Educational guide · Not an insurance illustration
How to read an annuity illustration
Annuity rates reset too often for any honest website to print them — so instead of a table that would be stale by the weekend, this page teaches the thing that never goes stale: how a real illustration works, what is actually guaranteed, and what to bring so the call produces your own numbers.
Important educational disclaimer — please read
This page is educational only — it is not an insurance or annuity illustration, not a quote, not an offer, and not a recommendation. It deliberately shows no rates and no growth or income projections. The only dollar figures are typical market minimum-contribution context assembled from publicly available 2026 sources — NOT our own reference tables and NOT any specific product.
- Actual annuity terms depend on the carrier, product, state, your age, the contribution amount, rate conditions on your application date, and the riders you elect.
- Guarantees are backed by the claims-paying ability of the issuing insurance company and live in the specific contract — read the guaranteed column of a real illustration first.
- Surrender charges, market-value adjustments, and rider fees vary by product and can materially change outcomes.
- Moving qualified money (IRA/401(k)) or exchanging an existing policy has tax and suitability rules — a licensed professional walks through both before anything moves.
- This page contains no company logos, product names, or carrier information. It is designed for general consumer education only.
- Always obtain a personalized, carrier-specific illustration from a licensed insurance professional. Annuities are subject to state regulations and carrier approval.
What a real annuity illustration shows
- Every honest annuity illustration has a GUARANTEED column — the contract minimums the carrier is obligated to honor, backed by its claims-paying ability — and a NON-GUARANTEED column built on current rates or index assumptions. Read the guaranteed column first; the other column is an example, never a promise.
- The illustration shows your contribution (a lump sum, a series of payments, or a transfer from an existing account), the surrender-charge schedule — the declining penalty for taking money out early, typically over the first 3–10 years — and any rider charges.
- For income-focused designs, it shows when payments could begin and how the payment is calculated — single life, joint life, period certain — under both columns.
- Rates shown on any illustration are the rates in effect the day it was run. Carriers reset rates regularly, which is one reason a fresh illustration from a licensed agent beats anything printed on the internet.
The three shapes annuities come in
Fixed / multi-year guaranteed (MYGA)
A lump sum earns a rate the carrier locks in writing for a set term, commonly 3–10 years — the annuity cousin of a bank CD. What that rate is depends on the carrier, the term, and the deposit size on the day you apply.
Fixed indexed (FIA)
Interest credits link to a market index, limited by caps and participation rates, with a floor protecting against index losses. The same honest-limits math as IUL crediting: the floor is real, and so are the limits on the upside.
Immediate / deferred income (SPIA · DIA)
A contribution converts into a stream of payments — starting now (immediate) or at a chosen future date (deferred). The trade: payments in exchange for giving up access to the lump sum.
What funding one typically looks like
- Most deferred annuities set minimum initial contributions in the $10,000–$25,000 range; some carriers price better rate tiers at $50,000 or $100,000 and up.
- Money usually arrives one of three ways: savings (non-qualified), a transfer or rollover from an IRA/401(k) (qualified), or an exchange from an existing annuity or life policy (a 1035 exchange, which has its own suitability rules).
- Contributions are commitments — surrender-charge schedules mean this is money you plan to leave working, not an emergency fund.
What this page is NOT
- Not a rate promise. Any rate you read anywhere — including this site — is stale the day the carrier resets it. Rates live on the carrier-specific illustration run for you, on your date, at your contribution size.
- Not a growth or income projection. This page shows none on purpose: what an annuity might credit or pay over decades depends on rates, caps, riders, and elections that no one can promise in advance.
- Not a liquidity product. Surrender charges make early exits expensive; anyone who might need the money back soon should hear that plainly before signing anything.
- Not tax advice. Qualified vs non-qualified money, 1035 exchanges, and income timing all carry tax consequences — those questions belong with a licensed tax professional.
What to bring to the call
- The statement for any money you are considering moving — savings, CD, IRA/401(k), or an existing annuity (for an existing annuity, the current surrender schedule matters most).
- Your timeline: when, if ever, you want income to start, and what you want to happen to the money if you never take income.
- Your liquidity picture: what stays reachable in savings after the contribution, honestly sized.
- Your questions in writing — especially "what is guaranteed?" and "what does it cost to change my mind?" A good illustration answers both in the guaranteed column and the surrender schedule.
Key takeaways
- The guaranteed column is the annuity. Everything else on an illustration is an example.
- Rates are dated the day they are printed — comparing a fresh, carrier-specific illustration beats comparing internet numbers every time.
- Surrender schedules make annuities commitments, not parking spots. Size the contribution so your reachable savings stay comfortable.
- The right annuity question is rarely "what is the best rate" — it is "what job is this money doing, and what is guaranteed while it does it."
- Bring statements, your timeline, and written questions to the call — twenty minutes with your own numbers beats hours of internet research.
The personalized illustration on your own numbers — guaranteed column first — always comes from a licensed agent.
Annuities usually enter the picture alongside retirement-income planning — see the retirement, legacy & maxed-savings conversation →