An annuity is an insurance contract that can protect you from outliving your money by providing a stream of income that can last your lifetime. You can almost consider it an exact opposite to a life insurance policy. Life insurance offers protection against dying too soon, and an annuity offers protection against living too long and outliving your income.
You purchase an annuity from an insurance company with a lump-sum payment or multiple payments. Your money is then credited interest and grows tax deferred. In exchange for your money, you are guaranteed periodic payments that can last your lifetime.
A deferred annuity may be the right product for you if:
A Liberty Mutual Agent2012040118340950 can walk you through a needs review and help you determine if an annuity is
right for you.
Your money in an annuity will grow tax deferred, meaning you won't pay income taxes on the growth until you withdraw it from the annuity.1 You also have several options for how you would like to receive your payments from an annuity. For example, you can elect to receive
1 Withdrawals taken before age 59 ½ may be subject to a 10% federal tax penalty as well as tax on any gain in the contract. Consult a tax advisor regarding any tax implications.
An annuity can be a helpful planning tool for some, but it isn't for everyone. For example, if the only funds you have available are set aside for short-term goals, you shouldn't use them to buy an annuity. A Liberty Mutual Agent2012040118340950 can walk you through a needs review and help you determine if an annuity is right for you.