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Fixed Index Annuities – Compounding Tax Deferral Explained

Anton Hendler

One of the features of a Fixed Index Annuity (FIA) is that it grows tax deferred on a compounding basis. Essentially what this means is that your interest earned every year is not taxed but is left in the annuity to continue to grow each year and is only taxed when taken as income at some point in the future. This can be more significant than one would, at first, imagine. Let us take a simple example to illustrate the point. Let us assume that...

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