As an advisor, helping clients build a resilient, growth-oriented retirement portfolio is essential. Variable annuities offer a unique balance of market participation, tax advantages, and guaranteed income features, making them a valuable tool in the right financial strategy.

Variable annuities are available by prospectus. Urge your clients to read the variable annuity prospectus carefully before investing. Here’s how variable annuities can enhance investment portfolios and support long-term financial success.

1. Growth Potential with Market Participation

Unlike fixed annuities that provide stability but limited upside, variable annuities allow clients to invest in market-driven subaccounts, similar to mutual funds. This gives them the potential for higher returns while still offering protective features.

• Market-Linked Growth: Clients benefit from market performance over time.
• Optional Risk Mitigation: Riders can help safeguard principal against downturns.

Advisor Tip: Position variable annuities as a way for clients to stay invested in the market while maintaining a level of protection through optional riders.

2. Tax-Deferred Growth for Enhanced Compounding

One of the primary benefits of variable annuities is tax-deferred growth—earnings grow without immediate taxation, allowing for more significant long-term accumulation. Withdrawals may be subject to ordinary income taxes and if made prior to age 59½ may be subject to a 10% IRS penalty tax.

• Clients don’t pay taxes on gains until withdrawals begin.
• Deferred taxation allows for compounding over time, increasing potential returns.

Advisor Tip: Compare the impact of tax-deferred growth in a variable annuity versus a taxable investment account to demonstrate the advantage.

3. Guaranteed Lifetime Income Options

For clients concerned about outliving their retirement savings, many variable annuities offer optional income riders that provide a guaranteed income stream for life, regardless of market conditions.

• Lifetime income riders convert assets into a predictable income stream.
• Clients can maintain market exposure while securing essential income.

Advisor Tip: Show clients how a variable annuity with an optional lifetime income rider can act as a safety net while still allowing participation in market gains.

4. Customizable Risk Management Features

Variable annuities offer a range of optional riders, such as principal protection and long-term care benefits, which can tailor the investment to fit different risk tolerances.

• Principal protection can shield a portion of the client’s original investment from market losses.
• Additional riders may provide access to healthcare or estate planning benefits.

Advisor Tip: Help clients assess their risk tolerance and select annuity riders that align with their long-term financial goals. Explain how optional principal protection features can safeguard assets during market downturns.

5. Estate Planning and Beneficiary Protections

Variable annuities often include death benefit options, ensuring that clients’ assets pass directly to beneficiaries without probate delays.

• Guarantees¹ ensure that beneficiaries receive a set payout, regardless of market fluctuations.
• Enhanced death benefits lock in investment gains over time.

Advisor Tip: Incorporate variable annuities into estate planning discussions to highlight the advantages of streamlined wealth transfer.

Final Thoughts: Integrating Variable Annuities into Client Portfolios

Variable annuities provide a compelling mix of growth, tax efficiency, income security, and risk management—making them a versatile tool for many retirement strategies.

• Use tax deferral and market participation to enhance long-term accumulation.
• Help clients balance growth with guaranteed income options for retirement security.
• Incorporate annuity riders that align with each client’s unique risk profile.

At New York Life, we make annuities easier — helping you integrate them seamlessly into client portfolios for long-term financial confidence.

1.   Any guarantees of the variable annuity are based on the claims-paying ability of the issuer.

For producer use only-not for distribution to the public

SMRU 7585834; Expiration 01.31.2026