Swiss Alliance Group: A Brief History of Annuities
Swiss Alliance Group: ABrief History of Annuities
Many people are familiar with annuities andtheir place in the modern investment portfolio.Simply put, an annuity is a one-time payment toan insurance company. In exchange, theinsurance company agrees to make paymentsof specific values on a specific schedule, oruntil a specific event occurs (such as the deathof the policy holder).
Although annuities have only been a popularinvestment opportunity for the last few decades,their roots reach back 2,000 years to ancientRome. The Romans called them “annua,”meaning annual stipend or annual payout.Financial speculators received payment fromtheir investors in return for a specified annualpayout.
Although the Roman Empire eventually fell, theidea of the annuity had spread to Europe.Beginning in the Middle Ages and ending duringthe colonial period, many Europeangovernments used annuities to fund their warsand finance colonization efforts. Again, the ideabehind these annuities was very similar totoday’s annuity: governments asked investorsto pay a specific amount into the annuity inexchange for specified payouts at a later date.
In fact, annuities were popular among Europe’shigh society, as well. Much like today’sannuities, which are used primarily forretirement planning, many European nobilitysaw the value in paying into an annuity inexchange for future repayments as a way toprotect against losing their family fortunes.
Despite its popularity in Europe, however,annuities did not catch on in the United Statesuntil after the stock market crash of 1929.During the following Great Depression, manyAmericans seeking safe, reliable investmentplatforms turned to annuities as a way tosafeguard their financial futures.
Annuities as Americans know them todayfirst appeared in 1952 with the creation of thevariable annuity. Since then, annuities havebecome much more complex than their Romanand European roots. Nevertheless, annuitiesremain a popular financial investment toolaround the world, especially in terms ofplanning for retirement.
Backed by decades of experience in theinvestment sector, the Swiss Alliance Groupspecializes in deferred annuities for vacationowners. For more information on their tax-deferred vacation owner annuity, visit theirwebsite at www.SwissAllianceGroup.com