| | | | | An immediate annuity is a pension benefit that is payable immediately to contributors who retire at or after age 60 with at least 2 years of pension service or at age 55 with 30 or more years of pension service. | | | | If you retire because of disability before you reach age 60, you will receive an immediate annuity unless you have less than 2 years of pension service. | | | | With an immediate annuity, you begin receiving payments within one month or up to 12 months from your annuity purchase date, depending on when you want to start this income stream. When purchasing an immediate annuity, you can tailor it to fit your personal needs, which includes choosing a payment option and the frequency of the payments (monthly, quarterly, semi-annually or annually). | | | | Planning for a secure retirement involves not only accumulating assets but also knowing when and how to convert those assets into regular income. A retirement income annuity program, or Immediate Annuity, gives you the flexibility to receive a stream of income in the amount and for the length of time you choose. | |
| | | Available with either a fixed or variable annuity, Immediate Annuities are a great way to invest a lump sum from a retirement or severance package, and have the income paid out a little at a time—monthly, quarterly, semiannual, or annual—while the bulk of your assets remain invested tax-deferred. | | | | Benefits of an Immediate Annuity | - Variety of income options, including lifetime, joint, and survivor (payments continue to a named beneficiary), or period certain (a period of time specified by you).
- Choice of contract types: Fixed Immediate Annuities provide dependable and guaranteed payments regardless of market conditions, while Variable Immediate Annuities provide a fluctuating income stream that reflects the performance of the equity markets in which they are invested.
- No management or set-up fees (Fixed only).
- Income payments can be deferred for a year, or begin as soon as 30 days after you buy the policy.
- Payments of principal are received income tax free. Only the interest is taxable (provided the initial funding came from nonqualified assets).
- Ability to modify payments to accommodate inflation through a cost of living adjustment. (May not be available in all products.)
- Regular income can be used to pay utilities and other bills directly.
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