An annuity is a contract in which an individual agrees to pay premiums to an insurance company and receives, in exchange, a regular stream of income payments from the issuer either now or at some time in the future. Unlike many financial products available, an annuity can provide an income you can't outlive.

Tax-Deferred Growth: An annuity is a long-term financial product where interest accumulates tax-deferred. Because you do not pay taxes on annuity assets until you access the proceeds in your contract, your money grows tax-deferred. As a result, you may be able to accumulate more money than a traditional taxable product earning the same rate of return.

A Guaranteed Income: An annuity is the only product that can pay a guaranteed income for life.

May Avoid Probate: Generally, the accumulation value will bypass the costs and delays of probate, therefore more of your money will go to your beneficiaries. When the owner of the annuity dies, the accumulation value or the guaranteed minimum value (whichever is greater) will be paid to the named beneficiary.

A Guaranteed Death Benefit: Generally, annuities also offer a death benefit. While the types of death benefits differ among products, annuities allow you to pass the proceeds of the contract directly to a named beneficiary, avoiding the delay and expense of probate.

The life of an annuity can be broken down into two phases: accumulation and annuitization.

Accumulation Phase: During this phase, earnings on the contract accumulate tax-deferred. Depending upon the type of annuity purchased, it may be possible to add additional premiums during this phase.

Annuitization Phase: In this phase, the annuitant chooses a payout option and begins receiving income. Typical annuity payment options include payouts for one's lifetime, or for a specified number of years. Once the payout option has been chosen, it cannot be changed nor can premium be added after the payout period begins.

Depending upon financial goals, need for income, and other considerations, individuals may choose a fixed, indexed, deferred, or immediate annuity.

Fixed Annuity: In general, you are guaranteed a fixed interest rate that typically does not fluctuate over the duration of your contract; however, fixed annuities may credit an interest rate that is higher than the guarantee.

Indexed Annuity: Indexed annuities provide the potential to outperform traditional fixed rate annuities and avoid the downside risk of investing in the stock market. This is because interest credited to indexed annuities is based on the performance of commonly used indices such as the S&P 500 Index®* or the NASDAQ-100®**, and this interest is guaranteed to never fall below zero. The result is the potential for higher returns without any downside risk.

Deferred Annuity: A deferred annuity, primarily designed to accumulate assets for long-term financial goals, allows you to postpone, or defer, the start of your income payments until a chosen future date when income payments will begin.

Immediate Annuity: This type of annuity is designed to make payments to you shortly after your lump-sum premium payment is made. The income stream is paid periodically from the premium payment and accumulated interest earned on that premium.

*"Standard & Poor's®", "S&P®", "S&P 500®", "Standard & Poor's 500" and "500" are trademarks of The McGraw-Hill Companies, Inc. and have been licensed for use by Americo Financial Life and Annuity Insurance Company. This product is not sponsored, endorsed, sold or promoted by Standard & Poor's and Standard & Poor's makes no representations regarding the advisability of purchasing this product. The S&P 500 Index is a market-valued weighted price index which reflects capital growth only and does not include dividends paid on stocks.

**NASDAQ®, NASDAQ-100®, and NASDAQ-100 Index® are trademarks of The Nasdaq Stock Market, Inc. (which with its affiliates is referred to as the "Corporations") and are licensed for use by Americo Life, Inc. The Product(s) have not been passed on by the Corporations as to their legality or suitability. The Product(s) are not issued, endorsed, sold, or promoted by the Corporations. THE CORPORATIONS MAKE NO WARRANTIES AND BEAR NO LIABILITY WITH RESPECT TO THE PRODUCT(S).

Taxable distributions (and certain deemed distributions) are subject to ordinary income tax and, if taken prior to age 59½, may also be subject to a 10% federal income tax penalty. Additionally, some distributions may be subject to surrender charges if made during the surrender charge period.

If you're considering purchasing an annuity, it is important to consult with your financial professional for insight into the options and objectives which are best suited for you. Be sure to carefully review disclosure information when making financial decisions.

Neither Americo Financial Life and Annuity Insurance Company nor any agent representing Americo Financial Life and Annuity Insurance Company is authorized to give legal or tax advice. Tax information is subject to interpretation of current tax laws. Please consult a qualified, professional legal or tax advisor regarding the information and concepts contained in this material.

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