• At the annuity accumulation stage, the investor adds funds, and profits can grow due to deferred tax.
  • When the policyholder is ready to start cashing out, he can choose to withdraw funds or annuitize the contract.
  • If the policyholder chooses an annuity contract, he will choose either fixed or variable payments.
  • Variable rent sounds like that - variable. Payments are based on the performance of the annuity’s assets.
  • There is more profit potential with a variable annuity. However, during market downturns, the payout will be lower than a fixed rate annuity.