Income Annuities

A secure source of retirement income

With medical advances and healthier lifestyle choices, people are living longer – and are looking for dependable sources of income during their retirement years. Annuities can be an ideal solution.

What are income annuities?

With income annuities, you make a lump sum premium payment to an insurance company. In return, the company guarantees to pay you a certain amount for a given period of time – either for a specified number of years or for as long as you live.

Unlike traditional investments, you don’t have to worry about managing your investments or the ups and downs of the market since your payments are guaranteed.

You may want to consider a life annuity if:

  • You’re a Canadian looking for a source of guaranteed lifetime income, typically for retirement
  • You’re interested in supplementing other sources of guaranteed lifetime income such as Canada Pension Plan (CPP), Old Age Security (OAS) or a defined benefit pension
  • You want an “income floor” to ensure you have enough guaranteed income to pay your basic essential living expenses

Income Annuity options

Single Life Annuities

  • Provides income for as long as you live
  • If you choose a guaranteed period on your annuity, your income payments will be guaranteed for the selected number of years
  • If you die during the guaranteed period, your beneficiary will receive a death benefit
  • Buy an income annuity between $10,000 and $500,000 (non-registered) / $1,000,000 (registered).

Joint Life Annuities

  • Provides income for as long as you or your spouse lives
  • If you choose a guaranteed period on your annuity, your income payments will be guaranteed for the selected number of years
  • Buy an income annuity between $10,000 and $2,000,000

Single Life Annuities

  • Provides income for as long as you live
  • If you choose a guaranteed period on your annuity, your income payments will be guaranteed for the selected number of years
  • If you die during the guaranteed period, your beneficiary will receive a death benefit
  • Buy an income annuity between $10,000 and $500,000 (non-registered) / $1,000,000 (registered).

Registered and Non-Registered Annuities

  • Purchase the right annuity depending on whether your funds come from a registered or non-registered plan
  • Annuities purchased from RRSPs, locked-in RRSPs, RRIFs, LIFs or pension plans are considered registered annuities
  • For registered annuities, all annuity income paid out in a calendar year is taxable to the owner in the year the payment is made.
  • Non-registered annuities are purchased with money that has not received the tax sheltering advantages of an RRSP or RRIF
  • If your annuity qualifies, we can issue a non-registered annuity on a prescribed tax basis which provides for level taxation over your lifetime
  • Buy an income annuity between $10,000 and $2 million
  •  

Benefits of Payout Annuities

Guarantee Your Retirement Income

Depending on the Payout Annuity you choose, you can receive guaranteed income for life (for just yourself, or for both you and your spouse) or for just a specific time period.

Your payments are locked in the moment you purchase a Payout Annuity. You don’t have to worry about what the market does or where interest rates go. Your income is guaranteed.

Minimize Your Taxes

When purchased with non-registered funds, the interest portion of your monthly payment is spread out evenly over the Payout Annuity’s life. This levels out your tax payments and minimizes the taxes you pay.

Provide Security to Loved Ones

You have the option to continue your payments to your spouse or beneficiary if you pass away during a certain time period.

Any death benefits from your annuity that are made to your beneficiaries do not have to go through probate, a lengthy process by which a court formally approves a Will. This means:

  • Your loved ones receive the money faster
  • Your estate remains private
  • More money is passed along

Enjoy an Easy Investment

Once you purchase a Payout Annuity, your payments are locked in. You’ll never have to adjust it or make any investment decisions for it.