Annuities for Retirement Income Security
What Is an Annuity?
An annuity is an insurance product designed to provide a guaranteed stream of income, either immediately or in the future. You pay a premium—either as a lump sum or in installments—and the insurance company promises regular payments, often for life or a set number of years. Fixed annuities, including fixed deferred and indexed annuities, offer principal protection and predictable growth without the risk of losing money in the stock market. Fixed indexed annuities provide growth linked to a market index, but with a cap or participation rate and no risk of market losses. We focus on these types of annuities for safe, reliable retirement planning—not variable annuities, which involve investment risk.
Is an Annuity Right for You?
Annuities are best for conservative investors who want steady, guaranteed income or need to cover essential expenses in retirement. They offer valuable stability and protection, but it’s important to know about liquidity limits—many annuities have surrender periods and penalties for early withdrawals. We recommend keeping emergency funds outside your annuity to maintain flexibility. Annuities can be a smart part of a retirement portfolio for those who want safe, predictable income without taking investment risks.
Types of Annuities We Offer
Fixed Deferred Annuities
Accumulate savings safely with a guaranteed interest rate over a set term, much like a CD alternative. Ideal for conservative savers seeking steady, risk-free growth before they need income.
Fixed Indexed Annuities
Grow your money based on a market index (such as the S&P 500) while ensuring you never lose principal to market downturns. These products balance upside potential with security.
Immediate & Deferred Income Annuities
Turn a lump sum into a reliable, guaranteed monthly income for life or a set period. You can start payments right away or defer them until later—offering flexibility and peace of mind in retirement.
Benefits of Annuities
Guaranteed Income for Life
Certain annuity options provide income you cannot outlive, protecting against the risk of outliving your savings.
Tax-Deferred Growth
Your earnings grow tax-deferred until you make withdrawals, allowing you to potentially accumulate more over time before paying taxes.
Protection from Market Downturns
Fixed and fixed indexed annuities shield your retirement funds from market crashes, so you never lose principal due to a bad year on Wall Street.
Our Approach to Annuity Recommendations
True North Associates takes a client-first, fiduciary approach to annuities. We shop multiple insurers to find the best rates and features for your age, retirement goals, and risk tolerance. Our process ensures you never allocate too much of your assets to annuities—our focus is on balance, security, and meeting your personal needs. We explain every option in plain English, so you can decide with confidence.
Frequently Asked Questions About Annuities
What happens to my annuity if I need the money early?
If you withdraw funds from an annuity before the end of its surrender period, you may face surrender charges and, if under age 59½, potential tax penalties. Some annuities offer free withdrawal options or waivers for emergencies like nursing home care. We always help you understand the rules and plan for flexibility. Proper allocation ensures you have other assets available if you need cash quickly.
Can an annuity help pay for long-term care if needed?
Certain annuities offer riders that increase income or allow penalty-free withdrawals if you require long-term care. Some policies let you convert value into higher monthly payments in the event of chronic illness or disability. While not a substitute for traditional long-term care insurance, annuities can provide a backup source of funds. We’ll review these features and explain when they make sense for your plan.
What is the difference between a fixed and indexed annuity?
A fixed annuity credits your account with a set interest rate each year, providing guaranteed growth. An indexed annuity links your growth to a market index, such as the S&P 500, offering more upside but with limits on gains. Both guarantee that you will not lose money due to market downturns. The choice depends on whether you value higher potential returns or absolute predictability.
Secure Your Retirement With Peace of Mind
Annuities can bring lasting stability to your retirement, turning savings into a paycheck you can rely on. With the right product and strategy, you’ll enjoy income certainty and protection from market risk—key ingredients for a confident retirement. True North Associates is here to guide you, compare options, and recommend only what truly fits your needs and goals.
Ready for a Personalized Annuity Review?
If you’re considering annuities as part of your retirement plan, schedule a consultation with True North Associates. We’ll answer your questions, explain product differences, and find the right fit for your future.
