Annuities can also accommodate tax-qualified money. A qualified annuity is used to fund a tax-qualified retirement plan, such as a traditional IRA or an HR-10. Thus, in most cases, premiums paid to qualified annuities are tax-deductible – for instance, when clients are changing jobs and have 401(k) funds to move, or already have IRAs and are seeking a more diversified portfolio. They can reduce their portfolio exposure by rolling into an annuity without losing tax advantages.
Generally, annuities are not tax efficient vehicles for transferring assets, but are useful in meeting immediate and retirement income needs. Thus, in working with wealth accumulation and retirement planning prospects, remember:
"The only person who can take care of the older person we will someday be is the younger person we are now."
Ohio National is not affiliated with, nor does it endorse or sponsor, any particular prospecting, marketing or selling system.