Are you talking to your clients about their bank CD’s?

Below is a quick guide on how some of your older clientele could benefit from an annuity versus a CD.

Investment Consideration	Non-qualified Guaranteed Annuity	Non-qualified CD
Level of Risk	Low	Low
Current Interest Rates	3.20% for 5 years	2.30% for 5 years*
Taxation	Not taxed until funds are withdrawn. Has the advantage of triple compounding interest by: – Earning interest on principal – Earning interest on the interest – Earning interest on the money that would have been lost due to income taxes	Taxed in the year the interest is earned, even if you don’t take money out
Guaranteed Principal	Yes, subject to the claims paying ability of the carrier	Yes – limited to FDIC amounts
Avoids Probate	Yes – the annuity is passed straight to the named beneficiary	No – goes through probate
Able to take cash withdrawals without penalty	Generally able to withdraw a portion of account value each year without a surrender charge	If you withdraw money prior to the maturity date, you may pay an interest penalty
Guaranteed lifetime income with additional tax benefits	Yes	No
Capable of stretching to a beneficiary	Yes	No

*according to bankrate.com

As you will have noted, there are many potential benefits to an annuity versus a CD. Contact your CPS Annuity Sales Rep to obtain a client approved piece on this topic.