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Single Premium Fixed Annuity
An Important Part of Your Total Retirement Income Plan
You may want a single premium immediate fixed annuity. The contract can help supplement your retirement income with guaranteed payments for life or for a specific period of time. Guarantees are based on the claims-paying ability of the issuing company.
Key Product Features:
• Guaranteed lifetime income – life annuity payments offer income that can’t be outlived.
• Tax benefits - a portion of each payment (until original investment recovered) will be excluded from income taxation on annuity contracts issued with after tax dollars.
• Inflation protection – you can elect an option to automatically increase income payments on an annual basis by 1%, 2%, 3% or 4%. Election of this feature will reduce the initial payment amount. This feature is not available with cash refund and installment refund annuity options.
• Access to cash withdrawals – during your retirement or for your beneficiary’s needs, if you choose a payout method that includes a period certain. Future payments may be reduced due to withdrawals.
• A wide range of annuity payment methods allow you to customize your income to meet your needs and goals.
• Four choices for retirement income payment frequency – monthly, quarterly, semi-annual or annual.
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With the help of your financial professional, you should review the type of retirement lifestyle you want, estimate your retirement expenses, review the assets available to help fund your retirement, and review the products and services available to convert your retirement savings into retirement income.
Income for Your Lifetime Starts Here
SELECT PAYMENT METHOD You can choose one of the following common annuity payment methods. The best choice for you will depend on many factors, including whether you name a joint annuitant, if you want to leave money to a beneficiary, or if you foresee a need to access cash through your contract. The option of withdrawing all, or part of, the value of remaining period certain payments is available with payout methods that include a period certain. There are charges associated with making withdrawals so be sure to review the information with your financial professional.
Help Take Control of Your Retirement Income call 866-392-INFO (4636)
Lifetime I ncome Payment Methods
• Single Life – Payments continue as long as the annuitant is alive.
• Single Life with Cash Refund – Annuity payments cease upon the death of the annuitant, subject to the Cash Refund guarantee. The Cash Refund guarantees that if the total of all annuity payments made is less than the Single Premium, the beneficiary(ies) will receive the difference in one lump sum.
• Single Life with Installment Refund – Annuity payments cease upon the death of the annuitant, subject to the Installment Refund guarantee. The Installment Refund guarantees the annuity payments will continue to be paid to the beneficiary, until the total payments made under the contract equal the Single Premium.
• Single Life with Period Certain – Payments continue as long as the annuitant is alive or for the guaranteed period, whichever is longer. If the annuitant dies before the period certain, remaining guaranteed payments are made to the payee(s) designated by the beneficiary.
• Joint and Survivor Life – Payments continue as long as either of two annuitants is alive. Upon the death of one annuitant, 100% of the payment continues for the lifetime of the surviving annuitant.
• Joint and Survivor Life with Installment Refund– Annuity payments cease upon the death of both annuitants, subject to the Installment Refund Guarantee. The Installment Refund guarantees that annuity payments will continue to paid to the beneficiary(ieses) until the total annuity payments made under this contract equal the Single Premium.
• Joint and Survivor Life with Period Certain –Payments continue as long as either of two annuitants is alive or for the guaranteed period, whichever is longer. If both die before the periodcertain, remaining guaranteed payments are made to the payee(s) designated by the beneficiary.
• Joint and Survivor Life with Reduction at First Death – Payments continue as long as either of two annuitants is alive. Upon the death of the first annuitant, 50%, 66.7% or 75% of payments continue for the lifetime of the other. (This annuity option is also available with the Installment Refund guarantee.)
• Joint and Survivor Life with Reduction at First Death and Period Certain – Payments continue as long as either of two annuitants is alive or for the guaranteed period, whichever is longer. When both annuitants die, 50%, 66.7% or 75% of the remaining guaranteed payments will be paid to the payee(s)designated by the beneficiary.
No n-Lifetime Income Methods
Another choice, Period Certain-Only, makes payments for a set period of time chosen by the owner, from 5 years up to 50 years.In this option only, the period may be lengthened or shortened after the first contract year, subject to certain restrictions. Upon the death of the annuitant, guaranteed payments continue to be paid to the payees designated by the beneficiary.We can provide quotes on the initial amount estimated for each payout method. You should compare these quotes before choosing a specific method.
SELECT PAYMENT FREQUENCY The frequency of payments will depend on how often you wish to receive income for purposes of planning your budget and lifestyle. You can choose to receive income payments monthly, quarterly, semi-annually, or annually.
EVALUATE ADDITIONAL FEATURES
Inflation Protection on Income Payments
You may choose to keep all payments level if you wish. On the other hand, you may select at no additional charge an optional feature. This feature automatically increases the amount of each payment by a specified percentage each year – 1%, 2%, 3% or 4%. The feature becomes effective when you begin to receive your annuity payments,may only be chosen when your contract is issued and may not be changed. The higher the annual percentage increase, the lower your initial payment will be. Inflation Protection may help offset a future decline in your payments’ purchasing power caused by inflation. If you are considering adding this to your contract, you should weigh the trade-off of a smaller initial income amount in order to get increasing income over time.
Cash Withdrawal Feature
Although many immediate annuities lock you into a payment stream and don’t allow cash withdrawals (aside from those annuity payments), you have a withdrawal feature in a single premium immediate annuity. Income taxes, tax penalties, a surrender charge and certain restrictions may apply to withdrawals. One full or partial withdrawal is allowed each contract year for period certain-only contracts. One partial withdrawal is allowed per year for life with period certain contracts. Withdrawals are not allowed in the first contract year. The minimum amount is $5,000; the maximum withdrawal is the present value of all remaining future period certain payments less any surrender charges. There may be limits on the amount available for a partial withdrawal, so that each remaining guaranteed payment is a minimum of $100. (Surrender charges gradually decline and then usually disappear on the contract’s 10th anniversary.) If all annuitants named in the contract die before the end of a period certain, the beneficiary has a cash withdrawal option, as well as the choice of receiving all future payments due. If a full cash withdrawal is taken immediately after the death of the last surviving annuitant, no surrender charge will apply. Consider carefully how important it is to you to have access to cash. Immediate annuities are designed first and foremost to provide lifetime income payments that are typically higher than other methods of generating lifetime income, all other things being equal. As such, while access to cash withdrawals is an available feature, other products and services may be more appropriate if liquidity is of critical importance in your evaluation of products and services.
Please contact us for any additional information you may need at 866-392-INFO (4636)
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