Annuities

A Steady Source of Income for Your Future

Annuities are financial products designed to provide a guaranteed stream of income, typically for retirement. They can be a powerful tool for individuals seeking financial stability in their later years, offering a predictable income stream that can help cover living expenses, healthcare costs, and other needs. While annuities come in various forms, their core appeal lies in the security they provide—especially when you want to ensure that you don’t outlive your savings.

At its core, an annuity is a contract with an insurance company where you make a lump-sum payment or a series of payments in exchange for periodic disbursements in the future. These disbursements can begin immediately or be deferred until a later date, depending on the type of annuity you choose. The amount you receive is typically determined by factors such as the length of the payout period, the amount of your initial investment, and sometimes, the performance of underlying investments.

Types of Annuities:

Fixed Annuities: Fixed annuities offer a guaranteed income for a set period or for life, depending on the contract. The payments are predictable and steady, providing peace of mind, as you know exactly how much you will receive and for how long. Fixed annuities can be an excellent choice for individuals looking for stability and protection from market volatility.

Variable Annuities: Variable annuities allow you to invest in a range of options, such as mutual funds, and the income you receive depends on the performance of those investments. While variable annuities offer the potential for higher returns, they also come with more risk. They can be suitable for individuals who are comfortable with market fluctuations and want to potentially increase their income over time.

Index Annuities: One of the newer and more popular types of annuities is the index annuity, which provides the opportunity for growth linked to a market index—such as the S&P 500—without the associated risk of directly investing in the market. This type of annuity combines elements of both fixed and variable annuities, offering a balance between growth potential and protection. While your returns are based on the index's performance, the principal value of your annuity is protected, meaning that if the market declines, you won't lose money. In other words, the value of your annuity will never drop below the amount you originally invested, regardless of market conditions.

• Immediate Annuities: With an immediate annuity, you start receiving payments almost immediately after making a lump-sum payment. This type of annuity is often used by individuals who are already in retirement and want to ensure a steady income right away.

• Deferred Annuities: Deferred annuities allow your investment to grow over time, and you can choose when to start receiving payments—often at retirement age. This type of annuity can be ideal for those looking to accumulate savings before beginning withdrawals at a later date.

Annuities can be an excellent way to secure a steady income stream in retirement, and index annuities offer a unique solution for individuals who want growth potential with no market risk. By linking your returns to a market index but protecting your principal from losses, index annuities provide a compelling option for those seeking a balance of safety and growth. We will help you navigate the details and determine if an index annuity aligns with your retirement goals, providing you with both security and the opportunity to take advantage of market gains.