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What is a Retirement Annuity?Planning for a safe and comfortable retirement? Does it feel completely out of your reach? The single most important factor for people considering retirement is not running out of money. People are living longer than ever, and are more active late into life. This longer life will require more money. Hopefully, you’ll be receiving income in retirement – a pension, Social Security, or income from savings. There is a way, however, to ensure income that you will never outlive. You can buy a retirement annuity with a portion of your nonqualified, or taxable, savings. This retirement annuity, also called an immediate annuity, is a contract with an insurance company that, in exchange for a single lump sum premium, pays you guaranteed income for life. Roger, a married 65 year old man, has just retired. He is receiving a small pension from his previous employer, and he and his wife, Maureen, receive Social Security income. Together, they receive enough income to pay bills and buy food, but with little to spare. However, Roger and Maureen prudently saved $200,000 over their working lives - $200,000 that is sitting in a money market account earning 2% interest. Additionally, they are responsible for paying income taxes on their yearly interest earnings. Roger and Maureen believe that a retirement annuity is the best choice for them. As well as paying them income for life, the monthly payments from the annuity are tax advantaged, meaning that only a portion is reportable as income and taxed. After speaking with an Annuities Specialist from AnnuityAdvantage.com, Roger purchases an immediate annuity, with joint and survivor benefits that will protect Maureen if Roger passes away. The retirement annuity will pay approximately $1200 per month for life, and if Roger dies, Maureen will receive the balance of the account paid out in monthly installments as long as she is living. AnnuityAdvantage.com offers free, personalized retirement annuity quotes – just call 1-800-239-0356 and ask to speak to an Annuity Specialist today.
¹ First year yield/rate reflects fixed rate plus premium bonus or interest rate enhancement. Interest is based on current rates and subject to change without notice.Send email to
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