How safe are annuities?

You may be wondering “How safe are annuities?” Keep It Simple Answer: Historically Fixed Annuities have been some of the safest places on the planet to keep your money. Let’s dive into this one a little bit more. Let’s look at the 4 main types of annuities. 1)      Immediate Annuities 2)      Fixed Annuities 3)      Indexed […]

How are annuities taxed?

How are annuities taxed? Disclaimer: I am not a tax adviser. Please consult with your tax adviser before investing or making any changes. This post is for educational purposes only. Keep It Simple Answer: Annuities are tax deferred until you withdraw money. Withdrawals are taxed at ordinary income tax rates when you withdraw the money. […]

What’s the difference between an index annuity and a hybrid annuity?

ae-benefits-annual-reset-20

What’s the difference between an index annuity and a hybrid annuity? Keep It simple Answer: They are the same thing but a hybrid annuity means you added on an income rider An index annuity is a type of fixed annuity. Instead of earning a fixed rate of interest, you link your interest to a market […]

What happens to my annuity if I die?

A very common question for annuity buyers is “What happens to my annuity if I die?” Many people still believe that the insurance company keeps all their money and nothing goes to the family. That is not true at all and it’s a shame that these old thoughts still persist. Keep It Simple Answer: There […]

What are the fees with an annuity?

What are the fees with an annuity? Keep it simple answer: It depends on which annuity you purchase. In general Immediate Annuity – No fees Fixed Rate annuity – No fees Index (Hybrid) annuity – Generally no fees for base product. If you add on an Income Rider or a Death Benefit rider, there will […]

How liquid is an annuity?

How liquid is an annuity? Keep it simple answer: In general you have access to 10% of your annuity value every year without any penalties. If you keep your annual withdrawals below 10% of your current account value, you won’t have any problems with liquidity or penalties. If you anticipate needing more than 10% annual […]

What are surrender charges?

surrender-charge-5

What are surrender charges? Keep It Simple Answer: If you take out more than 10% of your annuity value in a given year, a penalty (surrender charge) will be applied to the amount in excess of the 10% penalty free withdrawal. To answer this question in more detail let’s look at 2 examples 1)      A […]