How taxable & tax deferred interest compounding effects overall accumulation values. Fixed Annuities

Quick sample illustration on the effects of tax deferred compounding interest on accumulation values.

$100,000 @ 2% annually over a 5 year period
20% tax bracket
Taxable earns $10,326 ($2,065 taxes)
Tax-Deferred earns $10,408 ($2,082 taxes)

The idea with deferring the tax is a client can pick when to receive a distribution. Often when their income tax bracket is expected to be lower.

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