Annuities

Individual annuity sales in the first quarter of 2023 topped $94.1 billion.1 But what are they, exactly? An annuity is part of a financial planning strategy you get from an insurance company in the form of a contract. You either pay a single upfront premium or make a series of premium payments (a.k.a. your principal) and then earn interest on that money.

Annuities give you the potential to grow your savings tax-deferred, and the option to convert your contract into a series of payments to supplement – or replace – your income.

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Annuities: How smart people
fund their retirement pay for their kid's college cover unexpected expenses protect their dreams build wealth adopt pet rhinos
Annuities: How smart people fund their retirement pay for their kid's college cover unexpected expenses protect their dreams build wealth adopt pet rhinos

Aspida is rated “A- (Excellent)” by AM Best2 and “A-” by KBRA3, both with a stable outlook.

Why an annuity?

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Protection of
Your Principal

The money you put towards your annuity, as well as the interest earned, is protected from loss for the length of your contract.

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Interest-Earning
Potential

Depending on the type of annuity, you can either earn a guaranteed rate of interest or potentially earn more in exchange for some risk.

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Grow Your Money
Before Taxes

You don’t have to pay income taxes until you start getting payments, so your principal can grow tax-deferred.

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Guaranteed &
Predictable Income

According to the type of contract, you either get a lump sum or multiple payments from the annuity at the end of your term.

Flexibility & Security

Annuities are a great choice if you are looking for a way to see your money securely grow over time. Unlike IRAs and other retirement plans with income and contribution limits, anyone can own an annuity and fund it as they see fit. As an insurance product, the guarantees and payments from an annuity are backed by the strength and security of the issuing insurance company. So, you can rest assured that we’ve got your back.

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What type of annuity is right for you?

Fixed Annuities

Fixed annuities offer a secure, low-risk way to grow tax-deferred money for retirement. Fixed annuities, like a multi-year guaranteed annuity (MYGA), are a great choice as part of a diversified retirement portfolio, and will allow you to grow money safely for a period of time until you’re ready to use it. Growth is based off the compounded interest rate of the annuity, and the value of your contract will increase steadily throughout its term.

Since there is no market risk associated with a fixed annuity, your principal (the money you put in at the start of your contract) is guaranteed to grow at a fixed, steady rate, making a fixed annuity a great place to put money you want to protect before retirement.

Consider a Fixed Annuity if:

  • You have money to invest for a specific period of time
  • You want a low-risk, secure way to let your money grow steadily
  • You want to plan for your future and that of your loved ones
  • You want to protect your principal, and enjoy tax-deferred growth
Learn About Fixed Annuities
chart diagram showing fixed annuities

Fixed Index Annuities

While not an actual investment in a stock index, the performance of fixed index annuities (FIAs) is tied to specific underlying stock indices. Your money grows according to either a fixed rate or the performance of the indices you choose - or both. If you choose to allocate your money to the available indices, your money won’t grow uniformly as with a fixed annuity, but it will grow in relation to how the indices you choose will grow, with the potential for higher yield at the end of your term.

But what if the market has a downturn? That’s the beauty of an FIA. This type of product protects your principal from dips in the market and retains its year-start value, even when stocks and other more volatile investment options lose value. And once the market has another positive year, so does your annuity.

Consider a Fixed Index Annuity if:

  • You have money to invest for a specific period of time
  • You are comfortable with your money growing with the market, tax deferred
  • You want upside gains with a level of protection from market volatility
  • You want to protect your principal
Learn About Fixed Index Annuities
fixed index annuity chart

How does an annuity stack up? 4

Fixed Annuities

  • Provider
  • Growth
  • Beneficiaries
  • Principal Protection
  • Tax Advantaged5
  • Lifetime Income

Fixed Annuities

  • Provider
    Insurance Company
  • Growth
    Guaranteed rates, typically higher than CDs
  • Beneficiaries
    Assets passed without probate
  • Principal Protection
    ok icon
  • Tax Advantaged 4
    ok icon
  • Lifetime Income
    ok icon

Certificates of Deposits

  • Provider
    Bank
  • Growth
    Guaranteed rates, typically lower than MYGAs
  • Beneficiaries
    Requires probate to pass assets
  • Principal Protection
    ok icon
  • Tax Advantaged 4
    none icon
  • Lifetime Income
    no icon

Fixed Index Annuities

  • Provider
    Insurance Company
  • Growth
    Positive return based on selected indices
  • Beneficiaries
    Assets passed without probate
  • Principal Protection
    ok icon
  • Tax Advantaged 4
    ok icon
  • Lifetime Income
    ok icon

Mutual Funds

  • Provider
    Broker
  • Growth
    Based on performance of selected investments
  • Beneficiaries
    Requires probate to pass assets
  • Principal Protection
    no icon
  • Tax Advantaged 4
    none icon
  • Lifetime Income
    no icon

Retirement Planning with Purpose

Meet Dale

Guaranteed to Rock On

Dale's Game Plan

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Dale's Game Plan

Meet Larry

Planning for the Unexpected

Larry's Game Plan

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Larry's Game Plan

Meet Marie & Jack

Safeguarding Your Legacy

Their Game Plan

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Marie & Jack's Game Plan

Footnotes

1Source: LIMRA as of June, 2023.

2As of April 28, 2023. A.M. Best A- (Excellent) is 4th out of 13 possible ratings.

3As of September 28, 2023.

4Source: LIMRA as of June 30, 2021 and Ares observations as of December 31, 2021.

5Certificates of Deposits and Mutual Funds can be tax advantageous when held in a qualified retirement account but are less tax advantageous when held outside of a qualified retirement account.

Legal Disclosure

Guarantees are backed by the claims-paying ability of Aspida Life Insurance Company (“Aspida”). Annuities are designed for long-term accumulation of money; surrender and withdrawal fees may apply on early withdrawals. Annuity withdrawals are subject to income tax, and withdrawals prior to age 59½ may also be subject to an IRS penalty.

The statements and comments offered in this communication are provided as general information and ideas. They are not intended to be, nor should they be relied on as, investment, legal, tax advice, or recommendations. Before making a decision or giving advice about any matter contained in this communication, agents or individuals should consult their own attorney, tax, or investment advisor.

Products and services are underwritten and/or provided by Aspida (Administrative Office: Durham, NC), licensed in 49 states (excluding New York) and the District of Columbia. Products and services may not be available in all states.

Not FDIC/NCUA Insured • May Lose Value • Not Bank/CU Guaranteed • Not a Deposit • Not Insured by Any Federal Government Agency