Immediate Annuity -
Converts assets into immediate income immediately (typically within
30 days and seldom longer than 12 months from the date of purchase).
Immediate annuities can either be fixed or variable annuities.
Deferred
Annuity - Provides income at some time in the future - typically
during retirement. Premium payments accumulate tax-deferred. There
are 3 types of deferred annuities: |
 |
1 |
Fixed, deferred annuity - Your money accumulates at a fixed rate guaranteed by the insurance
company for a specified period of time. |
| 2 |
Variable, deferred
annuity - Your money accumulates at a variable rate, based upon
the performance of the underlying investments. The investments return
and the value of an investment will fluctuate so that an investor's
shares, when redeemed, may be worth more or less than their original
cost. |
| 3 |
Equity
Indexed Annuity - These annuities have a guaranteed fixed rate
of return. The policyholder earns added interest based on a stock
index, i.e. S&P 500, Dow, Bonds, and does not lose principal if
the index decreases!" |
When you no longer wish to keep accumulating funds in
your annuity, you may take the money as a lump sum or "annuitize,"
whereby you convert the annuity to income payments. If you annuitize,
you have a choice of several payout options. Liquidations of earnings
are subject to ordinary income tax and, if taken prior to age 59-1/2,
a 10% federal income tax penalty may also apply
Although there are hundreds of different annuity products
available today, we quote a wide number of annuities and help you sort
through your options to select the best fit for your planning needs. |
