Understanding the Benefits

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Understanding Annuity Benefits

An annuity is defined as an agreement with a company or organization, set up to allow you to receive money on a set schedule. This product, obviously, comes with a lot of flexibility. The risk associated with an annuity comes from, at the end of the day, what specific type you have. For example, there are fixed annuities, variable annuities, and fixed indexed annuities. In our experience, fixed indexed annuities (FIAs) are the ones that come with the best benefits.

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Fixed Indexed Annuity Benefits

An FIA has the benefit of keeping your money safe. This is because it doesn’t invest money in the stock market. However, it can grow based on the performance of an index. Even if the economy takes a hit, your retirement savings won’t.*

An FIA can’t, however, lose value even if its index or indexes perform negatively. The company sets the money aside in a reserve where it’s safe from harm* until you withdraw it.

There are two main stages to an annuity contract:

Accumulation and Distribution

During the accumulation stage, your money grows, tax-deferred, until you’re able to begin withdrawing from it. This is when the distribution phase starts. Unlike some retirement accounts, FIAs do not have Required Minimum Distributions. However, the rules of individual annuity contracts do vary. It’s important that you learn all the rules.

Learn More

Want to learn more about annuity benefits? We can help. Reach out to us the set up a one-on-one appointment, or simply reserve a spot at one of our no-cost, no-obligation educational seminar events.