An annuity is a financial contract between you and an insurance company that provides a guaranteed stream of income for a specified period or for life. Annuities are commonly used as a retirement income solution, offering financial stability and protection from market volatility.

If securing lifetime income, protecting assets, or reducing market risk are priorities, an annuity may be a good fit.

There are several types of annuities, each designed for different financial goals:

Income Annuities:
- Single Premium Immediate Annuities (SPIA)
- Deferred Income Annuities (DIA)
- Income Riders (attached to some deferred annuities)

Principal Protection Annuities:
- Multi-Year Guaranteed Annuities (MYGA)
- Fixed Indexed Annuities (FIA)

Each type has its own benefits, so choosing the right annuity depends on your *retirement needs and timeline*.

Yes, annuities are issued by highly regulated insurance companies and are considered one of the safest financial products available. Fixed annuities, in particular, provide contractual guarantees, ensuring your principal is protected.

However, because annuities depend on the financial strength of the issuing insurance company, it's important to choose a well-rated provider. Reviewing a company’s financial ratings and claims-paying ability is a key step in due diligence.

No, annuities are not FDIC insured because they are issued by insurance companies, not banks. However, fixed annuities are backed by State Guaranty Funds, which provide protection up to certain limits if the insurance company were to become insolvent. The specific coverage amount varies by state.

Annuities are most commonly purchased by individuals between 50 and 80 years old, as they are designed to provide retirement income and asset protection. While annuities can be beneficial at various stages of life, they are typically not recommended for individuals under 50, unless part of a long-term financial strategy.

The amount you should allocate to an annuity depends on your retirement goals and income needs. A general industry guideline suggests keeping annuity investments at 50% or less of your total investable assets.

The key is to use only the amount necessary to meet your income or protection needs while keeping enough liquid assets for other financial goals.

The process is straightforward:

1. Schedule a consultation to discuss your financial goals.
2. Review available annuity options that match your needs.
3. Select the annuity that fits your retirement plan.
4. Submit your application and complete the transfer of funds.
5. Receive your annuity contract and begin enjoying the benefits of guaranteed protection.

I’m here to guide you through every step of the process, ensuring a smooth and informed experience.

The tax treatment of annuity payouts depends on the type of account holding the annuity:

- Traditional IRA Annuities: Fully taxable as ordinary income.
- Non-Qualified Annuities: Only the earnings portion is taxable.
- Roth IRA Annuities: Tax-free withdrawals if IRS rules are met.

Additionally, how you withdraw funds affects taxation—structured annuity payments may be taxed differently than lump-sum withdrawals.

Yes, some annuities can be transferred through a process called a 1035 Exchange, which allows you to move from one annuity to another without triggering taxes. However, not all annuities qualify for this type of transfer.

If you’re considering switching annuities, let’s discuss your options to ensure it aligns with your financial goals.

Yes, under IRS Section 1035, you can transfer the cash value of a life insurance policy into an annuity tax-free. This strategy may be useful if you want to convert an old policy into a reliable income stream.

Yes, annuity contracts can be transferred, gifted, or inherited, depending on the terms of the contract. If you’re considering transferring your annuity, let’s review your specific contract details to understand your options.

Inherited annuities come with several payout options, depending on your relationship to the original owner and the type of annuity. Common choices include:

- Taking a lump-sum payment
- Opting for spousal continuation (if applicable)
- Choosing stretch payments over time

Because tax treatment varies, consulting with a financial professional is recommended to ensure you make the best decision.