Annuities

Guaranteed Lifetime Income

Annuities are fundamentally unique in the realm of financial products, as they stand alone in their capacity to offer a secure and assured lifetime income. This distinguishing feature effectively mitigates the apprehension of depleting one's savings in the course of their lifetime. Although there are indeed alternative disbursement options available, the provision of a lifetime income remains the prevailing choice for the majority of individuals seeking long-term financial security.

Customizable to Your Needs

Since annuities are insurance products, you have a lot of options, and most can be customized through optional add-ons called riders to provide added benefits. As part of a well-rounded retirement plan, annuities can provide some protection for you and your family. That could include a death benefit (provided you didn’t start your income), a survivorship clause, or being able to pass the annuity on to heirs. This makes them more flexible than many retirement savings vehicles.

Tax-deferred Growth

Tax-deferred growth for annuities is a big plus for retirement planning. It means your investment can grow without being taxed until you take the money out, so you could end up with more savings in the end. This helps people save more for retirement and handle taxes better. The taxes you’d normally owe on the gains each year remain in your account and grow, often leaving you with higher balances down the road.

You can purchase an annuitiy within a tax-advantaged retirement plan (i.e. IRA, TSA, SEP), but it’s important to note that tax-qualified retirement plans already provide tax deferral under the Internal Revenue Code, so the tax deferral of an annuity does not provide additional benefits.

Flexible Contributions

Both 401(k)s and IRAs have annual contribution limits, which can limit your ability to maximize savings, especially as retirement approaches. On the other hand, deferred annuities offer a unique advantage by not imposing such restrictions, allowing individuals the flexibility to contribute as much as they desire. This means that whether you choose to make one substantial lump sum payment or a series of payments over time, you have the freedom to do so within the guidelines set forth in your annuity contract. It's important to note that there is a minimum contribution required to initiate the annuity.

Charges and Penalties

Be careful when purchasing an annuity product. If you try to access your funds early, there could be a surrender charge and/or tax penalties. It's important to choose an insurance company that is strong and built for the long term because the guarantees associated with annuity products are based on the claims-paying ability of the issuing company. To find the best product for you, we'll help you shop options. We only work with trusted insurance carriers.

Speak to one of our advisors today to learn more.