Annuities

Grow your money now. Guarantee income for your future.

Retirement is one of life’s most exciting changes. It’s also a big financial shift—you’ll stop drawing a typical employer paycheck and instead create your own from savings.

Plan ahead so you’ll have enough to retire on your terms. A variable annuity can help.

What are variable annuities?

There are two main types of variable annuities: those used for asset accumulation and those focused on providing a source of guaranteed income in retirement. And depending on your financial goals, it’s possible to structure an annuity that can do both.

  • Both types can provide tax-deferred growth on your premiums and earnings. Gains made within the account are reinvested and also tax-deferred, which compounds your growth.
  • With no IRS contribution limits (on non-qualified money), variable annuities provide another way to save for the 30 years or more you may spend in retirement.
  • When it's time to create income from that savings, your variable annuity can help create guaranteed income that you can depend on for life.
  • Variable annuities also come with insurance death benefits that don’t require underwriting and can be used to create a financial legacy for your loved ones.

What makes an annuity different?

Variable annuities can provide:

  • another way to save for retirement with no IRS contribution limits (on non-qualified money).
  • tax-deferred growth and compounding interest on all earnings until you make a withdrawal.
  • death benefit, with no underwriting, that passes outside of probate.
  • control over investment choices.
  • flexibility to move funds between subaccounts at no charge.
  • a source of guaranteed retirement income.

Consider a variable annuity from Principal®. They can be a smart addition to your retirement income plan to help ensure you don’t outlive your nest egg.


This article is intended to be educational in nature and is not intended to be taken as a recommendation. Consult with your financial professional to discuss retirement planning. Guarantees are based on the claims-paying ability of Principal Life Insurance Company.

Withdrawals prior to age 59½ may be subject to a 10% IRS penalty tax.

Tax-qualified retirement arrangements, such as IRAs, SEPs, and SIMPLE-IRAs are tax-deferred. You derive no additional benefit from the tax deferral feature of the annuity. Consequently, an annuity should be used to fund an IRA, or other tax qualified retirement arrangement, to benefit from the annuity’s features other than tax deferral. These features may include guaranteed lifetime income, guaranteed minimum interest rates, and death benefits without surrender charges.

Annuity products and services are offered through Principal Life Insurance Company. Securities offered through Principal Securities, Inc., member SI PC, and/or independent broker/dealers. Principal Life and Principal Securities are members of Principal Financial Group®, Des Moines, Iowa 50392.