Navy Mutual Annuities
Immediate Annuities

What Is an Immediate Annuity?


An immediate annuity starts a guaranteed income stream right away, with payments beginning within one year of the contract purchase date. Immediate annuities are funded with a lump-sum deposit and are typically used as a tool to spread out income taxation or reduce the risk of outliving other assets.

After a one-time lump-sum deposit of $10,000 to $1,000,000, you will receive principal and interest payments monthly, quarterly, semi-annually, or annually.

Single Premium Immediate Annuities are funded through a single lump-sum payment. Often this lump sum comes from liquidating other assets, such as home equity or an investment portfolio. Single Premium Immediate Annuities are non-qualified annuities purchased with after-tax dollars.

 

  • Minimum Deposit: $10,000
  • Maximum Deposit: $1,000,000

Single Premium Immediate Annuities are fixed annuities, meaning you deposit a sum of money and receive a guaranteed principal and interest payment in the future. In addition, fixed period income payments guarantee that there is no contractual risk of principal loss. This type of annuity is low risk, but often offers a higher interest rate than a savings account or CD.

 

  • The size of income payments depends on the length of time for which you elect to receive annuity payments.
  • Guaranteed income paid out for the remainder of your life protects you from the possibility of outliving distributions from other retirement assets.

You can choose to receive guaranteed income payments in one of four ways:

  1. Fixed Period: You will receive payments for a period of one to 30 years, distributed monthly, quarterly, semi-annually, or annually. These payments will continue to you or a beneficiary if you pass away during the fixed period. Income payments cease after the fixed period is complete.
  2. Life Income with No Death Benefit: You will receive monthly payments for the remainder of your life. This payment option provides the highest monthly life contingent income amount.
  3. Life Income with Period Certain: You will receive income for the remainder of your life. You may also choose a period certain of five, 10, 15, or 20 years. If you pass away during the period certain, your beneficiary will continue to receive income payments for the remainder of the period certain.
  4. Joint and Survivor Income:  You and a joint annuitant will receive income payments until one of you passes away, after which the surviving annuitant will receive 50%, 67%, or 100% of the original income amount for the remainder of their life. The percentage of the original income payment that will be paid to the surviving annuitant is chosen at the time of purchase and affects the income amount received while both annuitants are living.

Questions? Call 800-628-6011.

Member Benefits


The Single Premium Immediate Annuity is ideal for those approaching (or in) retirement who want to safeguard their savings from market volatility and begin receiving income payments immediately. It is ideal for those who do not already have or would like to add to a guaranteed lifelong income stream (such as a pension or Social Security income). Additionally, our Single Premium Immediate Annuities provide a:

  • Guaranteed Interest Rate – Interest rates are based on the size of your premium deposit and the length of time you will be receiving income payments; if you choose a life income payout option, this length is determined by your life expectancy. Regardless of your payout option, you won’t have to pay taxes on the principal contribution used to fund your annuity, only on interest earnings.
  • Guaranteed Principal Deposit – Fixed period income payments guarantee that your principal deposit will not suffer losses and will be repaid to you (or a beneficiary) in full.
  • Free Look Period – You can take up to 30 days to confirm that this annuity is right for you.

Navy Mutual provides affordable life insurance and annuities to those who serve (or have served) our nation. If you are an active duty, reserve/guard, or retired servicemember in any branch of the United States military or uniformed services, we’d be honored to serve you and your family.

Annuity Basics

If you are ready to learn the basics of annuities, start here. Then, when you are ready to set yourself up with guaranteed income, you can schedule a consultation with a representative.

Annuity Payout Options

Navy Mutual offers five payout options that provide income in different ways. This decision should take into consideration the reason you decided to purchase the annuity in the first place.