 | Earnings are not currently taxed, which may
allow a larger nest egg to accumulate. (Earnings are taxed upon
withdrawal or surrender.) |
| Safety of principal is guaranteed by the
issuing insurance company. (Subject to the claims-paying ability
of the insurance company.) |
| The fixed annuity's account value does not
fluctuate with the stock or bond market. |
| Tax deferral on earnings may help protect
Social Security benefits. (Earnings accumulating in an annuity are
not counted as income when determining tax on Social Security
benefits, unless earnings are withdrawn.) |
| Taxes may be reduced if money is moved from an
investment generating currently taxable income to fund the
tax-deferred annuity, where future earnings are tax deferred. |
| A fixed annuity may be available with no
upfront fees or charges, which means that 100 percent of the
premium can go to work immediately. (Surrender charges may apply
in the early years after a payment.) |
| Various payout options are available, including
income that can't be outlived. (A 10% penalty may apply to
withdrawals prior to age 59½. |
| A fixed annuity may offer access to a certain
percentage of account value each year free from surrender
charges. |
| Renewal rates cannot drop below a preset
minimum, offering some protection against generally lower
interest rates in future years. |
| Proceeds can be paid to a named beneficiary
without the expense and delay of probate. |
| Surrender charges may be waived to help in the
case of an emergency, terminal illness, or unemployment.
(Certain restrictions apply; may no be available on all products
in all states.) |
If you're interested in a conservative retirement savings
vehicle, check out fixed annuities. You'll find they offer benefits
that go far beyond competitive interest rates.
Roth IRA: An Amazing Tax Shelter
Taxpayers are rejoicing about the Roth IRA, a wealth accumulation
vehicle that may dramatically increase earning potential.
You pay taxes up front when signing on for the Roth IRA, and
don't have to pay a penny more in taxes ever again. That means your
money can grow tax deferred and withdrawals can be tax free as well
(if you meet certain holding period and age restrictions).
The Roth IRA is the best news the retirement planning community
has seen in a long time. Its features and benefits differ from the
traditional IRA and can provide an added edge.
