Annuities

An annuity is a contract between you and an insurance company, under which you make a lump-sum payment or series of payments. In return, the insurer agrees to make periodic payments to you beginning immediately or at some future date. Annuities typically offer tax-deferred growth of earnings and may include a death benefit that will pay your beneficiary a guaranteed minimum amount, such as your total purchase payments.

There are four types of annuities: Fixed, Immediate, Equity-Indexed, & Variable

Fixed Annuity

The insurance company guarantees that you will earn a minimum rate of interest during the time that your account is growing. The insurance company also guarantees that the periodic payments will be a guaranteed amount per dollar in your account. The focus is on safety of principal and stable investment returns.

Immediate Annuity

Designed to pay owners a determined amount of money on a monthly, quarterly, annual or semi-annual basis. The amount you receive will depend on initial premium deposit, the length of time of your annuity and the guarantees set forth by the particular insurer.

Equity-Indexed

During the accumulation period, you make either a lump sum payment or a series of payments. The insurance company credits you with a return that is based on changes in an equity index, such as the S&P 500 Composite Stock Price Index. The insurance company typically guarantees a minimum return. Guaranteed minimum return rates vary.

Variable Annuity

Flexibility, allowing investors to invest simultaneously across a wide array of securities: bonds, mutual funds, stocks, futures, etc. They are designed for more aggressive investors who desire investment flexibility. The insurance company does not share in profits of investments or protect losses. They carry the same risks as individual stocks, bonds or mutual funds.