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A flexible premium deferred annuity built for you

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What is a flexible premium deferred annuity (FPDA)?

A flexible premium deferred annuity (FPDA) helps you build retirement savings with steady, predictable growth. You can contribute on your own timeline, earn a guaranteed fixed interest rate, grow your savings tax-deferred and convert them into lifetime income when you're ready to retire.

Each contribution earns a fixed interest rate, guaranteed for 12 months. After that, your rate will be set annually, with a built-in minimum that lasts the life of your contract. That means your savings can keep growing, even when the market doesn’t.

How do deferred annuities work?

It’s as simple as funding, waiting, and then planning for income.

Start with a minimum initial contribution of $5,000. You can add more anytime – consider setting up automatic transfers from your bank account to ensure consistent contributions. Over time, your additional contributions will help increase the growth potential of your savings.

Once you’ve funded your annuity, the next step is to let your savings grow. Each contribution you make will earn a fixed interest rate for 12 months, providing a predictable return on your investment. After the initial 12-month period, you will receive a new annual interest rate, allowing your funds to continue growing. This means your money works for you, accumulating interest as it sits in your account.

As soon as you’re ready, you decide how and when to begin receiving payments. For instance, you might choose to start payouts later in retirement to ensure a steady income stream during your advanced years.

Choose the payout structure that best suits your needs:

  • Lifetime income: You’ll receive payments for as long as you live.
  • Life with period certain: Lifetime payments with a guaranteed minimum payout period. If you pass away before the end of the certain period, payments will continue to your beneficiary for the remainder of the certain period.
  • Period certain: Guaranteed payments for a set duration only, regardless of how long you live.
  • Joint and survivor: Payments continue for your spouse if you pass away.

Is an FPDA right for you?

The FPDA offers a unique blend of flexibility, tax advantages and the option for future income.

The FPDA is ideal for people who are thinking about long-term growth, not short-term spending.

With an FPDA you can make ongoing, continuous contributions.

Each contribution earns a guaranteed interest rate for 12 months, so your savings grow steadily, regardless of market swings.

After your first contract year, you can withdraw up to 10% of your account value per year without a penalty – other withdrawals are subject to a surrender charge.

When you’re ready, you can choose to annuitize – turning your accumulated savings into a steady, predictable income – or withdraw your money as a lump sum; however, surrender charges may apply.

With its built-in protections and guaranteed growth, the FPDA is well-suited to those who value security.

Other annuities to consider

An FPDA isn’t right for everyone. But that doesn’t mean an annuity isn’t right for you.

I plan to fund my annuity with a single lump-sum payment

Consider an Amica Multi-Year Guaranteed Annuity (MYGA)

I want to start receiving payments right away

Consider an Amica Single Premium Immediate Annuity

How are deferred annuities taxed?

One of the benefits of a deferred annuity is how it helps your money grow more efficiently. With tax-deferred growth, you don’t pay taxes on the interest or earnings as they accumulate. Instead, your earnings stay in your account, compounding over time.

 

How your annuity is taxed depends on how you fund it

Qualified annuities

These are funded with pre-tax dollars, like rollovers from a 401(k) or IRA. Since the money hasn’t been taxed yet, your entire withdrawal amount — both the original contributions and the earnings — will be taxed as ordinary income when you begin receiving payments.

Early withdrawals

If you withdraw funds before age 59½, you may owe a 10% IRS penalty in addition to regular income taxes.

What are the terms of an FPDA?

Amica’s FPDA gives you more control and stability as you save for retirement. But it’s important to understand how it works.

Minimum initial contribution: FPDA requires a $5,000 minimum first-year contribution.

Flexible contributions: You’re not locked into monthly payments. You decide when and how much to add, which gives you room to adjust as life changes.

Interest rate structure: Each new contribution earns a fixed interest rate for 12 months. After that, the rate is subject to renewal based on current rates.

Withdrawal access: After the first year, you can withdraw up to 10% of your account value annually without a penalty (required minimum distributions excluded).

Surrender charges: If you withdraw more than the allowed 10% annually, or cash out early, you may face surrender charges.

Income options: You can choose how to receive payments: for life or the greater of life and a fixed number of years, over a fixed number of years, or through a joint and survivor option.

Death benefit: Depending on your chosen payout structure, a death benefit may be available to your beneficiaries.

Availability: Product features may vary by state.

There is more to learn about annuities

Discover the ins, outs, and everything in between.

Want to learn more?

Our annuity representatives are here to help you choose the right annuity for your goals.
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