Strategies and Tips!

When buying a fixed rate annuity

Buy an annuity that will lock in a set interest rate for the entire duration. Many fixed annuities offer a set rate locked in for the same duration as the penalty for early withdrawal.

Consider a charitable remainder annuity trust rather than a unitrust.
This type of annuity option allows you to provide for your own financial security while setting in motion a future gift to a chosen charitable organization. This annuity option allows you to place your assets in trust. Trust assets can provide a flow of cash to you or your named beneficiary for a set time period. After this, the remaining trust assets go to the charitable organization you requested. Since the trust is not part of your estate there will be no estate taxes.

The two types of CRT accounts are:

1. Unitrust: This type allows a set or fixed percentage of funds from the trust assets are distributed to the donors. If the value of the assets in the trust increases/decreases, the amount of income will change since the same fixed percentage amount is paid to the donor.

2. Annuity trust: This is similar to the unitrust, except it provides a fixed dollar amount year after year. Any increase/decrease in the value of the trust does not affect any payments.


Split annuities divide your money into two accounts. One account is set aside and left to grow back to your original total deposit amount. The other account is set up to pay you an income stream during the same time frame. This type of plan is designed to give you current income and preserve your original deposit amount.


Immediate annuities are used for generating income, for the most part. You deposit a fixed dollar amount and receive a guaranteed income stream for a variety of different time frames. Most of these annuities credit around 3% to 5% the cash value remaining in the annuity while you receive the income. If your time frame is 10 years or longer, look at a variable immediate annuity. Because you’re working with a longer time frame you can account for the market swings and receive a larger pay out.

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Do you need another way to invest or another retirement plan? An annuity may be your answer!

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Fill out our online quote form for more information and get a FREE, no obligation price quote!