Coliday HealthCare Services

What Are Annuities?

Annuities can be a paramount way of saving for retirement. They are designed to assist in reaching long term financial goals such as the ability to create an income stream, put aside money for the future or to provide guaranteed lifetime income. Annuities also offer deferred tax status so you do not pay taxes until there is a withdrawal which helps your savings grow faster. Different annuities have advantages and disadvantages that should be carefully considered in choosing the right option.

Fixed Deferred Annuities
Fixed deferred annuities offer tax-deferral advantages with a set interest rate and can provide steady growth in value over time for long term retirement goals as they are not exposed to stock market fluctuations. Taxes are deferred until withdrawals are taken.

Features and Benefits:

  • Guaranteed Fixed Interest Rates
  • Protection from Market Volatility
  • Income Options
  • Tax Deferral

Guaranteed Fixed Interest Rates1
Fixed deferred annuities lock in a specified interest rate during the contract accumulation period (the period before annuity payments begin) allowing the money within your contract to grow slowly and steadily over time.

Protection from Volatility
You’ll be protected against the effects of market fluctuations when you choose a fixed deferred annuity. Provided you don’t make withdrawals, your principal is protected and will grow in value.

Income Options
Fixed Deferred Annuities offer income options that can provide guaranteed short term and/or long term income for life depending on individual needs.2

Deferral
Fixed Deferred Annuities offer a fixed rate of interest which allows the money value in the annuity to increase as the principal earns interest and as the interest on that principal compounds. Fixed annuities are free from current income taxes which allows your money to grow. Taxes are paid on the money in the event of a withdrawal.

Income Annuities
A type of annuity that provides guaranteed income for life with limited or no liquidity or for a period of time of your choice — either immediately or at a future date. As an additional source of income outside of Social Security or a pension, Income Annuities are designed to help convert a portion of your retirement savings into a predictable stream of guaranteed income for a specific amount of time or that you can't outlive.

Features and Benefits:

  • Guaranteed Income
  • Tax Efficiency
  • Income Options

Guaranteed Income
An Income Annuity gives you the confidence of knowing you will have the money you need for everyday expenses when the paycheck ends.

Tax Efficiency1
If you have already paid taxes on money used to purchase an income annuity, part will be taxable earnings and part of each annuity payment will be considered a return of the amount you paid for the annuity (your purchase payment).

Income Options
Income Annuity options offer the flexibility of the policy holder to decide when to and how often the income will be received (within contract limits). With the fluctuations in the financial markets, you can have peace of mind knowing Income Annuities can provide guaranteed income.3

1 Guarantees are based on the claims-paying ability of the issuing company.2 Taxable withdrawals are subject to ordinary income tax and, if made prior to age 59½, may be subject to a 10% federal income tax.The information provided is not written or intended as specific tax or legal advice. Our representatives are not authorized to give tax or legal advice. Individuals are encouraged to seek advice from their own tax or legal counsel. Taxable withdrawals are subject to ordinary income tax and, if made prior to age 59½, may be subject to a 10% federal income tax


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