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Annuities
An annuity is a financial product offered by a life insurance company. You can purchase an annuity with a
one-time payment or with periodic payments. Annuities offer systematic withdrawals, as well as lump sums or ongoing guaranteed payments. One type of annuity provides a fixed, guaranteed return. Another type provides
a variable return tied to underlying investment choices you select. You can start taking on-going payouts from an annuity that can continue over your lifetime, or for a time period you specify. Most people
select an annuity starting date after 59 ½, to avoid IRS penalty taxes. We offer three types of annuities: Fixed, Variable and the newest, Equity Index Annuities.
Fixed Annuities
Annuity contributions must come from after-tax dollars. Annuity earnings, like pension plan earnings
, are tax deferred. Tax deferral makes a big difference. Tax deferred earnings accumulating within an annuity can increase your investment in three ways:
Interest is earned on the net premiums.
Interest is earned on the interest.
Interest is earned on the dollars that would have been paid out in the taxes every year
(assuming you invested annuity premiums in a taxable account
With fixed annuities, the rate of interest for a specified time is guaranteed. Fixed annuities are
attractive because they often credit a higher interest rate than most fixed-income alternatives.
Variable Annuities
These annuities allow investors to accumulate money for retirement using professionally managed
investment options with varying objectives and risk levels. Insurance companies often contract with investment fund companies to create and manage these separate options exclusively for variable
insurance contracts. Variable annuities provide many benefits:
A fixed account option for guaranteed interest.
A guaranteed death benefit should you die before annuity payments begin. Waiver of the contingent deferred sales charge if you become disabled, unemployed, terminally ill or confined to a qualified
nursing home or licensed hospital. Not all waivers are available in all states. Unlimited transfers among the separate account investment choices. Flexible contributions, as long as premium
payments plus the contract value don't exceed $1,000,000.
Subaccounts managed by top investment managers from Fidelity Investments®, Putnam
Investments, Northstar, Janus, Neuberger & Berman Management, Fred Alger management, and OpCap Advisors.
FUSA offers Equity Indexed Annuities the latest in single and flexible premium equity indexed annuities.
An equity indexed annuity:
Combines the safety and guarantees of an annuity with the upside potential of earning interest rates
linked to increases in the Standard and Poor's 500 Composite Price IndexMinimum initial premium No administrative fees Even if the S & P 500 Index experiences a downturn, you are guaranteed to
receive a minimum value of 90 percent of your total premiums, credited with 3 percent interest annually.
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