Variable Annuities (Segregated Funds)

Variable annuities (also known as segregated funds) are contracts between insurance companies and investors. They work similarly to mutual funds and have added features that insure and guarantee deposits at maturity and death.

This type of annuity is suited for you if you are interested in long-term growth for purposes like retirement planning. If you are self-employed or mature in age, segregated funds are also suited for you because of potential creditor protection and estate-strategy advantages.

Segregated funds offer the following features:

  • Separate account – Segregated funds are not part of the general assets of the insurance companies. These are in separate client name accounts belonging to policyholders.
  • Diversification – Segregated funds allow you to invest into professionally managed sub-accounts that best suit your investment needs.
  • Guaranteed death benefit – Upon death, the beneficiary is guaranteed the amount originally invested, minus proportionate withdrawals. Some age limits may apply.
  • Liquidity – Most segregated funds allow you to withdraw up to 10% of the segregated fund's value (up to 20% for retirement income plans) without penalty.
  • Privacy – Upon death, proceeds are paid directly to named beneficiaries – thereby avoiding probate and other estate settlement costs.
  • Penalties for early withdrawal – When purchased on a deferred sales charge basis, there is a redemption fee that may apply.
  • Market value fluctuation – The value of a segregated fund is subject to market value fluctuations.

We can help

At Edward Jones, we can help you reach your financial goals. Contact your Edward Jones advisor.

Important information:

Insurance and annuities are offered by Edward Jones Insurance Agency (except in Québec). In Québec, insurance and annuities are offered by Edward Jones Insurance Agency (Québec) Inc.

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