Annuities: Variable annuity, Fixed annuity, and Immediate annuity | HSBC


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What are annuities?

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Annuities1 are designed to help meet a number of long-range financial goals. They are contracts between an insured party (usually an individual) and an insurance company. In exchange for premiums paid, annuity contracts traditionally provide a guaranteed distribution of income over time, until the death of the person or persons named in the contract or until a final date, whichever comes first.

Understanding the types of annuities

By diligently researching and partnering with top-rated insurance carriers, we are able to offer our clients a range of carefully selected annuities. A financial professional1 from HSBC Securities (USA) Inc. can help you select:

  • A fixed annuity, which can provide you with a guaranteed payout based on the claims paying ability of the issuing company, either for the annuitant's life or a defined length of time. Premiums can be paid in a lump sum or in installments.
  • A variable annuity2, which will provide payouts based on the performance of the annuity's underlying investments, is similar in many respects to mutual funds. However, a typical variable annuity offers three basic features not commonly found in mutual funds:
    1. Tax-deferred treatment of earnings
    2. A death benefit
    3. Annuity payout options that provide guaranteed income for life.3
  • An immediate annuity, which is a popular choice for people who are already in retirement. Since these kinds of annuities do not have an accumulation period, your payouts can begin as soon as the contract is established.

Through a comprehensive financial review, you can learn more about the various types of annuities and work with an HSBC Securities financial professional1 to determine which, if any, may be suitable for your long-term financial goals. Please call 866.586.4722 or schedule a consultation online.

Investment and certain insurance products, including annuities, are offered by HSBC Securities (USA) Inc. (HSI), member NYSE/FINRA/SIPC. In California, HSI conducts insurance business as HSBC Securities Insurance Services. License #: OE67746. HSI is an affiliate of HSBC Bank USA, N.A. Third party whole life, universal life and term life insurance products are offered through Insurance Agents of HSBC Insurance Agency (USA) Inc., which is a wholly-owned subsidiary of HSBC Bank USA, N.A. Products and services may vary by state and are not available in all states. California license #: OD36843.

Investment, Annuity and Insurance Products:

All decisions regarding the tax implications of your investment(s) should be made in connection with your independent tax advisor.

1 HSBC Securities financial professional refers to Premier Wealth Advisors (PWA)/Premier Relationship Advisors (PRA) and Licensed Sales Professionals. PWA/PRA's provide a full suite of investment products that are available with HSBC based on individualized customer financial needs and objectives. Licensed Sales Professionals have access to more simplified product sets created to meet customers' key life-cycle needs, e.g., education, retirement, wealth transfers.

2 Investments in variable products will fluctuate and values upon redemption may be less than the original amount invested. Variable annuities are designed to be long-term investments and frequently involve substantial charges such as administrative fees, annual contract fees, mortality & risk expense charges and surrender charges. All decisions regarding the tax implications of your investment(s) should be made in connection with your independent tax advisor. When investing in tax-deferred annuities additional risks apply and may not be suitable for all investors. Early withdrawals may impact annuity cash values and death benefits. Early surrender charges may also apply. An additional 10% IRS penalty may apply to withdrawals prior to age 59 ½. If you are investing in a variable annuity through a tax-advantaged retirement plan such as an IRA, you will receive no additional tax advantage from a variable annuity. Under these circumstances, you should only consider buying a variable annuity if it makes sense because of the annuity's other features, such as lifetime income payments and death benefit protection. Features that provide lifetime income are optional and can be purchased at an additional cost. For more complete information, contact your Financial Professional to obtain a current prospectus. Please read the prospectus carefully before investing or sending money.

3Guarantees are based on the claims-paying ability of the issuing company and do not apply to the investment performance or safety of the underlying funds.

United States persons (including U.S. citizens and residents) are subject to U.S. taxation on their worldwide income and may be subject to tax and other filing obligations with respect to their U.S. and non-U.S. accounts - including, for example, Form TD F 90-22.1 (Report of Foreign Bank and Financial Accounts ("FBAR")). U.S. persons should consult a tax adviser for more information.

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