Features Of Annuities

Front 1

Payments made to annuitant immediately or after at
least one year.

Back 1

Immediate & Deferred

Front 2

Fixed payments/fixed interest rates;
Varying rates of interest and payments may be fixed or vary.

Variable is beneficial to help keep pace with inflation.

Back 2

Fixed & Variable Annuities

Front 3

Period of time in which an annuitant
makes payments; annuity period is also known as the annuitization period in
which withdrawals are made

Back 3

Accumulation Period & Annuity Period

Front 4

_________ account investing is typically
safe and conservative.

Variable products invest in a _________ account and
accumulate at varying rates of return due to their placement in higher risk areas.

Back 4

General Account vs Separate Account

Front 5

In a ______ plan, contributions are taxdeductible
and taxes are deferred until withdrawn.

In a ________ Plan,
contributions are NOT tax deductible, but funds increased during the
accumulation period are not taxed until withdrawn, either.

Back 5

Qualified vs Non-Qualified

Front 6

______ is purchased by an employer and
________ by one person.

Back 6

Group vs Individual Annuities

Front 7

More risk but also more potential return than a Fixed
but less than a Variable. EIA’s are in between a Fixed and a Variable Annuity.

Back 7

Equity Indexed Annuity

Front 8

Company agrees to pay a fixed rate of return
for a specific time period. However, the value of the Annuity at the time of
withdraw is adjusted by current interest rate if surrendered early. The client
shares in the risk of changing interest rates. (Bought at 7%, sold at 9% = penalty.
But sale at 5% = bonus)

Back 8

Market Value Adjusted Annuities

Front 9

Developed by Congress to help non-profits
contribute to an Annuity. Funds put here are excluded from employee’s current
taxable income rate but are taxed when withdrawn. Also known as a TDA, Tax-
Deferred Annuity or TSA, Tax-Sheltered Annuity.

Back 9

Tax-Sheltered Annuities (403b)

Front 10

Pre-Tax Contributions of up to $5000
per person if in a separate account for 2008. Taxable only when paid out.

Back 10

Individual Retirement Annuities (IRA)

Front 11

Beneficiary is allowed to attend a program of higher
education. Contributions are not tax deductible, but withdrawals are not
taxable either.

Back 11

EDUCATION IRA

Front 12

Each employee has an account
and employer (self-employed) contributes no more than 25% of salary or
$46,000 for 2008.

Back 12

SEP IRA
(Simplified Employee Pension)

Front 13

Must have
no more than 100 employees who earned $5000 or more in compensation
during the previous year. In 2008, employees can make a catch-up
contribution of $2500

Back 13

SIMPLE IRA
(Savings Incentive Match Plan for Employees)

Front 14

Contributions are not tax deductible, but withdrawals are
not taxable either. To contribute, singles must earn less than $110,000 and
married couples $160,000 and withdrawals cannot be made for at least 5
years. You CAN contribute to it past age 70 and do @OT have to withdraw
by age 70.

Back 14

ROTH IRA