Annuities

People are living longer and that means more time and savings will be spent in retirement. If you need a tax-deferred investment to provide a guaranteed stream of income for life or a specified number of years in the future, an annuity may be worth considering.

What is an annuity?

An annuity is a contract between an insurance company and an annuity owner. In exchange for a purchase payment, or series of purchase payments, the insurance company guarantees1 to pay a stream of income that begins immediately or at some time in the future, generally after the annuitant reaches age 59½. Many annuities offer tax-deferral advantages and beneficiary protection options. In addition, annuities can provide income for life, for a specific period of time, or a combination of both.

Who needs an annuity?

As life expectancy continues to increase for most Americans, it’s clear that many people will spend more of their time – and their savings – in retirement. An annuity can play an important role in your retirement income strategy by providing a guaranteed, predictable income stream you can’t outlive – and may offer tax-deferral advantages as well. However, annuities are not right for everyone. It’s important to discuss any annuity options you are considering, including associated fees or expenses, with your financial professional.

Fixed Annuities

The money in a fixed annuity is credited with a fixed rate of interest for a period of time specified in the contract and the tax-deferral advantage allows those assets to benefit from compounding over time.

Variable Annuities

Variable annuities combine tax-deferral of any earnings with the ability to allocate purchase payments among a range of investment options, designed to meet individual financial goals and risk tolerance.

Income Annuities

Income annuities can provide income either immediately or at some time in the future.