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Term Certain or Fixed Term Annuities

Term Certain or Fixed Term Annuities

Term certain or fixed term annuities pay a periodic income for a pre-determined length of time or number of payments. In a term certain annuity you select the number of years to receive the annuity payment income stream. The shorter the time span, the higher the monthly payments. Once this period is over, the annuity payments stop and the annuity contract ends.

A person would purchase this type of annuity if a guaranteed annuity payment income stream was needed for a specific time period. When purchased with non-registered funds, the interest portion of your monthly annuity payment income stream is spread out evenly over the term of the annuity. This evens out taxation on the ongoing monthly annuity payment income stream and minimizes taxes. If the annuitant dies before receiving all guaranteed payments, the remaining payments will be paid to a beneficiary.

A term certain annuity can be used to bridge an income gap. If you become disabled before retirement you can bridge your income gap until you start receiving your retirement benefits such as CPP, Old Age Security or a company pension. The term of the annuity cannot be for an unreasonable lenght of time, there are legal limits on the number of years a term certain or fixed term annuity can be purchased for.


Annuities Are Complex Products That Require Professional Guidance

When deciding which type of annuity is best suited for you Stone-Hedge Financial Group Inc. will guide you through this process.

Stone-Hedge Financial Group Inc. will provide quotes from some of Canada’s most competitive insurance companies.


The information provided on this web site is intended for general information only. It should not be construed as legal, accounting, tax or specific insurance and investment advice. Clients should consult a professional advisor concerning their situations and any specific insurance and investment matters. While reasonable steps have been taken to ensure that this information was accurate as of the date hereof, Stone-Hedge Financial Group Inc. and its affiliates make no representation or warranty as to the accuracy of this information and assume no responsibility for reliance upon it.


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