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Annuity News

Retirement Income Options
09/17/2011

Saving money is simple, in theory, yet in execution it is never easy. If it were simple and easy to save money, there would be no need for banks and lending institutions to give credit cards, lines [ ... ]


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 Fixed Annuity – Guaranteed Income. For Life.
09/02/2011

Fixed Annuity – Guaranteed Income. For Life. There are very few guarantees when it comes to investing. But when you’re planning for the long term, a guarantee might be exactly what  [ ... ]


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Tired of Paying Unnecesary Taxes? PDF Print E-mail
Tired of Paying Unnecessary Taxes?

Many CD and Bond investors are used to paying taxes every year on the interest that they earn.   What if for some reason you didn’t have to pay the taxes on the interest you earned if you didn’t spend it?  That’s one of the main benefits and reasons people use when choosing a fixed annuity over a CD or a bond. 

When you invest in CD’s and bonds whether you spend the money or not you are going to get a 1099 and have to pay taxes on the interest you earned.  What if you purchase a 5 year CD and don’t make any withdrawals during that time, do you still pay taxes then?  The answer is yes.  Each year you would receive a 1099 from the issuing bank for the imputed interest earned in that year.  That does not seem very tax-efficient. 

Annuities and CD’s are very similar in many ways.  A CD is an insured investment purchased through a bank and an Annuity is an insured investment purchased through an insurance company.  One of the huge benefits that insurance companies can offer is tax-deferral.  Tax-deferral means that while your money remains with the insurance company (i.e. in an annuity) you don’t owe taxes on the gains.  It’s not until you take the money out of the annuity that you owe taxes on any gains.

Many annuities that we offer have the same look and feel as a Bank CD.  The major differences between the CD’s issued through banks and Annuities offered through us is that our rates are generally higher, we offer more liquidity and of course tax-deferral.

For more information please contact one of our licensed agents.