What is an occupied life annuity ? advantages and disadvantages
Some advantages of an active annuity are that it guarantees a certain level of income for a set period of time, can provide financial stability during retirement, and can provide peace of mind. An occupied annuity also has disadvantages, such as limits that can be placed on lifestyle choices and reduced lifetime income potential. However, buying a free life, which may be of interest to a seller, is not as common as an active life. The latter is less expensive than a traditional purchase, but has the disadvantage of not being able to enjoy the property until the seller dies. Think of an annuity purchase as a real estate investment rather than a short-term housing solution. Negotiating large bond payments and lower annuities is also a way to secure an investor’s purchase.
For the seller, the main benefit is the ability to receive a life annuity while enjoying a favorable tax treatment. He can continue to enjoy his home without being the full owner. He can also use the annuity to finance his investment in a nursing home.