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Variable Annuity

By far the most popular contract in the annuity family, a variable annuity gives you the most investment flexibility and opportunities for long-term growth. First introduced in the late 1970s, variable annuity contracts were designed to appeal to more aggressive investors who also wanted the benefits of annuity tax deferral.

A variable annuity offers a range of investment options to give a policyholder control over where his or her money is invested. Variable annuities are similar to mutual funds in their equity and/or bond investment strategies. Each investment portfolio option is managed by a professional money manager, and you can mix and match investment portfolios by freely transferring money from one portfolio to another without tax consequences.

Variable annuity performance will vary based on the returns of the underlying portfolios. However, most variable annuity contracts also offer a fixed or guaranteed account option so you have the flexibility to allocate some of your assets to a conservative investment option.

Variable annuities are designed for retirement and offer tax-deferred growth. As such, money withdrawn from a variable annuity before age 59½ may be subject to a 10% federal tax penalty.

 Immediate Annuity

 Fixed Annuity

 

 Variable Annuity

 

 Variable Annuity Advantages & Disadvantages

 

 

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