What is an advantage of purchasing a flexible premium annuity?

The advantage of purchasing a flexible premium annuity is that it allows the policyholder the opportunity to make multiple contributions over time. This feature is particularly beneficial for individuals whose financial situation may vary, as it enables them to invest additional funds when they have extra resources, rather than being locked into a single upfront payment.

Flexible premium annuities offer versatility, accommodating different saving patterns and financial goals. Investors can adjust their contributions based on current financial conditions or anticipated future expenses, which provides a level of financial control and adaptability. This flexibility makes it easier for individuals to manage their investments according to their needs, whether they are looking to save for retirement or other financial objectives.

The other options present characteristics that do not accurately represent flexible premium annuities. For example, the first option refers to a single lump sum investment, which is typical of single premium annuities, not flexible ones. The option regarding no charges for early withdrawals is not universally true, as many annuities may have surrender charges or penalties for early withdrawal. Lastly, while some annuities can provide guaranteed returns irrespective of the market, this feature isn't inherent to all flexible premium annuities; it relies on the type of annuity and its specific guarantees rather than the flexibility in