Fixed Annuities

An annuity can help you accumulate tax-deferred earnings as part of your overall retirement plan. Annuities offer the opportunity for lifetime payments and tax-deferred earnings and provide a guaranteed death benefit for your beneficiaries. All guarantees are backed by the continued claims-paying ability of the issuing insurance company. You may want to consider investing in an annuity as part of your long-term financial strategy if:

• You’re in a higher tax bracket and want to defer additional income.
• You’ve reached your deductible limit on all your retirement accounts and wish to save more for retirement.

An annuity is different from most other retirement savings vehicles. It’s actually a contract between you and an insurance company. In return for making one or more premium payments, the insurance company agrees to provide you an income stream, usually during retirement. Annuity contracts can last from as little as three years up to 15 years. You can elect to receive payment all at once or as a series of payments, even for the rest of your life.

Fixed Annuities

A fixed annuity promises that you’ll earn a stated interest rate on your money, resulting in the same payout year after year.  The insurance company assumes the risk and guarantees that you’ll make the stated interest rate. Fixed annuities are not tied to the stock market in any way.

Indexed Annuities

With an indexed annuity, you can make a one-time payment or a series of payments. The company will credit you the return that is calculated by the changes on a certain index, such as the S&P 500. It will also guarantee you a minimum return, though these minimums can vary from one company to the next.