People invest in variable annuities for many reasons including the tax-deferral of earnings, the ability to name beneficiaries and avoid probate, and the growth potential of the managed sub-accounts. Variable Annuities are sold by prospectus only. Please carefully consider investment objectives, risks, charges, and expenses before investing in any variable annuity and its underlying sub accounts. For this and other information please call to request a prospectus. Please read it carefully before you invest.
Then whenever they are ready to withdraw an income from their annuity, they have the opportunity to select lifetime income payments. However, with a variable annuity you do not know what that income will be when you open the account since the future value can vary depending on the investment’s performance. Sometimes though, investors overlook an important option that may help them plan for a predictable income.
The Guaranteed Minimum Payment (GMP) option assures that you will receive no less than a specific amount of income each month, no matter what the markets do.v And if the investments go up, your future monthly income goes up too.
How the GMP is determined varies among annuity companies. One example is to base it on the greater of:
1) The value of your purchase compounded at 6% a year, or
2) The highest account balance reached on any contract anniversary date
Another version of the GMP promises that future payouts will never be less than a certain percentage, say 80%, of your first payment. For instance if your first check is for $1,000, future distributions will be no less than $800, regardless of what happens to the markets.
For more information on how an immediate variable annuity with the GMP rider can give you a lifetime income that can possibly avoid market volatility, please return the enclosed coupon.
