According to “Retiring in a positive tax climate is only half the battle,” written by Christopher Scalese for The Times-Tribune, fixed and fixed indexed annuities could be great retirement vehicles for Pennsylvania residents. They are lucky to live in a state with favorable tax codes for retirees, but Pennsylvania residents still have to find a way to maximize their retirement income. In Pennsylvania, they have a low sales tax, Social Security benefits are not taxed on the state level, and pensions are only partially taxed.
These tax benefits are a great start, but residents still need to make the most of their retirement savings and annuity products are a good way for many people to do that. Interest rates are very low on bank CD’s right now and although annuity rates are lower than they have been in the past, fixed annuity rates are higher than those of CD’s because they are offered by insurance companies rather than banks. Fixed annuities are a good way to earn interest tax-deferred and keep your money safe from volatile markets.
If you are looking for some market exposure, fixed indexed annuities give you that, but they still protect your principal from any losses. People who choose annuities are typically looking for a safe way to grow their money and ensure that it lasts through retirement. Annuities also offer tax savings that can add to the benefits already established for Pennsylvania residents. Every safe investment has terms that you should look into and annuities are no different. It’s best to speak with an expert and make sure the product is right for you.
Written by Rachel Summit
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