Proceeds from annuities pass directly to your beneficiaries without the delay, expense, and publicity of probate in most states. If you’ve ever had a loved one’s estate go through this time-consuming legal process, you know just what kind of advantage this is.

Because you do not pay taxes on earnings every year, your annuity is able to work harder thanks to tax-deferral. You will have to pay taxes on earnings when you withdraw your annuity’s gains, but at least you can decide when that happens.

Contributions to other retirement savings vehicles, like 401(k)s and Individual Retirement Accounts, are strictly limited. Annuities, however, offer tremendous flexibility. You can contribute as much as you want, up to the limits imposed by the insurer, to take advantage of tax-deferral or variable accounts inside the annuity. Plus, you can add to your annuity contract at any time.

Unlike 401(k)s and IRAs, which require that you begin making withdrawals at age 70 1/2, you may be able to wait much longer with annuities. When you do decide to begin receiving payments, you can usually select one of the following methods:

The money inside your annuity is made up of two components: principal and earnings. Assuming your annuity was opened with after-tax dollars, you’re only taxed on your earnings.

Usually, a simple application, a check, and your signature begins your annuity. And, at the end of each year, you will not receive a 1099 for income earned within your annuity contract.

Home | Contact Us | Careers | Branch Locator | Site Map | FAQs | Privacy Statement | Legal Information

© First South Bancorp, Inc. All Rights Reserved. Member FDIC. Equal Housing Lender.