Guarantees you can Live with

The words “lifetime guarantee” or money-back guarantee” are on many products we buy. But when was the last time you based your decision to buy on the type of guarantee a product offered?

In recent years, many variable annuity contracts have begun to offer certain “living benefit” guarantees. In fact, more than 85 percent of variable annuity contracts sold today offer one or more living benefit guarantees.

If you are concerned about market volatility or running out of money in retirement, you might want to learn more about the guarantees available with some variable annuities for an additional cost.

Fixing the Variables

Adding a guaranteed minimum withdrawal benefit to a variable annuity contract would ensure that the contract owner could withdraw a fixed percentage 9 usually 5-7percent) of the premiums paid until 100 percent of the premiums paid had been withdrawn, even if the contract’s underlying investments were to lose money.

A guaranteed minimum income benefit would ensure that when the contract owner is ready to collect retirement income payments for life, they would be based on a minimum payout base even if the contract is worth less than this minimum because of poor investment performance. These payments continue for life-again, regardless of investment performance.

A guaranteed minimum accumulation benefit would ensure that the contract value would not fall below a specified minimum - usually the premiums paid - after a certain number of years, regardless of how the underlying investments perform.

Withdrawals of annuity earnings are taxed as ordinary income and may be subject to a 10 percent federal income tax penalty if made prior to age 59 1/2. Surrender charges may also apply during the contract’s early years. Any guarantees are contingent on the claims-paying ability of the issuing company.

Variable annuity sub-accounts fluctuate with changes in market conditions. When an annuity is surrendered, the principal may be worth more of less than the original amount invested.

variable annuities are sold only by prospectus. Please consider the investment objectives, risks, charges, and expenses carefully before investing. The prospectus, which contains this and other information about the investment company, can be obtained from your financial professional. Be sure to read the prospectus carefully before deciding whether to invest.