Annuities and the Absolute Protection They Provide For YOU and Your Heirs

How can annuities protect you

Replacing your monthly paycheck with a secure income stream for life can be a challenging task for prospective retirees. This has become especially true for the Baby Boomer generation and those that follow as, pensions are no longer available to provide the financial security most Americans are seeking. Taking advantage of savings and tax deferrals offered by an employer’s 401Ks are also becoming rare as those opportunities are not offered by many small to medium size companies. The typical monthly disbursement from social security replaces just 40 percent of the average pre-retirement income for most Americans. To retire comfortably while easing financial worry, it’s prudent to have a solid plan which does not solely rely upon pension payout and 401k earnings to maintain your current lifestyle. 

tax advantages of annuities

Annuities enable you to plan for your retirement and defer paying taxes until withdrawals begin. All the money you invest in an annuity compounds annually without you receiving a tax bill from the IRS. The ability to invest every extra dollar gives you an enormous advantage over other potentially taxable investments. Taxes are due on annuity income the year they are withdrawn, and only on funds withdrawn from the annuity account.

steady stream of secure income

Once you’re ready to receive payments on your annuity investment, you have the choice to take an annual payment, bi-annually or quarterly income payments in lump sum. However, most retirees opt to arrange guaranteed, monthly payments for a set number of years or for the rest of their lives. The latter option may be preferable for those who wish to have a steady stream of guaranteed income which may compliment social security and pension plans.

death benefit

Many annuities act as a hybrid of insurance and investments. When consulting with “My Retirement Edge LLC,” you may choose to invest in a fixed indexed annuity, which can increase death benefit for a loved one. In general, the benefit will be equal to all premiums paid into the contract, plus any interest earned, less policy withdrawals. DB’s paid from an annuity bypass the probate process and are distributed directly to your heirs.

low surrender charges

Most annuities will allow you to annually withdraw up to 5 or 10 percent of your principle amount each year without incurring any fee or penalty after year one. Should you choose to withdraw more than this, there may be a declining fee for the first 7 to 10 years; after which, surrender fees may cease. Any withdraw prior to the age of 59 ½ may be subject to a early withdraw penalty by the IRS. These withdrawals will also impact the value of your benefits and total future payout.

securing your future - now

An annuity can provide future security during your retirement, and give you the guaranteed lifetime income you deserve. They allow you to save and grow  sizeable life payments, in a relatively short amount of time, which could be useful for people who are close to retirement and need to do some catching up.

long-term care

There are hybrid annuities available with a doubling feature for income if you become sick and can’t perform at least 2 of 6 activities of daily living. This additional income can be used for home health care or in a nursing home setting, for up to 5 years. For example, if your monthly income is $500, the insurance company will pay you $1000 per month, until you are well or reach the 5 year maximum for double payout. This benefit will stretch your retirement dollars, ease the financial burdens associated with long-term care,  stretch your savings and help protect your savings.

let "mre llc" guide you through the complexities of annuities

Annuities are one of many tools which can help you to secure your retirement. Although, they can be complex with many moving parts which can seem daunting at first glance. However, those extras benefit the insured and are why there’s no such thing as “one size fits all” strategy in retirement planning. Our retirement consultants can walk you through the various features and assist you in choosing an annuity which can be customized to match your particular goals and objectives.