What Happens When A Fixed Index Annuity Matures?
When a fixed index annuity (FIA) matures, you generally have three main options:
- Withdraw in a Lump Sum: You can choose to withdraw the entire value of the annuity in a single payment. This gives you immediate access to your funds, but it may have tax implications. The lump-sum withdrawal might be subject to income tax.
- Transfer to a New Annuity: You can roll over the funds into another annuity, which could be another FIA or a different type of annuity. This option allows your investment to continue to grow and may provide additional benefits or features not offered in your original annuity.
- Let It Continue to Grow in the Current FIA: Some FIAs offer the option to extend the accumulation phase beyond the original maturity date. This means that your money can continue to grow under the terms of the current annuity. However, not all FIAs offer this option, so it’s important to check the specific terms of your contract.
- Tax Implications: Understand how each option affects your tax situation.
- Investment Goals: Align your choice with your long-term financial goals.
- Market Conditions: Consider current market conditions and how they might impact your decision.
- Annuity Terms: Review the terms of your current annuity and any new annuity you consider.
Choosing the right option when your fixed index annuity matures depends on your financial goals, tax situation, and the terms of your annuity. Evaluate each option carefully to make the best choice for your circumstances. Contact us today for a free quote.
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