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An annuity is a contract between a financial institution and an individual and is designed to convert funds, provided by the individual to the financial institution, into a stream of payments paid out to the individual over a predetermined period of time starting at some point in the future.  We endorse the explanation provided by Investopedia.

Annuity Classification

These explanations are provided in as basic of terms as possible.

Immediate annuity - This is when a lump sum is turned over to the insurance company in exchange for regularly scheduled payments to begin within one periodic payment interval from the date of the purchase transaction.  For example, if the annuity provides for annual period payments, the payments would begin one year following the purchase of the annuity.  If it provides for monthly period payments, the payments would begin one month following the purchase of the annuity.

Deferred annuity - This is when the payments are deferred until some date in the future which is longer than one periodic payment interval from the date of the purchase transaction.  The date in the future is referred to as the annuity starting date.  The time between the transaction purchase date and the annuity starting date is referred to as the accumulation period.

At Efficient Estates we currently provide mostly deferred annuities but we do have immediate annuities available.

Who are annuities best suited for?

Annuities provided through the Efficient Estates brokerage are most suitable for the individual seeking to secure protect the value of the original investment, realize stable growth and produce a guaranteed future income.  The ideal individual does not have liquidity needs.  Emergency funds and annuity funds should not be intermingled.  View the videos below for real life examples of how annuities have worked for others. Videos are courtesy of the Indexed Annuity Leadership Council.

 


Ready to find out if an annuity is the right choice for your financial goals?

Click here to schedule your appointment with Monica C. Harris.


Let's take a look at how annuities have performed for Louise Bridges, David Leeper & Frank New


Ready to find out if an annuity is the right choice for your financial goals?

Click here to schedule your appointment with Monica C. Harris.


 
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Neither Efficient Estates, Inc. nor its representatives offer legal or tax advice. Any tax compliance tests applied and any

tax-related statements made in any verbal or written presentations were based upon current assumptions only, and represent only one interpretation of

current Federal Tax Law as it relates to life insurance and annuities. Moreover, the tax treatment of life insurance and annuities is subject to change. We suggest you consult your legal or tax advisor before making any tax-related decisions.