3 minute read
Annuities are Protected Income
Whether you’re planning for retirement or retired, we all have our bucket list of things to pursue and accomplish in our next chapter of life. Whatever is on your list, most of it will involve spending some money.
That’s why millions of Americans use annuities to protect and grow their retirement savings to help cover their basic monthly expenses – things like a mortgage or rent, utilities, groceries, or transportation – so they have the peace of mind and freedom to live the retirement they want.
Annuities have protected the retirement of millions of Americans over the centuries. Benjamin Franklin saw the power of annuities by giving them to the cities of Philadelphia and Boston in his will. In 2007, then Federal Reserve Chairman Ben Bernanke disclosed that his largest financial assets are annuities.
Check out the timeline below to learn more about how annuities have been a reliable and trusted option for decades.
In simple terms, an annuity is a contract between an individual (or married couple) and a life insurance company. Depending on the type of annuity, you purchase an annuity with a portion of your retirement savings in either a single payment or with multiple payments over time.
There are many annuity types available today, with different features, benefits, and costs, but they basically fall into three main categories:
An annuity that protects your principal from market downturns and offers a fixed rate of interest for growth and guaranteed monthly payments.
An annuity that protects your principal from market downturns, offers a minimum crediting rate with potential for additional interest based on market indexes, and guaranteed monthly payments.
An annuity that offers the potential to grow your money through various market investments, but with the potential for market loss, and the option of receiving guaranteed monthly income payments.
There are also two main types of payout options:
You delay receiving monthly income payments to a future date, giving your money in the account time to grow.
Monthly income payments begin shortly after purchasing the annuity.
But don’t just take it from us – hear from some American retirement savers on the benefits of annuities in their planning journey:
Dale “Opie” Skjerseth Testimonial
Testimonial of Dale Skjerseth (also known as “Opie”), Production Director for the Rolling Stones. Hear how Dale uses his annuity to eliminate risk in his own life, amid the risky environment of rock n’ roll.
Following his Yellow Brick Road By Protecting His Retirement
Mike Gomez, Elton John’s head production rigger, tells us how an annuity gives him the certainty and peace of mind to pursue what’s next in life.
Dr. Benjamin LaBrot Testimonial
Testimonial of Dr. Benjamin LaBrot, Founder of the Floating Doctors Medical Team. Hear how Dr. LaBrot sees his annuity as a “life preserver.”
Dr. Rosaly Lopes Testimonial
Testimonial of Dr. Rosaly Lopes, Volcanologist. Hear how Dr. Lopes equates managing risk of volcanos to managing risk in her financial planning.
Interested in learning more about how an annuity might be right for you? Check out our resources below and find a financial professional who can help get you started.
ELTON JOHN’S ‘FAREWELL YELLOW BRICK ROAD TOUR’
Check Off the Basics Guide
PROTECTED INCOME FOR THE BEST OUTCOME: THIS IS WHAT AN ANNUITY CAN DO
*“Annuities are long-term financial products designed for retirement purposes. Early withdrawals may be subject to withdrawal charges. Partial withdrawals may reduce benefits available under the contract. Withdrawals of taxable amounts are subject to ordinary income tax and, if taken prior to age 59½, an additional 10% federal tax may apply. Optional income protection features are subject to additional fees, requirements and other limitations. Keep in mind, for retirement plans and accounts (such as IRAs and 401(k)s), an annuity provides no additional tax-deferred benefit beyond that provided by the retirement plan or account itself. Contract and optional benefit guarantees are backed by the financial strength of the issuing insurer.”