Overview: An annuity is a long-term retirement savings vehicle issued by a life insurance company designed to help accumulate funds and provide a steady stream of retirement income. Annuities typically fall into three basic types; each suited for a particular individual or life situation.

• Fixed: Conservative investors tend to prefer Fixed Annuities, which offer a safe and steady way to grow assets at a fixed rate of interest with a tax deferral, and a lifetime income option for a secure retirement.

• Index Annuities: There are a wide variety of Index Annuity designs. The most familiar design is the Annual Reset/Ratchet method. The main components are illustrated below:
  • Annual Reset Method
    • Gains are calculated and interest credited each year.
    • Interest is "locked in." This means once interested has been earned; it cannot be subtracted in the future due to a market downturn.
    • Because interest is "locked in" each year, the contractholder benefits from compounding.
    • This design is usually coupled with a participation rate or margin that is reset each year.
    • Ability to profit in years which the Index is recovering from prior down years.

• Immediate-Income: An Immediate-Income Annuity has little or no accumulation phase. It can be purchased with one payment and the purchaser may begin receiving income payments right away. Immediate-Income Annuities are often used by investors who wish to lock in a guaranteed income stream.

Annuities offer outstanding benefits for the right individual; to learn more about annuity products, and to see which one may be right for you, please contact us at 1-888-782-3433.