Chris Camburn

What Are Guaranteed Minimum Living Benefits?

Prior to about 1997, principal protection under variable annuity contracts was offered only in the case of death. In 1997 the first Guaranteed Minimum Income benefit was issued, which offered contract holders the opportunity to generate annuity income from the greater of the account value or a guaranteed minimum amount based on the premium, after …

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What Are Guaranteed Minimum Death Benefits?

If a contract owner dies in the accumulation phase, a deferred annuity contract will, at a minimum, pay the accumulation value to a named beneficiary. Sometimes the contract may be continued by the beneficiary, with the beneficiary as the new owner. The contractual payout of this benefit varies by policy and can be payable as …

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How Are Annuities Used in Estate Planning?

A variable annuity, while not designed as an estate planning tool, does offer some benefits in this area. An annuity avoids probate, provides flexibility when passing on assets to heirs, and can potentially increase the likelihood of leaving a larger estate in some circumstances. Variable Annuities Avoid Probate—A variable annuity is a contract between an …

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Should I Buy an Annuity?

Like many products available in life, annuities are not something you have to buy or invest in, but are an attractive option for someone seeking guaranteed investment growth, income, or protection of principal.* There are 3 basic types of annuities: Immediate, Fixed, and Variable. Immediate Annuity – is an annuity purchased with a single premium …

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How Are Variable Annuity Sales Charges Structured?

B-Share Variable Annuities Most variable annuity contracts are B-share products. They are offered with no initial sales charge, but cancellation of the contract during its early years may trigger a withdrawal charge known as a surrender charge. These charges typically range from 5 percent to 7 percent of premium in the first policy year, and …

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How Do I Use An Annuity for Retirement Planning?

Annuities are the only financial instruments available today, other than Social Security and pensions, that can guarantee* a lifetime stream of income during retirement. Along with giving retirees the financial confidence that comes from knowing they will not outlive their assets, annuities provide another important benefit—a way to increase current income. Many of today’s retirees …

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How Are Annuities Taxed?

If an annuity (fixed or variable) was purchased with non-qualified or after-tax dollars, a portion of each payment is considered to be a tax-free return of principal. The remainder of the payment is subject to taxation to the extent it represents earnings. Current federal income tax law specifies that the taxable portion of annuitized payments …

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What Happens to an Annuity if the Contract is Surrendered?

Deferred annuity contracts permit the contract owner to surrender the annuity contract during the accumulation period and receive a cash payment from the insurance company. This amount is called the cash value or cash surrender value of the contract. It equals the sum of premiums paid plus any earnings, minus prior withdrawals and charges deducted. …

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