When an employee retires after several years of work, the employer offers monetary retirement benefits, such as cash balance plans, as a gesture of gratitude for the employees service.

Many people like to invest their retirement package in an insurance company on the condition that their money is paid back on a regular basis. They buy this arrangement, known as an annuity, from the insurance company. By going in for an annuity, the investor is assured of a regular income through retirement, or thereafter to him or to his heirs. Fixed annuities are the most popular type of annuities. These annuities offer a constant rate of return, unlike variable and equity-indexed annuities. Hence, it is relatively easy to sell fixed annuities.

But one problem is that even fixed annuity payments cannot meet the investors immediate or unexpected financial needs, like buying a house or paying for medical expenses. However, government rules allow the investor to sell his annuity payments and use the money for his financial needs. The annuity sales process is as follows: the investor, who wants to sell the annuity, calls any finance company that handles annuities and requests a quote from them. The company offers several options that can meet the persons financial needs. Once the person selects the option, the company completes the application process. The applicant is provided with a disclosure statement and a contract, which he will sign and get notarized. The finance company collects the contract along with relevant documents, processes the application and submits them for approval to the court. The companies are expected to follow all relevant state and federal laws in the process. The court reviews the application to confirm if it is in the best interests of the applicant.

Once the court approves the application, the finance company notifies the applicants insurance company of the transfer. Cash is transferred to the applicant in a few days time.