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What can an annuity do for you?

A tax-deferred annuity is a long-term investment option that can give you stability and guaranteed income in retirement. An annuity is one of many products offered by an insurance company. So the same company you trust with your life insurance can also help you with retirement planning.

Let’s look at the facts:

More than half (56 percent) of pre-retirees and retirees do not expect to receive enough income from Social Security and employer pensions to cover their basic living expenses in retirement.

— Retirement Income Preferences, LIMRA, 2006.

Four in five (78 percent) nonqualified annuity owners intend to use their annuity for retirement income.

— “The Facts of Life and Annuities”

Social Security replaces approximately 41 percent of the average earner’s income at retirement and is forecast to fall to 30.5 percent.

— “The Facts of Life and Annuities”

How does an annuity work?

You pay a large amount to the insurance company, usually in a lump sum — this is called “Funding the annuity.” The insurance company then pays you back a small amount over a period of time, typically for the rest of your life. If you die, the payments stop, unless the “Distribution” agreement includes continuing to pay out over the life of a remaining spouse.

Tax-deferred savings.

Since annuities are issued by an insurance company, the premium and interest can grow tax-deferred under current tax laws. Unlike taxable investments, you don’t pay taxes on annuity interest until you start to withdraw income.  This allows your money to grow faster than in a taxable account, because you earn interest on money that would otherwise have been paid in taxes.


Annuities are:


Payments received aren’t subject to the volatility of the stock market, so annuities are considered very safe investments.


Once you’ve purchased an annuity, your payment of premiums will guarantee a future source of income.


Since you’ll be receiving a fixed monthly payment, creating a retirement plan or budget is easy.

Many annuity options are available from our carrier partners.

Let our community-based agent representatives help you explore retirement planning solutions. Find a Futurity First branch office near you today.

To help determine your retirement planning needs, visit our Retirement Planning calculator.

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