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Tax Deferred Annuities
Annuities are popular for two basic reasons: they offer tax-deferred long-term
saving, typically for retirement, and a lifetime income guaranteed by the financial
strength of the insurance company.
The period of saving is called the accumulation phase. In this phase, you would
make a lump sum payment or periodic payments to the annuity contract,
and these
payments would grow tax deferred until you decide to take an income stream.
When you decide to convert to a lifetime income, the terms of
the payout amounts are
structured to your needs. Your annuity may pay you a guaranteed income for life,
even if the total amount you ultimately receive exceeds the amount you put in.
A range of annuity products are available that you can modify as you proceed
through each stage in life.
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