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Annuities - A Dependable Solution (Spring 2007) << Back
Are you uneasy with the rise and fall of the stock market?  Fixed annuities can provide financial stability during your retirement years.  Because of the income they guarantee, annuities are a safe, reliable option for many people.
An annuity is a contract in which you can transfer your need for retirement income to an insurance company who will guarantee the income for you or your spouse’s lifetime.    You can fund your annuity with a lump sum or via regular payments submitted to the insurer.  In return the company agrees to pay a set income for a determined amount of years during your retirement.
One of the most attractive features of annuities is the ability to structure an income you cannot outlive. Annuities offer several payout options for you to consider.  For example, the annuitant can elect to receive income for their own lifetime, or have income guaranteed for their lifetime and that of a designated beneficiary.  If selecting payments for your life only, your income stream will be higher than if you elect a beneficiary to continue receiving payments after your death.
With annuities there is the added benefit of tax-deferred growth; earnings grow tax-deferred and ordinary income tax is due only upon withdrawal.  The same 10% tax penalty that applies to early withdrawals from qualified retirement accounts also applies to annuity distributions made before age 59 1/2.    There is also the added incentive of being able to contribute unlimited after-tax amounts and you may continue to contribute even after retirement.
When planning your estate, an annuity offers several benefits.  When you name family members as your beneficiaries they can (in most cases) receive benefits directly, without the usual wait for your estate to proceed through probate.  When you name your spouse as beneficiary, they have the option of maintaining the annuity and enjoying the tax-deferred growth on earnings.
You can use annuities as part of a two pronged approach to your retirement planning.  Since it is a guarantee, you will balance your retirement funds and be more comfortable with any fluctuations in your present IRA or 401k plans.  Feel free to consult us at AHTKY if you would like to discuss whether or not an annuity is appropriate for you.  Unlike other investments, an annuity gives you much more control over the amount of income that is generated.  With tax-deferred growth, an annuity may be the optimum way to secure your financial future.
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AHTKY Insurance Agency, LLC
1451 W. Artesia Blvd, Suite A, Gardena, California 90248
CA License: 0C46036