Deferred Annuity Definition: Definitions and Key Terms

There are two different deferred annuity definitions, because of the two kinds of deferred annuities. Now this is not a definition from a dictionary- rather, it’s from the school of real life, where we understand, recommend, and analyze these deferred annuities regularly at Annuity Straight Talk. Lets start by laying out both:

Tax Deferred Annuity Definition

A tax deferred annuity is a contract with an insurance company whereby the contract owner, in exchange for one or more principal payments to the company, receives future payments as per the terms of the contract.

Depending on the terms of the contract, the Company may commit to pay and guarantee, with its own funds, the availability of the future payments to the contract to holder, regardless of the actual value of the actual investment performance of the contract holder’s funds.

The contract premium grows tax-deferred while held and invested by the Company. Portions of future payments may be taxable to the contract holder.

Deferred Annuity: Single Premium Deferred Annuity Definition:

A single premium deferred annuity is a contract with an insurance company whereby the contract holder makes a lump sum, single premium payment to the insurance company in exchange for guaranteed regular future income payments.

In a single premium deferred annuity, the income payments are deferred into the future, as defined by the contract, from the time of the premium payment.

Alright, now that the background is out of the way, now what? How do you use a Single Premium Deferred annuity, or how does a tax deferred annuity fit into your financial planning?

A tax deferred annuity can be a fantastic place for safe money- no risk capital you’re relying on for retirement income- to appreciate in the years leading up to retirement.

Many life insurance companies are in the business of offering tax deferred annuities in various shapes and sizes-
Some of these are:

Group deferred annuities, which would substitute for an employer managed pension plan.
Business deferred annuity programs, which serve a similar purpose as group annuities above
Term deferred annuities, which have a specific deferred appreciation term
Guaranteed lifetime withdrawal benefit annuities
Guaranteed minimum income annuities
Index annuities with income riders
Fixed deferred annuities

And many other phrases and labels.

Just such a consultation is available, together with an in depth report on annuities complete with case studies and comprehensive analysis, at www.AnnuityStraightTalk.com . Now that you know the definition of the deferred annuity, take the next step to find out what’s right for you at www.AnnuityStraightTalk.com.

Deferred Annuity Definition – What Does Annuity Mean?

The list of terms and deferred annuity definition can go on for pages – what is more appropriate than a dictionary presentation, however, is a no cost consultation with an annuity expert who can discuss how a tax deferred annuity can help in your retirement income planning.

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