Annuities
What is an Annuity?
An annuity is a financial agreement with an insurance provider that converts a lump sum or series of payments into regular income. In simple terms, it’s a plan that helps stretch savings into dependable payments during retirement.
Annuities can be designed in several ways for our Waukesha families. Some begin paying income right away, while others grow for years before distributions start. Every plan is built to support stability and help ensure that income keeps flowing even when other resources slow down.
Types of Annuities:
Annuities come in different forms, each serving a specific purpose:
- Fixed Annuities: Offer guaranteed interest and predictable income.
- Variable Annuities: Provide growth potential based on market performance.
- Indexed Annuities: Combine security with some market-linked earnings.
- Immediate Annuities: Start paying income soon after purchase.
- Deferred Annuities: Allow funds to grow before payments begin later.
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How it works:
- You make an initial payment or a series of payments to the insurer.
- The money grows tax-deferred over time, depending on the type of annuity.
- When the payout phase begins, the insurer sends regular income checks.
- Payments can last for a set number of years or for life, depending on the contract.
Benefits
01
Tax-Deferred Growth
Earnings accumulate without yearly taxes until withdrawal.
02
Protection from Market Volatility
Fixed options provide security in uncertain times.
03
Flexible Payout Options
Choose lifetime income or a set payment period.
04
Legacy Support
Some annuities include death benefits for beneficiaries.
Why it Matters
Retirement often brings new freedom—and new questions for our Waukesha community. How long will savings last? What happens if expenses rise? Annuities help answer those questions by creating income that continues month after month, regardless of market changes. With a guaranteed payment schedule, annuities remove guesswork and reduce anxiety about financial stability. They allow retirees to focus on living well rather than worrying about running out of funds.
Annuities vs. other Retirement Tools
Savings accounts, investments, and pensions all serve a role in retirement planning. Annuities add another layer of security by guaranteeing income that cannot be outlived. While market investments may rise and fall, annuities stay steady.
They can also fill income gaps when Social Security or other sources are not enough. For many in Waukesha, combining an annuity with other retirement assets creates a well-balanced plan that blends growth with security.
Key Factors to Review:
Before choosing an annuity, consider the following:
- Income Timing: When do you want payments to begin?
- Payment Duration: Should income last for life or a set number of years?
- Growth Potential: Would you prefer a fixed rate or variable returns?
- Liquidity: Are there early withdrawal limits to review?