A fixed annuity combines two of the most important features of a sound retirement plan -- security and predictability -- with the wealth-building power of tax-deferred compounding.
Some of the important features of a fixed annuity are:
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Tax-deferred compounding of your interest earnings
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Virtually no limit to the amount you can apply toward your purchase payment
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Access to your funds should you need them
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Competitive yields
What is a variable annuity?
A variable annuity allows you to maximize the growth opportunities of stocks, bonds and other securities by deferring any taxation of your potential gains. With a variable annuity, the insurance company offers you a range of portfolios, called sub accounts, which may vary from conservative to aggressive in their investment management style. Often there is also a fixed account option. The fixed account is part of the insurance company's general account. The sub accounts allow you to allocate your investment dollars among an array of portfolios that invest in U.S. and international stocks, bonds and other securities to help you create a portfolio that closely matches your tolerance for risk vs. reward.
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