Fixed Annuity

A fixed annuity is designed to help investors plan for their retirement by offering a tax-deferred vehicle to encourage long-term savings. A fixed annuity credits a declared interest rate, which is reset annually after the initial guarantee period. A minimum interest rate is guaranteed for the life of the contract. Annuity earnings grow tax deferred until withdrawn, reducing your current tax liability and allowing your money to grow faster.

Features

  • Grow assets on a tax-deferred basis*

  • Fund it using pretax dollars in a qualified retirement account or with after-tax dollars in a non-qualified account

  • Guaranteed minimum interest rate regardless of market conditions

  • Flexible income options1

  • Access to your interest earnings immediately

  • Individual account features may allow access to your funds under certain conditions without penalty2

  • Contributions can be made as one lump sum or additional deposits can be made over time

  • No age limits at which you must begin receiving payments for non-qualified money

  • A variety of payout options available at maturity, including a guaranteed lifetime option

  • Account value passes to your named beneficiary free from the costs of probate in most cases

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Considerations

  • Fixed rate of return may not keep up with inflation

  • Substantial penalties may apply for early withdrawal

  • Guaranteed life income payments cannot be altered once selected

Tax Considerations

  • Earnings accrue tax deferred*

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Income Limits

  • No limits

Eligibility Limits

  • No limits

Annual Contribution Limits

  • No contribution limit if money is non-qualified

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Disclosures:
 

*Commerce Financial Advisors does not provide tax advice or legal advice to customers. Consult a tax specialist regarding tax implications related to any product and specific financial situations

1Withdrawals of earnings are subject to ordinary income tax. In addition, a federal 10% penalty may apply to withdrawals taken prior to age 59 ½ and surrender charges may apply. Consult your tax/legal advisor for tax planning relating to your current situation.

2The availability of withdrawal features without penalty will vary by product.