Deferred Annuities

Deferred annuities delay payments of income until the investor elects to receive them. This type of annuity is the most popular investment vehicle as it allows the capital to grow tax-free for the longest period possible. A deferred annuity has two main phases, the savings phase in which money is invested into the account, and the income phase in which payments are received.

Like all annuities, deferred annuities are a contract with an insurance company, not a direct holding of shares in a company. The contract for a deferred annuity is set up so that you contribute money by paying premiums over various intervals. A deferred annuity is a very safe investment--the insurance company is required to retain reserves that are equal to or greater than the total value of your policy (principal plus interest minus any early withdrawal fees).

Receiving Payments
The insurance company then converts the current value of your premium payments into a series of payments. Here, too, there are options. You may choose to have a lump-sum payment, or guaranteed income for life. The distinct advantages of deferred annuities are that you can spread your tax liability over the life of your income payments, and you can move a portion of your money between annuities annually.

At AnnuitySearch.com, we have been in the annuities market for over 35 years. We understand its ins and outs, its complications and its benefits. Getting the right fit for the right customer is the name of the game with annuities. If you are ready to make the smart investment of a deferred annuity, give us a call and let us see how we can help you today.