Annuity Terms

I’ve included some annuity terms which you may hear but were not specifically addressed in this booklet.

Tax-deferred annuity or deferred annuity – While all annuities add the benefit of tax deferral to non-qualified accounts, people usually use these terms when referring to interest rate annuities. These annuities may have a guaranteed rate for the entire term (i.e. CD-type annuities) or an interest rate which changes (i.e. floating rate fixed annuities).

Single premium deferred annuity (SPDA) – This term is used to describe interest annuities that usually allow only one contribution or a “single premium”.

Flexible premium deferred annuity or flex annuity – These terms usually apply to interest rate annuities that allow more than one contribution over time.