|
|
The Possibilities of Annuities
|
|
|
You decide on the annuity features that put you on the right
track.
|
Annuities
are flexible, tax-deferred
investment plans that you can use to help you achieve your long-term financial goals
and provide a source of retirement income.
You can choose among different ways to buy an annuity, and you can set up a schedule
for receiving income that suits your needs. With
variable annuities, you can decide the level of investment
risk you want
to take, and select among a number of
separate account funds that match your income objectives.
When you've identified what you want an annuity to do for you, you can select a
contract that's designed to do it.
|
|
|
PUTTING IT TOGETHER Buying the
right annuity may seem intimidating because you have so many choices. But you can
simplify the process by focusing on four decisions:
|
- How the plan is offered
You may be able to choose an annuity as part of an employer-sponsored retirement
plan such as a 401(k)
or 403(b).
You can always buy an annuity yourself, as part of your own retirement planning.
- How you want to invest
You can buy an annuity with a single lump-sum payment or make multiple contributions
on either a regular or discretionary schedule.
- When you want to receive income
Immediate annuities let you start receiving income right away while
deferred annuities let you build your account tax deferred
until you need retirement income.
- The type of income you want
Fixed annuities
provide income at a specific rate. Variable annuity income changes to reflect the
investment performance of the
portfolios you choose.
|
|
|
|
COMPARING ANNUITIES
Earnings in all types of annuities compound tax deferred until you
begin to take money out. That means you can build a larger retirement savings account
than you would be able to if some of your earnings went to pay income tax every
year. Remember though, that while earnings in a fixed annuity are guaranteed, earnings
in a variable annuity are not.
When you are ready to draw from your retirement savings, all annuities offer you
a number of options for receiving income. You are guaranteed lifetime income if
you choose to annuitize,
which means converting your retirement savings into a stream of regular usually
monthly payments. Or you may choose to take
systematic withdrawals, which offer more flexibility but don't guarantee
lifetime income.
|
THE PLACE TO START
Here are some guidelines to help you begin to sort out what you
want your annuity to do for you:
- Analyze whether money you may have in investments, certificates
of deposit (CDs), or
money market accounts could be working harder for your
future
- Anticipate when you may want your retirement savings to
begin providing income
- Decide how much you should be committing regularly to long-term
retirement savings
- Compare the advantages of retirement plans that have historically
outpaced inflation
with the security of a guaranteed
rate of return
|
|
|
|
|
|
|
|
|
|
|
|
Glossary
|
|
Interactive Demos
|
|
Our Products
|
|
|
|
|
Try our interactive demo
to find out how contributing to a 401(k) can benefit you.
|
|
|
|
|
|