An annuity is a promise from an insurance company to provide you with monthly income payments for life. Whether you buy a deferred annuity for the future or an immediate annuity to guarantee lifetime payments right away, you do have the option of cashing it in on the secondary market. Some annuity companies will surrender the money back to you after they subtract fees, but there are options on the secondary market to sell your annuity for cash, quickly.
Speak with your financial adviser to assess your retirement needs. In many cases, you will need less than the sum total of your retirement investments provide. This may be a good time to find out if it will be worth it to sell all or part of your annuity payments. Before selling any investment, consult with a financial professional to make sure you are making the correct choice.
Call your insurance company. They can give you the surrender schedule. This is the amount that you will have to pay them to cash your annuity. The penalties start rather high in the first part of the contract, but often get lower as time passes. Immediate annuities, where you pay the annuity in one lump sum, often do not have any liquidity options and you eventually must take payments or sell on the secondary market. It is best to check with the insurance company to see what options they offer for cashing it in.
Contact a reputable annuity purchase company. These companies will evaluate your annuity and asses a value so that you can receive a lump sum of cash and they receive the payments. This is a great way to cash in an annuity if your insurance company will not allow you to surrender it or you will be faced with steep surrender costs. Selling an annuity is perfectly legal as the annuity is considered your property and you may sell all or even a part of it at any time.
Sell only part of your annuity. You can sell a portion of your annuity payments for a lump sum. Reputable annuity purchasing companies will buy an annuity in whole or part. If you have excess income from the annuity and you would rather have a sum of cash to purchase a house or pay for your grandchild's education, you can sell any amount of your monthly payment and you will receive a lump sum of cash in exchange. This is a great way to liquidate just a part of your annuity.