Saturday April 1, 2006
Annuities, I believe, should be a core “wrapper” to hold a large part of your retirement savings. Annuities give you the advantage of deferring taxes on your investment income and gains until the annuity income is paid out some time later. So annuities function somewhat like IRA or 401(k) accounts. They give you important tax advantages with one major difference — while there are limits on how much you can put into an IRA or 401(k) each year, there are no limits on the amount of money you can lodge in an annuity.
The information and views contained in this column do not represent a recommendation or solicitation to buy or sell any particular security or fund. Past results are not a guarantee of future outcomes. Investments of any kind can result in losses. When considering any investment, you should independently judge the content, management, fees, tax implications, and risk factors of the investment and, in particular, read its prospectus and/or other offering materials.