ANNUITY BASICS

ANNUITY BASICS

WHAT IS AN ANNUITY?
AN ANNUITY IS A CONTRACT WITH AN INSURANCE COMPANY THAT PROVIDES CERTAIN BENEFITS IN EXCHANGE FOR A DEPOSIT OF MONEY, KNOWN AS A PREMIUM. ANNUITIES ARE NOT LIFE INSURANCE POLICIES.

FIXED INDEXED ANNUITY – INTEREST is linked to the performance of a stock market index such as the S&P, Nasdaq or Dow Jones. The annuity GUARANTEES PRINCIPLE and minimum interest.

TRADITIONAL or MULTI-YEAR GUARANTEED ANNUITY earnings are based on a fixed rate also have a GUARANTEE of principal and interest. Each has tax deferred growth so you earn interest on interest and do not pay taxes until withdrawn.

These tax deferred annuity contracts accumulate interest over a period of years and the account value is available for partial or full withdrawal with less restrictions than a CD from the bank. The owner of the contract can ANNUITIZE the contract turning it into an irrevocable stream of payments for a lifetime or a period certain. An irrevocable beneficiary designation makes sure your account value goes to your loved ones when you pass away.

VARIABLE ANNUITY – Earnings are generally based on investment options, such as stock, bond, or equity markets. These contracts CAN LOSE VALUE when the investment option suffers market losses. These contracts also charge fees that can be substantial and are not recommended for the retiree due to market risk.

Annuity Video #1:

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Fidelity & Guaranty Life
Americo
Deleware Life
Equitrust
American National
Genworth
Lincoln Financial Group