Annuities, Retirement Plans, & Rollovers
The best way to find the insurance or financial product you need is to meet with an independent agent, such as those affiliated with Liberty Assurance Group.
Send us an e-mail or call us toll free at (888) 524-4621. Please describe the nature of your inquiry and need. We'll refer you to an agent who can help.
We're open Monday through Friday from 8:00 a.m. to 6:00 p.m. (Central Time).
General Information
Under current tax treatment, annuities accumulate wealth on a tax-deferred basis.
Annuities may be tax qualified, tied to an IRA for example. Annuities may be used as a retirement plan, and generally funds in existing retirement plans, including 401's, may be transferred or "rolled over" into an annuity.
Annuities may be non-qualified. Funds transferred into an annuity from a checking or savings account are typical examples of non-qualified funding sources.
There are several types of annuities, such as the following:
- single premium or multiple premium,
- immediate or deferred,
- fixed or variable.(1)
A Fixed Index Annuity (a.k.a. Equity Indexed Annuity) is a type of fixed annuity, available as a single premium or multiple premium product.
Retirement Income with an Fixed Index Annuity
Many people want safety and guarantees for their accumulated retirement funds, yet, they want better than average earnings. That's why a Fixed Index Annuity is the accumulation vehicle of choice for so many people.
A Fixed Index Annuity can provide safety, guarantees, and the potential for market linked returns. But note that an annuity is not an investment in the stock market!
A Fixed Index Annuity provides the features of a traditional Fixed Annuity, plus gains linked to a stock market index. Features such as these:
- Guarantee of premium
- Minimum interest rate guarantee
- Power of tax-deferral
- Potential to avoid probate
- Potential of stock market-linked growth
- Lifetime income available
A Fixed Index Annuity can offer guarantees such as a minimum surrender value, a minimum guaranteed interest rate, and earnings that are locked in annually.
With an annuity, your money grows faster because you earn interest on dollars that would otherwise be paid in taxes. Your premium earns interest, the interest compounds and the money saved in taxes earns interest. With this tax deferred feature, you accumulate more money over a shorter period of time and consequently earn more.
Probate is the legal process that a deceased person's estate is subjected to. The objective is to transfer assets to beneficiaries and conclude the financial affairs of the deceased. Probate proceedings are viewable by the general public, and the process can require months or years to conclude. Annuities may avoid probate, because the proceeds go directly to your named beneficiaries at death.
A Fixed Index Annuity provides potential of stock market-linked growth without the risk of any market-type loss. Compare a stock or mutual fund vehicle (where the investor bears the market risk) with a Fixed Index Annuity. The protections provided by the Fixed Index Annuity are very significant.
Some of the market indices used to measure the earnings in a Fixed Index Annuity are these:
- Dow Jones Industrial AverageSM
- Dow Jones EuroSTOXX 50®
- Lehman Brothers U.S. Aggregate Index
- NASDAQ-100®
- Russell 2000®
- Standard & Poor's 500®
- Standard & Poor's Midcap 400®
Most, if not all, annuities have features and penalties related to withdrawals and surrenders. These features vary widely, so ask your agent for more information.
Remember that all Fixed Index Annuity products are different to some degree.
For More Information
For more information about annuities and related financial products, visit Safe Money Places.
For more information about annuities and retirement plans, visit LifeHappens.org.
To learn more about annuities from two companies available through Liberty Assurance Group, visit American Equity and Conseco.
Download "Buyer's Guide to Annuities" by the National Association of Insurance Commissioners (NAIC).
Download "Retirement Plans" by Midland National Life (REV 02-10; pub. # 8944Y).
Visit the Internal Revenue Service (IRS) to search for publications about 401k's, IRA's, and more.
1. "Buyer's Guide to Fixed Deferred Annuities" (revised February 2002) National Association of Insurance Commissioners as advertised on their Internet site at "www.naic.org" on November 1, 2008