Powerful Fixed Annuity Benefits
#1) F.S. 222.14, Exemption of cash surrender value of life insurance policies and annuity contracts from legal process.
..."the proceeds of annuity contracts issued to citizens or residents of the state, upon whatever form, shall not in any case be liable to attachment, garnishment or legal process in favor of any creditor of the person whose life is so insured or of any creditor of the person who is the beneficiary of such annuity contract"...
#2) Upon death of the annuitant the proceeds are paid directly to the named beneficiaries. This is a superior beneficiary designation that CANNOT be defeated by will or trust or any legal process.
#3) The proceeds are NOT subject to probate court.
#4) The beneficiaries are afforded the same legal protection of the cash asset that the annuitant enjoyed per F.S. 222.14.
#5) Cash in the annuity grows on a tax deferred basis. The annuitant does NOT pay yearly federal income tax on the interest earnings.
#6) Triple compound interest, i.e., a) you receive interest on the principal, b) you receive interest on your interest, c) you receive interest on money that would have otherwise been paid as federal income tax, such as the interest earnings on taxable investments like bank CD's, money market accounts.
#7) Safety of principal. Fixed annuities are foundational investments and are subject to strict capital surplus cash reserves to be maintained by the issuing insurance company, 100% of the cash surrender value of a client's investment in a FIXED annuity is backed dollar for dollar by the company's capital surplus.
#8) Higher interest. Annuities traditionally pay approximately 1% to 2% more interest than taxable investments like bank CD's, money market accounts.
#9) Privacy from the IRS. There is nowhere to indicate the amount of growth or interest earned from an annuity anywhere on your tax return. Unlike most forms of income or realized growth the IRS does not know the value of your annuity or any resulting growth.
#10) Cash liquidity, 10% per year of the value of the annuity can be withdrawn without any cost, fee or penalty.