Multiple investment options.
Variety of professional money managers.
Tax-free transfer privileges.
No annual contribution limits.
Option for a guaranteed lifetime income.
Guaranteed death benefit for beneficiaries.
May continue making contributions past age 70½.
Do not have to begin mandatory distributions at age
Do not have to file annual 1099 forms for capital
Avoid the expense and delays of probate for death
Earnings, when withdrawn, are taxed at your ordinary
income tax rate, as opposed to the lower capital gains
Administrative and insurance fees--also called "mortality
and expense" fees--are typically substantially higher
than mutual fund fees.
If you begin annuitization payments and die prematurely,
your account balance may be forfeited to the insurance
Although most annuity contracts allow you to withdraw
a portion of your earnings each year, any withdrawals
beyond those amounts are subject to the 10% federal
Most variable annuities impose early withdrawal charges
on withdrawals made within the first 5 to 7 years
of owning the policy.
Variable annuities are complex investments and should
only be considered upon the advice of a trusted financial