An annuity is a contract with an insurance carrier. Your annuity can cover specific goals, such as principal protection, lifetime income, retirement income, or covering medical care costs later in life. Keep in mind that an annuity is not considered an investment - it’s a contract that can have penalties if broken. However, an annuity can provide an income stream in retirement and it is a good option if you want to deposit money while protecting against stock market volatility.
How does an Annuity work?
An annuity is much like any other insurance policy: you pay the insurance company premiums (one lump sum or monthly payments, depending on the type of annuity you choose). The time you are paying premiums is called the accumulation phase where the funds grow tax-deferred during the lifetime of the contract.
Once you’re ready to draw money from your annuity, you "annuitized" the contract and turn it into an income stream, so you receive a payment on a schedule you choose (every month, every year, etc.).
How is Annuity different from a 401(K),TSP,403(B)& IRA ?
An annuity is more customized to the individual than a standard retirement savings plan. Since you’re able to choose how you want to receive money when you annuitized the contract, you have more control over the payments you receive than you would with a standard 401(k). With a 401(k), you will have to pay a fee if you withdraw money before the designated age – usually age 59.5.
Who should purchase Annuity?
Most people purchase an annuity later in life. This option is popular among people who have already maxed out their 401(k) or IRA, as it provides another tax-sheltered option to save money for retirement.
This option is generally best for individuals who want a guaranteed income stream in retirement but also want a stable option that doesn’t sway with the stock market.
Don't take my word for it. Here are what some of our current client's say about working with us.
I was unsure of how each type of fixed rate annuities allowed withdrawals and my RSF Group helped me make a choice best for my needs As a retired person
Very satisfied with RSF Group service and follow through on my investment purchase. I would highly recommend them to anyone looking for investment assistance
I highly recommend buying an annuity with RSF Group income. Marshall was so helpful that he made the whole process easy. It was a pleasure working with him.
An annuity is a long-term retirement savings product that can help protect you from outliving your money.
It has the potential to grow tax-deferred, provide death benefits to protect your beneficiaries, and offer optional living benefits to protect your retirement income.
You can choose how to fund your annuity, how interest is credited to it, and how you take payments from it.
What can it do for you?
Helps you sleep betterA fixed indexed annuity can help you save money on a tax-deferred basis and can guarantee you'll receive income for life. So no matter how long you live, you won't outlive your retirement income.
Growth potentialA fixed indexed annuity has the potential for higher interest earnings than a traditional fixed annuity with a guaranteed minimum interest crediting rate. There’s no direct downside market risk to your money if held through the withdrawal charge period.
Fills in the gapsSometimes pensions, IRAs and Social Security don't provide enough income to help you live the way you want during retirement. A fixed indexed annuity can help supplement your retirement income.
Talk to a Financial Professional about including fixed annuities in your retirement plan.
When you might need it
If you're in one or more of these situations, a fixed indexed annuity might be exactly what you need.
✓ You're saving for retirement If you're already contributing the maximum to other retirement plans, like an IRA or 401(k), a fixed indexed annuity is an attractive retirement planning option that grows tax-deferred.
✓ You won't need the money soon If you don't anticipate needing the money from a fixed indexed annuity prior to the time you turn 59½, then a fixed indexed annuity may be a good option for you.
✓ You're worried you might outlive your savings Annuities can provide guaranteed income for the rest of your life, whether you live to be 100 or even 120. It could happen.
✓ You want to leave a legacy With a fixed indexed annuity, you can provide your loved ones with a death benefit in the event of your death.
