Important details about annuities or IRAs

According to data provided by the Centers for Disease Control and Prevention (CDC), in 2021 in the United States, the life expectancy for men was 73.2 years, and for women, it was 79.1 years.

Most people calculate how much money they will need for their retirement by considering their life expectancy. But most cases are wrong, and their calculation is very low. Buying a savings plan, such as annuities or Individual Retirement Accounts (IRA), is a good way to secure a reserve of money and a guaranteed income when they retire.

What should you know?

An annuity is a contract between an insurer and a person, in order to increase their money and protect it without risk of loss at the end of the chosen term, and offer a guaranteed stream of income for a specific period or for life.

They work as reserves of money that are nourished during the years in which the person was productive. Once they reach retirement or turn 60 years old, they have access to their contribution, and to the profits they have earned in interest and in increasing the value of their annuity.

They provide a contributory benefit, such as the 401(k) or pensions. The total contribution or premium is deducted from the gross income adjusted for Puerto Rico income tax purposes, within the established limits. An IRA deduction is allowed on the income tax return, up to a maximum of five thousand dollars ($5,000).

When you acquire an annuity, it can benefit you as an individual and also your spouse. You can set up an IRA for your spouse of they do not work, while protecting your retirement. Tax terms for married people who file a joint payroll will have a maximum allowable deduction of up to $10,000. Each spouse can set up their own IRA, even if one of them does not earn an income, and thus benefit from the maximum deduction.

Once you acquire the annuity, you commit to both making contributions in the determined period, and to keep that money and its earnings within the IRA. This commitment is precisely to fulfill its function as a retirement savings plan.

Could you withdraw the money frequently before retirement? If absolutely necessary, yes. You can receive part of the money before the age of 60, but this would have penalties, unless certain exceptions are applied.

Anyone, with a maximum of 75 years of age at the end of the tax year, who receives a profit attributable to a profession or occupation, or who receives income from salary, or compensation for rendering professional services, is eligible to acquire an IRA.

Annuities allow you to enjoy the benefits of investing in the stock market, without the risk of loss. Whether through a fixed or indexed annuity, both will provide interest-based growth, the only difference being that one will have a fixed interest and the other will fluctuate on a market basis and with downturn protection.

Once you meet the age and contribution requirements, the company with which you made the annuity contract will start paying you for the rest of your life. The accumulated balance can be received in a lump sum or in installments.

TOLIC gives you more for your IRA

When it comes to saving for your retirement with an annuity or IRA, it is important to have a financial advisor to guide you on which one is right for you. Selecting a reliable and solid company is crucial.

TOLIC offers you 2 IRA, and 2 annuity plans so you can see your investment grow faster:

· Fixed IRA: Your investment grows with a guaranteed interest.

· Indexed IRA: Potential to increase your profit based on index growth and with market downturn protection.

· Fixed Annuity: For more return on your money.

· Indexed Annuity: For further growth of your retirement savings.

For more information, visit our website or email us to contact one of our representatives ( And find out why, at TOLIC, we Give you More for your IRA.


Top posts

Related Publications

Service hours
Monday to Friday
8:00 a.m. to 5:00 p. m.

Fax: (787) 620-2713

Toll Free: 1 (800) 981-8662
Email us to contact a customer service representative.

En TOLIC tenemos la obligación de enviar la Informativa 480.7F, a todos los clientes comerciales y cuenta propistas, para los pagos de prima de Aportaciones a planes de salud o accidentes durante el año Contributivo 2023.

Si usted no necesita esta información, puede cerrar esta ventana oprimiendo el botón de la X.