Guggenheim Life Preserve 5 Fixed Annuity is a single premium deferred annuity, offers multiple guarantee periods to align with your specific needs and guarantees the interest rate for that entire guarantee period.
It’s never too early to start planning for retirement.
Selecting a strategy that works best involves assessing your goals, time horizon, and risk tolerance.
A single premium deferred annuity is a product that, for a single initial investment, earns a fixed rate of interest allowing your money to grow on a tax-deferred basis until you decide to begin receiving annuity payments.
Fixed annuities are insurance products that serve a variety of needs.
You can expect solid, guaranteed growth from a fixed annuity as long as the funds remain in the annuity until the end of the surrender charge period.
With a fixed annuity, not only do you gain peace of mind, but you can be confident that what you expect is what you will receive, which is ideal for retirement planning.
Benefits and Features
Tax-deferred growth allows your money to grow faster because you earn interest in dollars that would otherwise be immediately taxable. Your premium earns interest, the interest compounds within the contract, and the money you would have paid in taxes earns interest. Income taxes are deferred until funds are withdrawn from the contract.
No-Risk To Your Principal
Premium payments, less any surrender charges, premium taxes, and applicable market value adjustment, are guaranteed by Guggenheim Life and Annuity Company.
The named beneficiary(ies) of the Preserve 5 Multi-Year Guaranteed Annuity will be paid a death benefit that is equal to the account value.
Once Guggenheim Life receives the notification of death and until the funds are distributed, the death benefit will accrue interest at a rate required by the state in which the contract is issued.
Alternatively, if the contract is continued by a surviving spouse who is the sole beneficiary of the contract, the account value will continue according to the terms of the contract.
Your beneficiary may choose to receive the payouts in either a lump sum or a series of income payments.
In the case of joint owners, the death benefit is paid on the death of the first owner.
An important feature of annuity contracts is the ability to have an income that you cannot outlive.
Guggenheim Life can provide you with a guaranteed income stream with the purchase of your tax-deferred annuity, through the ability to annuitize, which turns the deferred account into a scheduled stream of income payments.
You will have the ability to choose from several different annuity payout options that may meet your future income needs;
- to include a payout for a certain period of time,
- for your entire life with a guaranteed period,
- or for payments over the lifetime of two joint annuitants.
Preserve 5 Multi-Year Guaranteed Annuity provides a single penalty-free withdrawal each year beginning in contract year two (2).
The maximum free withdrawal amount will be 10% of your account value on the previous contract anniversary.
A penalty-free withdrawal waives any surrender charges or market value adjustment on the withdrawn amount.
Amounts withdrawn in excess of the 10% penalty-free amount will incur a surrender charge and market value adjustment, if applicable.
Surrender charges on Internal Revenue Service (IRS) required minimum distributions (RMD) exceeding the penalty-free withdrawal amount will be waived.
May Avoid Probate
By naming a beneficiary (other than your estate), your deferred annuity will be paid directly to the beneficiary, thereby avoiding inclusion in a probated estate.
This benefit may minimize the delays, expenses, and publicity often associated with probate.
Your designated beneficiary receives death proceeds in either a lump sum or a series of income payments.
Thirty days prior to the end of the guarantee period, you will have the option to elect to renew your annuity for another guaranteed interest rate period.
Depending on your circumstances and financial goals at that time, this convenient option assures you of a current, competitive interest rate and an easy transition to a new guarantee period.
We will contact you with your options and provide a 30-day window for you to make a selection.
If no election is made during this window, Guggenheim Life will automatically renew your annuity for the same guarantee period.
If a withdrawal or surrender is made within this 30-day window, no surrender charges or market value adjustment will apply.
After the 30 day window, a new guarantee period, guaranteed interest rate, surrender charge period, and market value adjustment will be applied.
Renewal rates for subsequent guarantee periods will be based on current, competitive interest rates and financial circumstances, and may differ from the initial guaranteed interest rate.
Nursing Home Care Rider
Should the need arise, the Preserve 5 Multi-Year Guaranteed Annuity will provide full liquidity to assist with nursing home care expenses subject to the rider provisions which are:
- contract purchased prior to age 76 and
- inforce for a minimum of one year,
- followed by confinement to a nursing home for 90 continuous days.
Terminal Illness Rider
If the owner of the contract is diagnosed with a critical illness (heart attack, stroke, or life-threatening cancer) or is deemed terminally ill by a physician, the Preserve 5 Multi-Year Guaranteed Annuity will provide full liquidity to assist with the additional expenses that may arise.
Eligibility is subject to rider provisions which are:
- terminal illness;
- the physician must certify that the owner’s life expectancy is nine months or less;
- for one of the critical illness conditions to take effect, the owner must be diagnosed after the contract has been inforce for at least one year;
- and the owner is not older than age 70.
Market Value Adjustment
A Market Value Adjustment (MVA) will be applied any time a surrender charge is applied.
The purpose of the MVA is, in case of an early withdrawal, to adjust the value of your funds for the change in interest rates.
The change is measured by comparing the base interest rate credited in your contract, with the base interest rates being credited by the company on current sales of the same contract form.
An upward change in base interest rates will cause a decrease in value.
A downward change in base interest rates will cause an increase in value.
The value of a negative adjustment for a 1% increase in interest rates will be the same as the value of a positive adjustment for a 1% decrease in interest rates.
The benefit of having an MVA is that Guggenheim Life can offer a higher interest rate than it would offer if the contract did not contain an MVA provision.
The MVA does not apply to penalty-free withdrawals, to the payment of a death benefit, or at the end of the guarantee period.
It will apply to withdrawals that exceed the penalty-free withdrawal amount during a guarantee period.
A surrender charge applies to withdrawal amounts that are greater than the penalty-free withdrawal amount.
Each guarantee period has its own surrender charge schedule.
The amount of the surrender charge is a percentage of your account value, which generally decreases over time as shown in the chart below.
If you renew into a new guarantee period, surrender charges will reset.
Withdrawals before age 59½ may be subject to a 10% IRS penalty tax.
Retirement Income Planning
If you’re spending the interest from a CD or a fixed annuity to supplement your retirement income, consider a deferred annuity with a lifetime income rider. These annuities would offer a guaranteed income for life (even if the annuity ran out of money), removing the concern of making your money last in retirement and running out of money.
Some lifetime income riders offer a retirement income that increases to keep up with inflation, help pay for long-term care expenses, and offer an enhanced death benefit to help your beneficiaries.