New York State Life Insurance Exam Questions Practice Question
A single premium immediate annuity is MOST often used for
Correct Answer: A
Rationale: A single premium immediate annuity is primarily designed to provide a steady stream of income, making it ideal for retirement income. This financial product allows individuals to convert a lump sum into regular payments, ensuring they have a reliable source of funds during retirement.
Option B, children's college expenses, typically requires a different savings strategy, such as 529 plans, which are specifically tailored for education costs.
Option C, mortgage payments, is generally managed through traditional loans or refinancing, not annuities.
Option D, vacation expenses, is usually funded through savings or budgeting rather than a structured income product like an annuity.
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