Plan for a retirement you won’t outlive
An annuity is a contract with an insurance company that lets your savings grow tax-deferred and can later turn them into a steady income. With a fixed annuity, your money grows at a guaranteed interest rate, away from the ups and downs of the stock market.
Will you have enough saved?
Do you feel confident that you will have enough money saved for a comfortable retirement? It may seem far away, but there’s never a better time than the present to start planning. An annuity lets you accumulate money for retirement with tax-deferred growth during your working years. Together, we’ll make sure you don’t outlive your retirement savings.
How an annuity works
1. You fund it
Make a single payment, for example from savings or an old retirement account, or add money over time.
2. It grows
A fixed annuity earns a guaranteed interest rate. You don’t pay income tax on the growth until you take money out.
3. You use it
Later, take withdrawals or turn the balance into a stream of payments, including income for life.
4. Your family is covered
Many annuities pay any remaining value to your beneficiaries if you pass away.
Is an annuity a good fit for you?
An annuity may make sense if you:
- Want growth you can count on without stock market risk
- Are planning for retirement and want income that lasts as long as you do
- Have savings you won’t need to touch for several years
- Want to delay taxes on your earnings until you withdraw them
Annuities are long-term products. Taking money out early can mean surrender charges from the insurer, and the IRS may add a 10% penalty on earnings withdrawn before age 59½. Monica will walk you through these terms before you decide.
Good to know: Annuity guarantees are backed by the financial strength and claims-paying ability of the issuing insurance company. Withdrawals may be subject to surrender charges and income tax.
Annuity questions
What is an annuity?
An annuity is a contract with an insurance company. You pay in a lump sum or over time, your money grows tax-deferred, and later you can take withdrawals or receive regular income payments, even for the rest of your life.
Is my money safe in a fixed annuity?
A fixed annuity earns a guaranteed interest rate and isn’t invested in the stock market, so its value doesn’t drop when the market does. The guarantees depend on the financial strength of the insurance company, which is why we work with established carriers.
Can I take money out of an annuity early?
Usually, yes, but many annuities charge a surrender fee if you withdraw more than a set amount during the first several years, and the IRS may charge a 10% penalty on earnings taken out before age 59½.
How are annuities taxed?
Earnings grow tax-deferred. When you take money out, the earnings portion is taxed as ordinary income. Our office also offers tax preparation if you’d like help with the tax side.
Start building peace of mind
Talk with Monica about how an annuity could fit your retirement plan.