Annuities Quote Forms
Looking for coverage? Click any of the following links to submit a quote for quick, accurate and affordable rates.
What is an annuity?
By example, pensions and payouts from lotteries or sweepstakes are forms of annuities. But there are many options for funding and then accessing those funds in the future.
An annuity is a long-term investment between you, the annuitant, and an insurance company, the annuity issuer. Under this contract, you pay after-tax funds to the annuity issuer, who then invests your principal to meet your financial objectives and pays you or your beneficiary back with earnings (subject to the claims-paying ability of the issuer).
If you have a fixed annuity, your interest rate is guaranteed. With a variable annuity, your earnings are linked with the fluctuating performance of your investments and may be worth more or less than your principal when redeemed. In addition, you have added control in how your money is invested, creating a higher potential for growth. However, this option comes with a higher risk in return.
Unlike other investment plans, there is no limit to how much you can invest in an annuity. Your funds will steadily grow with a tax-deferred status, and you pay your regular tax income rate on only your earnings upon withdrawal.
What annuity options are available?
An immediate annuity can begin paying you right away. You can choose whether you want your income guaranteed for a specific time period or if you want lifelong payments. The amount of your payments is calculated based on your principal and your life expectancy.
A deferred annuity is broken up into two phases:
- Accumulation: This is when you add money to your annuity, whether you pay in a lump sum or you make a series of payments. You can continue to let your account grow tax-deferred for an indefinite amount of time.
- Distribution: This is when you begin withdrawing money from your annuity whether you take out systematic withdrawals or you annuitize to supplement your finances with a regular stream of income for life.
What does 'annuitization' mean?
When an owner choses to annuitize their contract, the account value is frozen with no more growth. Using the distribution option(s) chosen along with a client's standard life expectancy the issuing company will calculate a payout, usually with period specific or lifetime payout guarantees..
What is 'guaranteed withdrawal benefits'?
Some annuities offer this option instead of annuitization. The benefit with this distribution method is that the account value is still participating in growing in value due to various crediting methods.
What distribution options exist?
Depending on the provisions of the annuity contract, access to the account value may be possible each year, typically limited to 10% of the value with no contract penalty.
What makes an annuity 'qualified'?
An annuity can be qualified or non-qualified. This depends on the money used to purchase the annuity. Was it pre-tax in an IRA or 401k/403b type of account, or after-tax money? Distributions from a qualified annuity will be taxable. Only the growth in the annuity will be taxed if it is non-qualified.
Why buy an annuity?
An annuity is a good investment option for individuals who are willing to take a smaller risk than the stock market in return for a guaranteed payout. Your earnings can then be used for supplemental income during retirement, guaranteed financial independence as you age, or a monetary legacy to leave behind for your loved ones. An annuity can help you continue living comfortably well into old age.
Buying an annuity could be for a relatively short (7 year) period to balance a retirement portfolio to achieve returns similar to the bond market.
Contact us to learn more about planning your future with an annuity. We are happy to answer your questions and help begin your investment process today.