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Vanguard - annuities through Vanguard - compare your annuity choices for retirement income
 
 
  
 

Compare your annuity choices for retirement income

Vanguard offers three choices if you're looking to create income for retirement: an immediate (income) fixed annuity, an immediate variable annuity, or a deferred variable annuity with a Guaranteed Lifetime Withdrawal Benefit (GLWB) rider.*

 

Immediate fixed annuities through Vanguard Annuity Access™ in collaboration with the Income Solutions® platform

Immediate variable annuity through American General Life Companies

Deferred variable annuity with GLWB rider through the Vanguard Variable Annuity

Who should consider these types of annuities? Investors who want a steady stream of payments for life or for a specified number of years. Investors willing to accept variable payments for life or for a specified number of years based on the annuity's underlying investments. Investors who want guaranteed income for life, the potential for investment gains, and control of their assets.
How will my money be invested? In the issuer's general fund. In your choice of Vanguard stock, bond, and money market investment options. In your choice of any one or more of three designated Vanguard investment portfolios.
What are the costs? There is a one-time transaction fee equal to 2% of your annuity purchase amount. The quote you receive is net of this fee. The average annual cost is 0.80%. The Vanguard Variable Annuity's average annual cost of 0.58% is more than 70% below the industry average.** There is an additional 1.20% annual fee for the GLWB rider.†
Will I have access to my initial investment?†† No, you surrender any claim to the principal in exchange for the annuity guarantee. Yes, shares of the principal can be redeemed at any time, but changes in the share balance can affect future payouts. If you exceed your annual withdrawal amount, the benefit provided by the rider could be reduced or eliminated.
What guarantee do I have that I'll get the payments from my annuity contract? Payments are guaranteed subject to the claims-paying ability of the insurance company issuing the annuity.
How often can I receive systematic payments? You can choose to receive payments monthly or at another frequency.  You can choose to receive payments monthly or at another frequency. Payments after the initial payment may fluctuate. You can choose to receive payments monthly or at another frequency.
Are payments taxed? Yes, withdrawals and payments from annuities are taxed differently based on the type of assets used to purchase the annuity (qualified versus nonqualified). Please consult a tax advisor for information on how annuity taxation applies to your situation.
Can I buy through Vanguard? Yes, through Vanguard Annuity Access in collaboration with the Income Solutions platform, which can connect you to multiple insurance companies.

Get a quote
Yes, Vanguard can provide you with information on buying an immediate variable annuity from American General Life Companies.

Get a quote
Yes. Offered and administered by Vanguard, the Vanguard Variable Annuity is issued by Monumental Life Insurance Company, and in New York State only, by Transamerica Financial Life Insurance Company.

Download a Vanguard Variable Annuity application
Where can I get more information about annuities through Vanguard? Read our immediate fixed annuity brochure Read our immediate variable annuity brochure Read our deferred variable annuity brochure
Call our licensed specialists at 800-357-4720.

* Product guarantees are subject to the claims-paying ability of the issuing insurance company.

Investments in bond funds are subject to interest rate, credit, and inflation risk.

 
 
 
 

** Source: Morningstar, Inc., as of December 2012. The Vanguard Variable Annuity has an average expense ratio of 0.58%, versus the annuity industry average of 2.28%; excludes fees for optional riders. Actual expense ratios for the Vanguard Variable Annuity range from 0.46% to 0.79%, depending on the investment allocation. The expense ratio includes an administrative fee of 0.10% and a mortality and expense risk fee of 0.195%. The expense ratio excludes additional fees that would apply if the Return of Premium Death Benefit rider or Guaranteed Lifetime Withdrawal Benefit rider is elected. In addition, contracts with balances under $25,000 are subject to a $25 annual maintenance fee.

† As of May 2013, the current annualized fee for the GLWB rider is 1.20% of the Total Withdrawal Base. The rider fee for future premium payments into the designated GLWB investments could be higher or lower, but not more than the maximum of 2.0%.

†† Withdrawals before age 59½ may be subject to a 10% federal penalty tax.

Variable annuities are long-term investment vehicles designed for retirement purposes. They contain underlying investment portfolios that are subject to investment risk, including possible loss of principal.

Ratings of the insurance company don't apply to the Vanguard portfolios or provide protection against investment risk.

The Vanguard Variable Annuity is a flexible-premium variable annuity issued by Monumental Life Insurance Company, Cedar Rapids, Iowa (NAIC No. 66281), and in New York State only, by Transamerica Financial Life Insurance Company, Harrison, New York (NAIC No. 70688). Form No. VVAP U 1101 (in Florida, Form No. VVAP U 1101 (FL), and in New York, VVA NY 0208(R13)). GLWB Rider Form No. RGMB 43 0811 (in Florida, RGMB 43 0811 (SI)(FL), RGMB 43 0811 (JT)(FL), and in New York, RGMB 43 0811 (SI)(NY)(REV), RGMB 43 0811 (JT)(NY)(REV)). Return of Premium Death Benefit Rider Form No. VVA RP 0811 (in Florida, VVA RP 0811 (FL), and in New York, VVA RP 0811 (NY)(REV)) without agent representation. Policy and rider form numbers may vary by state and may not be available in all states. The Vanguard Group administers the Vanguard Variable Annuity for the issuer. Its variable annuity and investment costs rank among the lowest in the industry, according to Morningstar, Inc., December 2012. The Vanguard Group, Monumental Life Insurance Company, and Transamerica Financial Life Insurance Company do not provide tax advice. Investors are encouraged to consult a tax advisor for information on how annuity taxation applies to their individual situations.

This webpage is not approved for advertising in Oregon, and may not be approved for Georgia, Mississippi, or Oklahoma.

Vanguard Annuity Access is offered in collaboration with Hueler Investment Services, Inc., through the Income Solutions platform. Income Solutions is a registered trademark of Hueler Investment Services, Inc., and used under license. United States Patent No. 7,653,560. Vanguard Annuity Access is provided by Vanguard Marketing Corporation, d/b/a VMC Insurance Services in California.

The Immediate Variable Annuity is issued by American General Life Insurance Company, Wilmington, Delaware, and in New York, by The United States Life Insurance Company in the City of New York (USL). Master Group Form No. 11GVIA1000, Certificate No. 16GVIA1000, Individual Contract No. 16IVIA0403. In New York, Master Group Form No. 21GVIA1000, Certificate No. 26GVIA1000. These product specifications are not intended to be all-inclusive of product information. State variations may apply. Please refer to the annuity contract for complete details. USL is authorized to conduct insurance business in New York. Annuities and riders not available in all states.

An investment in a money market fund is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. Although a money market fund seeks to preserve the value of your investment at $1 per share, it is possible to lose money by investing in such a fund.

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