Consider annuities to meet your income goals.


Annuities can be an important part of your retirement strategy. They provide regular payments, steadying the flow of retirement income, and typically offer tax-deferred growth of earnings.

Depending on your needs, an annuity may help you save for retirement, protect your savings from loss, and may include a death benefit that will pay your beneficiary a specified minimum amount.

Immediate annuities: fixed and variable

Fixed immediate annuities provide income as soon as one month after investment at guaranteed rates or payouts. Variable immediate annuities operate similarly except the payout may vary based on underlying investment performance.

Deferred annuity: fixed and variable

A deferred annuity allows for a one-time payment or flexible premium payments over a period of time to accumulate savings on a tax-deferred basis.

Fixed annuity

A fixed annuity has a minimum guaranteed fixed rate of return for a specific number of years. These policies may also include a bonus for premiums deposited.

Fixed indexed annuity

An indexed annuity is a fixed annuity, either immediate or deferred, that earns interest or provides benefits that are linked to an external stock or bond index or indexes. Two of the most common indexes used for these types of annuities are the Standard & Poor’s 500 Composite Stock Price Index (the S&P 500), which is an equity index, and Barclays, a top-rated bond index that may be used as the underlying account in an indexed annuity. The value of any index varies from day to day and is not predictable. Most indexed annuities have a floor component that the value of the annuity cannot fall below.

Variable annuity

Variable annuities are long-term, tax-deferred investments to help you save for retirement. Variable annuity earnings are contingent upon the performance of the underlying investments held by the annuity.

While variable annuities have the potential to help protect against inflation — and the underlying investments may grow over time — the investor bears the investment risk, as returns are based on the performance of both the financial markets as well as the performance of the underlying investment options.

Today’s variable and indexed annuities offer both guaranteed death benefit and income enhancements, generally called riders, despite poor market performance. These enhancements typically are offered for an additional cost that can vary widely, and any guarantees are based on the financial strength and claims-paying ability of the insurer.

If you decide to take your money out early, however, the amount of your death benefit and the contract value may be reduced.

If you’re looking for another retirement income source, annuities may be right for you. 

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Insurance products are offered through insurance companies with which Waddell & Reed, Inc., has sales arrangements.

Annuities are long-term financial products designed for retirement purposes. Annuity and life insurance guarantees are based on the financial strength and claims-paying ability of the issuing insurance company. The guarantees have no bearing on the performance of a variable investment option. Variable investment options are subject to market risk, including loss of principal. There are charges and expenses associated with annuities and variable life insurance products, including mortality and expense risk charges, management fees, administrative fees, expenses for optional riders and deferred sales charges for early withdrawals. Withdrawals before age 59½ may be subject to a 10% IRS tax penalty and surrender charges may apply. Enhanced death benefits and living benefits are offered for an additional cost.

Please remember that an Investment in an underlying fund Involves risk. Investment return and principal value of an underlying fund Investment will fluctuate, and shares, when redeemed, may be worth more or less than their original cost

You should consider the investment objectives, risks, charges and expenses of an underlying fund and the variable insurance product carefully before investing. The underlying fund prospectuses and variable insurance product prospectuses (available from your financial advisor or applicable insurance company) contain this and other information. Please read the prospectuses carefully before investing.

This information is provided for informational and educational purposes only. Waddell & Reed believes the information has been obtained from sources considered to be reliable, but does not guarantee the accuracy of the information provided. This information is not meant to be a complete summary or statement of all available data necessary for making financial or investment decisions and does not constitute a recommendation.

Please note that the information provided may include references to concepts that have legal, accounting and tax implications. It is not to be construed as legal, accounting or tax advice, and is provided as general information to you to assist in understanding the issues discussed. Neither Waddell & Reed, Inc., nor its Financial Advisors give tax, legal, or accounting advice.

This information is not meant as financial or investment advice pertaining to your personal situation. The selection of appropriate investment, insurance or planning options and/or strategies should be made on an individual basis after consultation with appropriate legal, tax and financial advisors. Nothing contained herein is intended as a solicitation or an offer to buy or sell any product or service mentioned and they may not be suitable for all investors.

Securities offered through Waddell & Reed, Inc., Member FINRA/SIPC, are not insured by FDIC, NCUA or any other government agency, are not deposits or obligations of the financial institution, are not guaranteed by the financial institution, and are subject to risks, including the possible loss of principal. Insurance products are offered through insurance companies with which Waddell & Reed has sales arrangements. Guarantees provided by insurance products are subject to the claims-paying-ability of the issuing insurance company.

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