|
HOME > FIXED ANNUITIES 
A fixed annuity is a financial contract with an
insurance company whose tax-deferred growth is
designed to be a source of retirement
income. Annuities come in many different
types: Single Payment vs. Flexible
Payment; Immediate vs. Deferred; Bonus
Annuities; Multi-Year Rate
Guarantees; Lifetime Income vs. Fixed
Period; Lifetime Income with Fixed Period
Guarantee; Joint Annuities; and Equity
Indexed Annuities. Many of these types can
be mixed and matched. An annuity can even
be structured to help pay the premium on a
long-term care insurance policy.
|
A fixed annuity could be the best alternative to help fund your retirement, and provide a firm foundation
for a sound financial plan. |
An Income You Cannot Outlive
Annuities offer the opportunity to both
accumulate retirement savings and to ensure that
those savings can't be exhausted in retirement,
no matter how long that may be. Earnings grow
tax-deferred during the accumulation phase of an
annuity and, if a lifetime payout plan is
chosen, payments continue for life. An annuity
is a personal pension plan that can be used by
anyone to supplement other public and
employer-paid retirement income. Longevity risk
is the biggest and least recognized financial
challenge facing people today, and using
annuities, as part of your financial plan, can
be an important part of assuring adequate assets
in retirement.
|
Some
policies place an emphasis on long-term enhanced values and
feature an array of living benefits. |
Power of Tax-Deferred Growth
Earnings in an annuity, unlike most financial products, are not currently taxable as income. Earnings are tax-deferred until you actually withdraw your money. This means the money you would have used to pay taxes can remain in the annuity earning more interest.
Tax advantages can occur at payout, too. Although income from qualified plans (such as private pension, profit sharing, IRA or similar plans) is usually fully taxable when received, non-qualified annuities use an IRS exclusion ratio that determines the taxable and nontaxable portions of the income payments. Essentially, you only pay taxes on the portion of payout that represents income earned on the annuity. That's because contributions you made to the annuity have already been taxed when they were earned.
|
EIA's
provide the safety of a fixed annuity
with the opportunity to participate in
stock market gains. |
Equity Indexed Annuities
An equity-indexed annuity is an annuity that earns interest that is linked to a stock
market index. An equity-indexed annuity is different from other fixed annuities because of the way it credits interest to your annuity's value. Traditional fixed annuities credit interest calculated at a rate set in the contract. Equity-indexed annuities credit interest using a formula based on changes in the
stock market index to which the annuity is linked.
How much interest you get and when you get it depends on the features of your particular annuity. This feature can give you the opportunity to participate in the growth of the stock market without any stock market risk to your principle.
Needs Driven
It is very important to identify and
evaluate your needs prior to making any
financial investment. Request more
specific information for yourself or a family
member, or call Jim Hetherman at 818-953-4268, or email
Jim@Burbank.com.
|
