Yes! You can put your Individual Retirement Account (IRA) into an annuity. This process—often called an IRA rollover—is a popular option for folks looking to secure a steady income stream throughout their retirement.
You can also roll over funds from a 401(k), 403(b), or 457(b) plan into an annuity.
How This Works
When you move your IRA funds into an annuity, you’re essentially transferring your retirement savings from one tax-advantaged account to another. This can be done with both traditional and Roth IRAs.
There are two main ways to put your IRA into an annuity:
- Direct Transfer is the simplest and safest method. Your IRA funds are transferred directly from your current account to the annuity provider.
- Indirect Rollover has you receive the funds from your IRA and then have 60 days to deposit them into the annuity. Be careful with this method—it may involve tax withholding and potential penalties if not done correctly.
Benefits of Putting Your IRA in an Annuity
- Annuities can provide a steady, guaranteed income stream for life, which can be particularly appealing for retirees.
- Your funds continue to grow tax-deferred within the annuity, just as they did in your IRA.
- Some annuities offer the potential for higher returns compared to traditional savings accounts or CDs.
Next Steps
If you’re considering rolling your IRA into an annuity, we recommend the following steps:
- Compare Annuity Options. If you decide to proceed, we can help you shop around for the best annuity that meets your needs.
- Understand the Process. We’ll guide you through the rollover process, ensuring all necessary paperwork is completed correctly to avoid any undesirable tax implications.
Putting your IRA into an annuity is a significant financial decision that can offer benefits like guaranteed income, but it’s important to consider your options and seek professional support before making a choice.
We’re here to help you navigate these important retirement decisions. Contact us today to discuss whether an IRA to annuity rollover is the right move for your retirement plan.
