V—Deferred Annuity

Although the fear of dying is certainly common, many people fear living too long as much or more than they fear death. As life expectancies have increased, the problems that come with old age have become more and more visable. While we have all seen the physical challenges that come with aging, most of us have also seen the financial struggles. Many Americans have provided financial assistance to aging parents or know someone who has had to help their parents. Further causing concern is the uncertainty around Social Security and the fact that few businesses offer traditional pensions like many of our parents and grandparents enjoyed. The fear of running out of retirement income, coupled with the fear of losing control which comes with financial problems, is one of the most serious issues facing people today. The fear of living too long requires advanced planning to assure sufficient funds are available during retirement years.

Deferred annuities provide an opportunity to accumulate retirement funds on a tax-favored basis. As a flexible cash accumulation vehicle, these annuities are available with either asinglepayment ormultiplepayments over a number of years. In either case, prior to the annuity starting date, the cash values of the annuity accumulate tax-deferred, with specific contractual guarantees and at competitive rates of interest.

LIVE.For the annuitant who lives to retirement, the annuity can provide a guaranteed income for life. The actual amount of each payment will depend upon the values that have accumulated prior to retirement and the desired frequency of payments. When the deferred annuity matures, payments can be taken in a variety of ways, to include “full” annuity payments for the life of one person (the annuitant) or “reduced” annuity payments for the lives of the annuitant and another person (e.g., a joint and survivor annuity).