What is an Annuity?
An annuity is a unique financial vehicle designed to help people accumulate money for many goals such as education, house down payment, vacation and retirement. An annuity can also be used to turn a lump sum of money into a guaranteed stream of income for life. You have an option to begin receiving the income at a future date or immediately.
Individual Savings Annuity
An Individual Savings Annuity (ISA) is an investment offered through the Canadian insurance industry. Similar to Guaranteed Investment Certificates (GICs), it offers payment to you at the maturity of the investment. Prior to maturity, it allows you to grow savings with a number of investment term options, including a daily interest account and various guaranteed interest accounts. An ISA may be registered as a RRSP, providing immediate tax credits and deferring tax on interest earned.
A small initial lump sum and regular monthly contributions can accumulate quickly. The value within the annuity grows (accumulates) as deposits are made and as it earns interest. Our ISA features two savings accounts:
- Daily Interest Account – Interest compounded daily.
- Guaranteed Interest Account (GIA) – Interest compounded annually and guaranteed for investment terms from nine months to five years.
Additional ISA Features
- No front-end charges
- Estate Protection: Upon your death, funds remaining in your account may go directly to your beneficiary; they are not subject to probate fees. Registered funds left to a spousal beneficiary continue to defer income tax until they are received as income
- Bonus Interest: Additional 1/4% bonus rate for Guaranteed Interest Accounts with a policy value exceeding $50,000; when the policy value totals $100,000 or more, you’ll receive an additional 1/4%, and a third 1/4% for accounts over $200,000 – bringing your potential total bonus interest to 3/4%. (Bonuses apply to subsequent deposits and reinvestments. Bonuses are not part of the policy contract and may be changed at any time)
- Potential Creditor Protection: When you name an eligible or irrevocable beneficiary, your ISA may be safeguarded from creditors
- RRSP eligible
- Charges may apply if you surrender funds from a GIA before the end of its term
Single Premium Annuity
If an inheritance, financial settlement, or your accumulated retirement savings leaves you with a substantial sum of money, our Single Premium Immediate Annuity (SPIA) can provide guaranteed lifelong income.
- The SPIA provides regular income payments for life or for a specific term (period of time)
- Choose an income schedule that suits your needs: monthly, quarterly, semi-annually or annually
- Receive income payments of $50 or more
- Begin a SPIA with a minimum of $10,000
- RRSP eligible
- Income payments must begin within 10 months of your SPIA purchase
Choose the income option that’s best for you:
- A Single Life Annuity without a Guaranteed Period provides income for life.
- A Single Life Annuity with a Guaranteed Period provides income for life; however, if you die before the end of the guaranteed period, payments are made to your beneficiary for the remainder of the period.
- A Term Certain Annuity provides income for a specified term only.
- A Joint & Last Survivor Annuity without a Guaranteed Period can provide lifelong income for a married couple; annuity payments may be reduced upon the first death.
- A Joint & Last Survivor Annuity with a Guaranteed Period provides a married couple with income for life; annuity payments may be reduced upon the first death. However, if both individuals die before the end of the guaranteed period, payments are made to the beneficiary for the remainder of the period.
Get an Annuity
Talk to a FaithLife Financial Representative to learn about investment solutions that are right for you.