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Indexed Annuity

Index annuities are appropriate for risk-averse individuals who want near-stock market returns without actually being in the stock market. And remember, the traditional advantage of a fixed annuity apply: tax-deferred growth, a death benefit, and insurance company guarantees of principal and a minimum interest rate. Annuity earnings are taxed at withdrawal or surrender and may subject to a 10 percent penalty tax prior to age 59.

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