Investment Opportunities

Tax Deferred Annuities

Annuities can be a good option for the basis of a solid financial plan. An annuity is an investment policy issued by a life insurance company. It offers the benefit of tax-deferred growth and the possibility of potential avoidance of probate. The investment continues to grow, but because it is tax-deferred, you don't pay interest on it until you begin making withdrawals. By postponing the taxes owed until retirement, your investment compounds faster because you are earning interest on dollars that would have otherwise been paid to the IRS. Also, if you pay taxes on it when you are retired, you are most likely at a lower income bracket. In addition, if you decide to take a monthly withdrawal, your taxes can be less because they are spread out over years of retirement.

Annuities can be either a Fixed Rate Annuity or a Variable Rate Annuity. Neither has an annual contribution limit and both have flexible payout options. With a fixed rate annuity, you are guaranteed a fixed rate of return for the term of the investment. The rate is tied to an index (such as the S&P 500). In comparison, a variable annuity has flexible investment options. This provides access to market growth and gives you the potential to earn more money than you would with a fixed annuity.

There are different withdrawal and contribution options available for both products. To find out more about annuities and other investment options contact our CFS* Financial Advisor, James Hull, at 1.800.444.5858 x2658.

Variable annuities are long-term investments designed for retirement. The value of the variable investment option will fluctuate and when redeemed, may be worth more or less than the original cost. Withdrawals and other distributions of taxable amounts, including death benefit options, will be subject to ordinary income tax, and if taken prior to age 59 1/2, a 10% federal penalty may apply. A withdrawal charge may also apply. Withdrawals will reduce the value of the death benefit and any optional benefits.

You should consider the investment objectives, risks, and charges and expenses of the variable product and underlying fund options carefully before investing. The prospectuses for the variable product and underlying fund options contain this and other information. To obtain a prospectus, please contact please contact James Hull, CFS* Financial Advisor at 1.800.444.5858 x2658. Please read and consider the prospectus carefully before investing or sending money.

James Hull, AWMA®, CRPC®
CUSO Financial Services, L.P

Portland 503.258.2658
Outside local calling areas
1.800.444.5858 x2658
jamesh@pnwfcu.org

 

 

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