No-Load Annuity

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DEFINITION of 'No-Load Annuity'

A type of variable annuity that charges much lower fees and expenses than traditional annuity contracts. No-load annuities are seldom if ever sold by brokers or commission-based planners because they do not pay a commission to the salesperson. These contracts usually have little or no back-end surrender charge associated with them.

BREAKING DOWN 'No-Load Annuity'

No-load annuities are generally marketed directly by the issuing insurance company or through fee-based financial advisors. Investors who purchase these contracts directly from a carrier can generally expect a fairly low level of customer service. For this reason, they are probably most appropriate for experienced investors who understand the characteristics and use of annuities, and can allocate their assets among the subaccounts themselves.

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RELATED FAQS
  1. What are the best ways to sell an annuity?

    The best ways to sell an annuity are to locate buyers from insurance agents or companies that specialize in connecting buyers ... Read Full Answer >>
  2. How are non-qualified variable annuities taxed?

    Non-qualified variable annuities are tax-deferred investment vehicles with a unique tax structure. After-tax money is deposited ... Read Full Answer >>
  3. Can a variable annuity be rolled into an IRA?

    You can roll qualified variable annuities, such as other qualified retirement plan accounts, into a traditional IRA. Non-qualified ... Read Full Answer >>
  4. Are variable annuities subject to required minimum distribution (RMD)?

    Variable annuities are insurance contracts that provide tax-deferred growth of assets that can later generate a guaranteed ... Read Full Answer >>
  5. What does a high turnover ratio signify for an investment fund?

    If an investment fund has a high turnover ratio, it indicates it replaces most or all of its holdings over a one-year period. ... Read Full Answer >>
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