Annuity Living Benefits

Many variable annuity contracts offer “living benefit” guarantees. For an additional cost, the contract holder may be able to purchase guarantees regardless of the account value.

Adding a guaranteed minimum withdrawal benefit to a variable annuity contract could allow the contract owner to withdraw a fixed percentage (usually 5% to 7%) of the premiums paid until 100% of the premiums paid had been withdrawn, even if the contract’s underlying investments were to lose money.

A guaranteed minimum income benefit could help ensure that when the contract owner is ready to collect retirement income payments, they would be based on a minimum payout base even if poor market performance lowers the value of the underlying investments.

A guaranteed minimum accumulation benefit could help ensure that the contract value will not fall below a specified minimum after a specified term. The minimum is usually equal to the premiums paid.

A variable annuity is a long-term financial vehicle used for retirement purposes. With a variable annuity contract, one or more payments are made to an insurance company, which agrees to pay an income stream or a lump-sum amount at a later date. Variable annuities have contract limitations, fees, and charges, which can include mortality and expense risk charges, sales and surrender charges, investment management fees, administrative fees, and charges for optional benefits. Withdrawals reduce contract benefits and values. Variable annuities are not guaranteed by the FDIC or any other government agency, nor are they guaranteed or endorsed by any bank or savings association.

Withdrawals of annuity earnings are taxed as ordinary income and may be subject to a 10% federal income tax penalty if made prior to age 59½. Surrender charges may also apply during the contract’s early years. Any guarantees are contingent on the claims-paying ability of the issuing company. The investment return and principal value of an investment option are not guaranteed. Variable annuity subaccounts fluctuate with changes in market conditions. When an annuity is surrendered, the principal may be worth more or less than the original amount invested.

Variable annuities are sold by prospectus. Please consider the investment objectives, risks, charges, and expenses carefully before investing. The prospectus, which contains this and other information about the variable annuity contract and the underlying investment options, can be obtained from your financial professional. Be sure to read the prospectus carefully before deciding whether to invest.

The information in this article is not intended to be tax or legal advice, and it may not be relied on for the purpose of avoiding any federal tax penalties. You are encouraged to seek tax or legal advice from an independent professional advisor. The content is derived from sources believed to be accurate. Neither the information presented nor any opinion expressed constitutes a solicitation for the purchase or sale of any security. This material was written and prepared by Emerald. © 2012 Emerald Connect, Inc.

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Annette Hammortree, Registered Representative & Financial Advisor of Park Avenue Securities LLC (PAS), 8010 Excelsior Dr, Suite 200, Madison, WI 53717 (608)828-9800. Securities products/services and advisory services offered through PAS a Registered Broker-Dealer and Investment Advisor. Annette Hammortree, Financial Representative of The Guardian Life Insurance Company of

America

(Guardian), New York, NY. PAS is an indirect wholly owned subsidiary of Guardian. Hammortree Financial Services is not an affiliate or subsidiary of PAS or Guardian.

Neither Park Avenue Securities, Guardian, nor their representatives render legal or tax advice. Please consult with your attorney, accountant, and/or tax advisor for advice concerning your particular circumstances.