The Basics of Annuities
The Basics of Annuities
The value of annuities
Annuities can help address one of your fundamental concerns: Outliving your savings. They offer you guaranteed lifetime income payments*, which may give you freedom to fulfill your retirement dreams and help with your financial peace of mind. They also give you flexibility to use your cash however you choose.
An annuity may be right for you if…
You’re nearing retirement or you’re already retired
You thought saving for retirement was the hard part. Now you need a steady retirement income.
You’d like to minimize the taxes** you pay on your annuity earnings
You don’t need the money right now. So, you’re looking for a way to accumulate funds while deferring tax payments.
You’re looking for an alternative to a certificate of deposit
You want your money to work hard for you. So, you’re looking for something with the potential for higher returns.
Two basic types of annuities
Income Annuities
Income annuities can provide you a guaranteed*, reliable income stream that you can’t outlive. If you’re nearing retirement age or are already retired, income annuities can help supplement your income through a series of payments throughout your lifetime or for a specific period of time.
Deferred Annuities
Deferred annuities can help you accumulate assets for retirement by offering you a fixed rate of return and tax-deferred growth. And with deferred annuities, your investment will never decline in value.
What annuities can offer
Guaranteed, reliable income*
One of the most difficult problems in retirement is determining how much income you’ll need. Annuities provide reliable income that you can use however you wish.
Tax-deferred growth
Taxes on annuity earnings are deferred until you begin taking money out***. That may help you minimize the amount of tax you pay.
Flexible income options
Everyone’s situation is different. Annuities offer income options and choice of frequency so you can select what’s right for you.
How annuity payments can be used
How you use your annuity payments is up to you. Many people use the money to:
Pay everyday living expenses
Supplement Social Security payments or other income sources
Fund a grandchild’s education
Contribute to charity
Purchase other insurance products