A Single Premium Deferred Annuity
Even if you’re already contributing the maximum amounts allowed by law to your 401(k) and IRA accounts, you could still be saving even more for retirement by adding the Future Income Plus Annuity.
- “Single premium” means you fund the annuity with a lump sum payment
- “Deferred” means you start receiving income more than 12 months after we receive your payment
A Single Premium Deferred Annuity is often used for:
- A rollover from a previous employer's 401(k) or other qualified plan due to job change or retirement
- Maturing Certificates of Deposit
- Accumulated funds from other investments
- An inheritance or lump-sum payout
Did you know?
Many customers who are interested in Estate Liquidity or Legacy Planning, and have purchased a State Farm Survivorship Universal Life Policy, or a Single Premium Whole Life Policy have also expressed interest in this type of annuity.
Why buy State Farm Future Income Plus?
- Our Single Premium Deferred Annuity is backed by the financial strength of State Farm Life Insurance Company (all states except NY and WI), or State Farm Life and Accident Assurance Company (NY and WI only)
- You can allow your accumulation value to keep growing and choose when you begin receiving payments. You can wait until you are age 95 (age 90 in NY) or 10 years from your issue age, whichever is later
- There are no up-front sales charges or policy fees deducted from your single premium. Your entire premium earns interest
- Interest earned is generally income tax-deferred
- In addition to taking the accumulation value as a lump sum, you will have several income options, including guaranteed monthly income for your lifetime
- Withdrawal Flexibility - If withdrawals on a policy year basis are 10% or less of your single premium in the 1st year or 10% or less of the accumulation value at the end of the prior policy year, there are no surrender charges*
*Distributions that exceed the 10% amount may be subject to surrender charges and a market value adjustment. Most withdrawals are subject to income tax and a 10% tax penalty if taken before age 59 1/2. The minimum withdrawal amount is $500. Up to 4 withdrawals per year are allowed. Please see your tax advisor for more information.
Premiums
Initial premiums can vary by age and guarantee period. Contact your State Farm agent for information regarding the availability of this product and for policy details on minimum premium requirements, coverage, costs, and restrictions.
Income Payment Options
This Single Premium Deferred Life Annuity allows you to accumulate money with interest until a future date. Then, when you retire, you can take the accumulation value in one sum or choose from a number of income payment options, including:
- Life Income: Income is guaranteed for your lifetime
- Life Income with Choice of Certain Period: Income is guaranteed for the greater of the certain period (amount of time your payments are guaranteed to last) or your lifetime. Certain periods from 5 through 20 years are available
- Joint & Last Survivor Life Income: Income is guaranteed for the greater of your lifetime or your joint annuitant's lifetime
- Joint & Last Survivor Life Income with Choice of Certain Period: Income is guaranteed for the greatest of your lifetime, the joint annuitant’s lifetime, or the certain period. Certain periods of 10, 15, or 20 years avaliable
Contact your State Farm agent for details on additional income options that may be available to you.
Interest Rates
Your single premium will earn interest at the current interest rate that State Farm has established.
Interest rates are guaranteed for a period of time called the Interest Rate Guarantee Period.
- A higher interest rate may be available for a larger single premium
- At the end of each guarantee period, you have a 30-day window to choose another guarantee period from those guarantees available at that time
- A higher interest rate may be available for larger accumulation values at renewal
Please contact your State Farm agent for the current interest rates and the minimum guaranteed interest rate.
Tax Advantages
Interest earned on the Future Income Plus accumulation value is generally federal income tax-deferred. This means it is not subject to federal income tax until it is received. Because of this, the annuity accumulation value can grow larger than would be possible if interest were taxed as it is earned. See your tax advisor for individual tax advice.
Some annuities are used to fund a tax-qualified plan. These tax-qualified plans can include:
- Business Retirement Plans
- Traditional IRAs
- Roth IRAs
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You may access your accumulation value at anytime. However, surrender charges and a market value adjustment may apply. A surrender charge is a fee owed upon premature withdrawal from the annuity. A market value adjustment is an increase or decrease in the value of the annuity based on current interest rates when a premature withdrawal occurs. The minimum withdrawal amount is $500. Up to four withdrawals per policy year are allowed. Please see your tax advisor for more information.
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| Policy Year |
Percent (%)of Accumulation |
Value For NY (%) |
| 1st |
9% |
7% |
| 2nd |
8% |
6% |
| 3rd |
7% |
5% |
| 4th |
6% |
4% |
| 5th |
5% |
3% |
| 6th |
4% |
2% |
| 7th |
3% |
1% |
| 8th |
2% |
0% |
| 9th |
1% |
– |
| 10th+ |
0% |
– |
-
This adjustment will depend on how prevailing market interest rates have changed since the beginning of the guarantee period, as well as the amount of time remaining in the guaranteed period. In general:
- If prevailing interest rates have risen, the adjustment may decrease the amount available (subject to policy-defined floor)
- If prevailing interest rates have fallen, the adjustment may increase the amount available (subject to policy-defined ceiling)
- The longer the amount of time remaining in the guarantee period, the greater the adjustment will be
-
State Farm waives surrender charges and the market value adjustment in the following situations:
- Withdrawal or surrender occurs during the 30-day window following the end of each guarantee period (limitations may apply for shorter periods)
- If withdrawals, on a policy-year basis, are 10 percent or less of your single premium in the first year or 10 percent or less of the accumulation value at the end of the prior policy year in later years
- Death of the annuitant if a death benefit is payable
- Qualifying terminal illness (refer to policy for definition)
- Qualifying nursing home or hospital confinement (refer to policy for definition)
- A life income option is chosen after one year
Policy Series Wording Information
IL-131.14