You can purchase an annuity to help grow and protect your retirement savings or provide an income you cannot outlive. There are at least 3 types of annuities- Fixed, Indexed and Variable and some may be immediate or deferred. Different tax categories apply.
An insurance contract with a fixed interest rate for the duration of the contract period.
An insurance contract with the potential to earn interest, based in part, on an underlying index. Principal and interest earned are locked in and not exposed to Market volatility.**
A contract that allows you to choose from a selection of investments and then pays an income in retirement. The value of a Variable annuity is determined by the performance of your investments. Variable annuities are typically associated with costs; including mortality and expense fees, mutual fund sub-account management fees, contract maintenance fees, and other miscellaneous costs
Annuities can be a nice addition to your portfolio depending on your risk tolerance, time horizon,
financial goals, liquidity needs and objectives.
*Annuity guarantees are based on the claims paying ability of the insurer
**Assuming no withdrawals during the withdrawal charge period. Rider charges continue to be deducted regardless of whether interest is credited
Annuities have withdrawal charges that are assessed during the early years of the contract if the contract owner surrenders the annuity. In addition, withdrawals prior to age 59 1/2 may be subject to a 10% Federal Tax Penalty. All withdrawals made from annuities with pre-tax contributions are taxed as ordinary income. All withdrawals from an annuity purchased with non -qualified monies are taxable as ordinary income only to the extent there is a gain in the policy.
VARIABLE ANNUITIES ARE SOLD BY PROSPECTUS ONLY, WHICH CONTAINS MORE INFORMATION. PLEASE READ IT AND CONSIDER CAREFULLY THE PRODUCT’S OBJECTIVES,RISKS,EXPENSES AND CHARGES BEFORE YOU INVEST OR SEND MONEY. THE PROSPECTUS CONTAINS THIS AND MORE INFORMATION ABOUT THE INVESTMENT COMPANIES. SECURITIES AND ADVICE REGARDING SECURITIES CAN BE OFFERED SOLELY BY REPRESENTATIVES REGISTERED TO OFFER SUCH PRODUCTS OR SERVICES THROUGH A BROKER/DEALER OR REGISTERED INVESTMENT ADVISER.
Bottom line: Annuities are a popular choice if you are looking for guarantees, locked in gains and lifetime income. For more details contact PFIS