For the money you can’t afford to lose.
Most retirement savings advice is about growth. At some point the question changes to protection — how do you keep what you’ve built, and how do you turn it into income that doesn’t run out?
Annuities are one answer, and a good one for part of a portfolio. They’re also frequently oversold and bought by people who didn’t understand what they were giving up. We’ll walk you through both sides.
THE PLAIN VERSION
A contract with an insurance company. Nothing more complicated than that.
You give the company a sum of money. In exchange, they contractually agree to do something specific — pay you a fixed rate for a set number of years, credit interest based on a formula, or pay you an income for the rest of your life.
The guarantees in that contract are backed by the financial strength of the issuing insurance company. That’s why the carrier’s rating matters, and why we show you the ratings alongside the rates rather than only the rates.
WHO THIS TENDS TO FIT
Approaching or In retirement – typically 55 to 75, with savings that need to last
Money sitting in a CD or savings – earning less than it could
Rattled by a market drop – wanting part of your savings out of that question entirely
A retiree without a pension – building income that doesn’t depend on market timing
Holding an old annuity – out of surrender and worth comparing to what’s available now
THE TYPES
What we place.
Multi-Year Guaranteed Annuity (MYGA)
A fixed rate guaranteed for a set number of years — commonly three, five, or seven. The insurance industry’s version of a CD, with tax deferral on non-qualified money. The simplest product here and the easiest to compare.
Fixed indexed annuity
Interest credited based on an index, with a floor — typically zero, so a down year credits nothing rather than a loss — and a cap or participation rate limiting the upside. You are not invested in the market; the index is a measuring stick.
Fixed annuity
A guaranteed minimum rate with a current rate the carrier can adjust within contractual limits. More flexible than a MYGA, less predictable.
Income annuities (SPIA and DIA)
Exchange a sum for a guaranteed stream of income, starting now or at a future date. The most direct way to turn savings into a paycheck. The trade-off is real: in most cases you give up access to the principal.
What we don’t sell
We don’t place variable annuities. Those are securities, they carry market risk to your principal, and they require a securities license. If a variable annuity is genuinely what you need, we’ll tell you that and point you toward someone properly licensed rather than steering you into something we can sell.
THE HONEST PART
Every annuity involves a trade. Here’s what you’re trading.
Liquidity
Surrender periods commonly run three to ten years. Most contracts allow a free withdrawal each year, often around 10%. If you might need the whole balance in three years, this is the wrong place for it.
Upside
An indexed annuity’s cap or participation rate means you won’t capture the full return of a strong market year. The floor is what you’re paying for, and the cap is the price.
Simplicity
Indexed products have crediting methods, caps, spreads, and participation rates that can change over time. They require reading, and we’ll read them with you.
Rider costs
Optional guaranteed income riders carry an annual fee, often deducted from contract value. They can be worth it. They are not free, and the fee applies whether you use the benefit or not.
Market value adjustment
Some contracts adjust your surrender value based on interest rate movement. It can work in your favor or against you — worth understanding before you sign.
Access before 59½
Withdrawals generally carry a 10% federal penalty on top of ordinary income tax. That makes this a poor home for money you may need early.
WHEN WE’LL SAY NO
Sometimes the answer is don’t buy one.
You might need the money soon – Emergency funds don’t belong in a surrender period.
You’re under 59½ – Early withdrawals generally carry a 10% IRS penalty.
It would be most of what you have – An annuity should be a portion of a plan, not the whole plan.
You want maximum growth and can tolerate volatility – Then this isn’t the instrument.
You’re being told to move an existing annuity and can’t get a clear answer why – Replacing one annuity with another sometimes makes sense and sometimes only benefits whoever suggested it. We’ll compare them side by side, including the surrender charge on the old one, and tell you when staying put is better.
TAXES
INCOME
How the money is taxed.
General information, not tax advice — your accountant should confirm anything specific to you.
Three ways to get paid.
Most income options can cover two lives, so payments continue for a surviving spouse — at a lower payment while both are living.
Non-qualified money (already taxed)
Growth is tax-deferred until withdrawal. Withdrawals come out earnings-first, so the taxable portion generally comes out before your original principal.
Qualified money (IRA or 401(k) rollover)
Tax treatment follows the retirement account rules. An annuity inside an IRA doesn’t add tax deferral — the IRA already has it. Anyone selling you one primarily for tax deferral inside an IRA has told you something misleading.
1035 exchange
Moving from one non-qualified annuity to another can often be done without triggering tax. Whether it’s worth doing is a separate question from whether it’s possible.
Annuitization
Convert the contract into guaranteed payments, for a set period or for life. Highest income per dollar, and in most cases you give up access to the principal.
Guaranteed lifetime withdrawal benefit
A rider allowing a guaranteed annual withdrawal for life while keeping access to remaining contract value. More flexible than annuitization, and it carries an annual fee.
Interest withdrawals
Take the interest and leave the principal. Simplest approach, and the income moves with the rate.
WHAT TO EXPECT
How we work
The whole picture
What you have, what it’s doing, what you’ll need and when, and what a 30% market drop would mean.
Whether one fits
Including when it doesn’t, and when a smaller amount than you were considering is the better call.
We shop it
Rates vary between carriers and they move. We compare across companies and show ratings alongside rates.
We read the contract with you
Surrender schedule, free withdrawal provision, crediting method, rider fees. Before you sign, not after.
We stay in touch
Surrender periods end and rates change. We’ll be in contact well before your contract rolls into something you didn’t choose.
There’s no charge for any of this. We’re paid by the carrier.
COMMON QUESTIONS
Questions we get.
Is my money safe?
Fixed and indexed annuities protect principal from market losses — the guarantees are contractual and backed by the issuing company’s financial strength, which is why ratings matter. That’s separate from liquidity: protected from market loss, not freely accessible during surrender.
How is this different from a CD?
A MYGA is the closest comparison. The differences are tax deferral on non-qualified money, typically longer terms, surrender charges rather than early withdrawal penalties, and insurance company backing rather than FDIC insurance.
What happens when I die?
Most annuities pay remaining value to your named beneficiary, typically without probate. Income annuities depend on the payout option — some stop, some continue to a survivor, some guarantee a minimum number of payments.
Can I lose money?
In a fixed or indexed annuity, not to market performance. You can receive back less than you put in if you surrender early and incur charges, or through rider fees in a year with no interest credited.
What if I already have one?
Bring it in. We’ll tell you what it does, where it sits in its surrender schedule, and whether it’s still competitive. Often the answer is to leave it alone.
How much should I put in?
A portion, not the whole. The right amount depends on what income you need, what else you have, and how much liquidity you want to keep available.
BOOK A CONSULTATION
Tell us what you need. We’ll do the rest.
Fill out our form and we’ll contact you shortly, usually within 24 hours. If you prefer, you can also call us or text us at (203) 375-7511. We look forward to talking with you!
HOURS
Weekdays: 8:00 AM – 5:00 PM
Weekends: By Appointment Only
Medicare Disclaimer: We do not offer every plan available in your area. Any information we provide is limited to the plans we do offer in your area. Please contact Medicare.gov or 1-800-MEDICARE to get information on all of your options. Licensed in CT, SC, FL, NJ.