Can I Cash Out a Non-Qualified Annuity?

Shawn Plummer, CRPC

Chartered Retirement Planning Counselor

Can I Cash Out a Non-Qualified Annuity?

Yes, you can cash out a non-qualified annuity, but be aware of potential surrender charges. These charges typically apply to the interest earned and vary depending on the policy terms. It’s essential to understand when these charges don’t apply:

  1. Free-Look Period: Most annuities have a “free-look” period, during which you can cancel the contract without any charges.
  2. Return of Premium Provision: Some annuities include a feature that allows for a return of the premium paid without surrender charges under certain conditions.
  3. Health-Related Crisis: In cases of serious health issues, surrender charges might be waived.
  4. After the Surrender Period: Surrender charges usually apply for a set period. After this period, you can cash out without these charges.

Before deciding to cash out, it’s a good practice to

  • Check for Penalty-Free Withdrawals: Some annuities offer options for withdrawing a portion of your funds without a penalty.
  • Commutation Benefit: This option allows for a lump sum withdrawal under specific conditions, sometimes without surrender charges.

Conclusion

Cashing out a non-qualified annuity is possible, but it’s crucial to understand the terms regarding surrender charges. Consider all available options and consult with your insurance company to make an informed decision. Feel informed and ready to take the next step.

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Shawn Plummer, CRPC

Chartered Retirement Planning Counselor

Shawn Plummer is a Chartered Retirement Planning Counselor, insurance agent, and annuity broker with over 14 years of first-hand experience with annuities and insurance. Since beginning his journey in 2009, he has been pivotal in selling and educating about annuities and insurance products. Still, he has also played an instrumental role in training financial advisors for a prestigious Fortune Global 500 insurance company, Allianz. His insights and expertise have made him a sought-after voice in the industry, leading to features in renowned publications such as Time Magazine, Bloomberg, Entrepreneur, Yahoo! Finance, MSN, SmartAsset, The Simple Dollar, U.S. News and World Report, Women’s Health Magazine, and many more. Shawn’s driving ambition? To simplify retirement planning, he ensures his clients understand their choices and secure the best insurance coverage at unbeatable rates.

The Annuity Expert is an independent online insurance agency servicing consumers across the United States. The goal is to help you take the guesswork out of retirement planning and find the best insurance coverage at the cheapest rates

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