FAQ

What are M & E fees?

Mortality & Expense (M & E) fees are paid annually by the annuity contract holder to the life insurance company that issued the contract. Typically, M & E fees are about 1.25 percent of the contract's value. These fees offset the risk that the insurance company faces.

What are Qualified and Non-Qualified Annuities?

Qualified annuities are sold as part of tax qualified plans, for example Keogh, SEP, IRA and company pension plans. Non-qualified annuities are not used to fund tax qualified plans.

How Does a 'Tax Deferred' Annuity Work?

With a tax deferred annuity, the contract holder is not required to pay taxes on the annuity income until he or she opts to begin receiving payments.

What is a Surrender Period?

This is the period of time that a surrender charge applies to the sale of your contract. This period usually lasts up to seven or eight years. The first two years carry the highest charge and typically drops 1 percentage point per year for the duration of the period.

How Can I Avoid Social Security Offset with an Annuity?

You can lower or eliminate taxes on your income from Social Security by letting them grow tax free during the deferral period. You will not have to pay taxes on your annuity unless you make a withdrawal.

Is an Annuity Contract the Same as a Life Insurance Policy?

No. An annuity is just the opposite. While life insurance pays out after the death of the policy holder, an annuity offers regular monthly payments to the contract holder for the duration of his or her life.

What are the Advantages of a 401k Rollover Annuity?

The major advantages of a 401k Annuity are 1) income protection, 2) flexibility, 3) guaranteed principal and 4) death benefit protection.