Annuities: Variable or Fixed?
Annuities are tax-deferred investing options for your future needs that offer a supplement to a retirement program. There are two forms available: Variable Annuities and Fixed Annuities
The value of the annuity and the amount of income ultimately received is directly related to the performance of the funds that you've selected. The fund selection process is critical and will vary for each individual depending on the amount of risk you are willing to incur versus the return you're seeking.
Accumulation PeriodThere are two phases in the life of a variable annuity, an accumulation phase and a payout phase. In the accumulation phase, the value of the annuity will increase or decrease depending on the performance of the selected funds. The accumulation phase continues until the contract matures.
Payout PeriodUpon maturity, the payout stage begins. In the payout phase, as the annuitant, you will begin receiving monthly payments that can be guaranteed for life. You will have a choice of payment options, and may receive fixed payments every month, variable payments every month, or a combination of both. Some companies offer an inflation protected lifetime payout increasing by the Consumer Pricing Index. Variable payments are based on the performance of the funds in which you've invested and as a result will vary from month to month. The payout stage continues until the annuitant dies or until the end of a fixed time period, depending on the payment option selected.
All in all, variable annuities can be a useful investment vehicle to help you achieve a more secure and worry-free retirement.
Variable Annuities are offered by prospectus only. Prospectuses contain more complete information on management fees, charges, and other expenses and should be read carefully before investing or sending money.
Variable Annuities are subject to various fees and charges, including surrender charges. Withdrawals taken before age 59 1/2 may be subject to a 10% federal tax penalty. All guarantees of a variable annuity are based on the claims paying ability of the insurance company.
If you've already taken maximum advantage of available tax-favored investments, including an employer-sponsored retirement plan and an IRA, you may want to consider a fixed deferred annuity.
Contact Us For More Information
For more information, contact Joe Jaspers, CFP®*, the Carolinas Telco Capital Advisors Representative serving Carolinas Telco Federal Credit Union for a no cost, no obligation consultation. We have the tools and experience to help you design and implement the plan that is right for you. Contact us at our Financial Services Center located at the Sharon Road West Branch:
Form Number: FR-1664668.1-1216-0119
Apple and the Apple logo are trademarks of Apple Inc., registered in the U.S. and other countries. App Store is a service mark of Apple Inc., registered in the U.S. and other countries. Google Play and the Google Play logo are trademarks of Google Inc.
By accessing this link, you will be leaving the Credit Union’s website and entering an email site hosted by another party.
Although the Credit Union has approved this as a reliable email address, please be advised that you will no longer be subject to, or under the protection of the privacy and security policies of the Credit Union’s website. The other party is solely responsible for the security of its email service. As such the security of any sensitive information transmitted is not guaranteed. We do not recommend sending any sensitive information through this channel.
Please visit our “contact us” webpage for more information on secure methods available for contacting the Credit Union.