peoples benefit life insurance company : Your Choice ?

2008-04-22 17:46:08

( Financial )



Peoples benefit life insurance company is a member of an international life insurance, pension and financial services organization. Peoples benefit life insurance offers a number of different life insurance benefits.

What is an annuity?
These are not easy to understand. You will need to know about
1. Qualified vs. Non-Qualified
2. 1035 Exchange
3. Life Insurance vs. Annuity
4. IRA: Traditional vs. Roth
5. Annuity Types:
- variable
- fixed
- deferred / immediate
- flexible / single premium
6. Required minimum distributions
7. Tax Exempt vs. Tax deferred.

Qualified vs. Non-Qualified
A qualified annuity means that pre-tax dollars fund this annuity. A pre-tax dollar funded annuity with peoples benefit life insurance company means that your contributions are a tax deduction. This lowers your present taxable income.

A non-qualified annuity on the other hand is after-tax dollar funded. This means that only the part that arises from earnings is subject to tax when distributed – not the whole amount.

You derive no other tax deferred benefit if you put any other tax-qualified funds in the annuity. When considering buying a qualified annuity you should consider other features and not tax deferral.

Life insurance vs. Annuity
Life insurance – there are different types of insurance contracts – term, universal, whole. It can be either variable financial or traditional financial product. It is a contract made between an individual and an insurance company. People benefit life insurance company will pay out a certain amount of money to the beneficiaries of the policy once the insured individual passes away – that is if the contract is still in force.

Annuity
This is a financial product and can be variable or fixed. They provide tax-deferred of your income throughout the accumulation period. Over the payment period peoples benefit life insurance company will pay an income stream to the beneficiary for a certain period. Annuities are long term products and are generally taken out by people who don’t need the money immediately.

Both of these products give the beneficiary income and security – they are different in that the income is paid out differently.

An annuity is a retirement planning tool whereas a life-insurance is a type of inheritance.


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