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Split Funded Annuity
What is a Split Annuity? Is my Annuity Guaranteed Against Losses?
A Split Annuity is a combination
of two annuity products.
Advantages of a Split Annuity
2) Tax-Advantaged Income: A significant portion of your monthly income from the Immediate Annuity is considered a return of your original investment and therefore is not taxable. In the example below, 81% of your monthly income payments would be Tax-Free.
3) Principal Preservation and Tax-Deferred Growth : The Deferred Annuity portion of the split-annuity concept offers tax-deferred growth and you earn an interest rate that historically has been higher than average CD rates. In addition, your original principal is restored at the end of the guaranteed period which allows you to start the process over again at prevailing interest rates.
Example of a Split Annuity
Illustration based on a
guaranteed interest rate of 5.50% for 10 years.