions or even buy the annuity in the first place could be a better choice.

You'll Still Owe Taxes

Annuities aren't tax-free. They can be tax-deferred, meaning you wouldn't pay taxes on the gains until you actually got them, but you'd still have to take taxes into account when calculating your income from the annuity. You wouldn't be able to use everything you got, and that could really affect your bottom line.

Death Benefits Aren't Guaranteed

If the annuity outlives you, it isn't guaranteed to go to your beneficiaries. You can add a death rider that states the remainder of the annuity will go to your heirs, but you have to specifically discuss that with the insurance company. Often a remaining annuity will go to the insurance company after you die. This can also vary by the state the annuity is in; for example, an annuity that you're taking distributions from might go to the insurance company, but an annuity that's on hold and waiting for you to authorize distributions could go to your heirs if you die before you start taking the funds.

If you're interested in annuities, you should talk to a financial advisor to find the best combination of riders and rates for you. Annuities can be a very handy place to park some money, but you want to be sure that you're getting the best -- and safest -- possible return on the money.