If you want to choose from a broad range of investment options and are willing to accept greater market risk in exchange for a potentially greater rate of return, a Variable Annuity may be right for you. It is a flexible, tax-deferred investment vehicle that allows you to actively manage your investments and adapts to suit your changing needs over time. The value of a Variable Annuity is determined by the performance of the investment options selected. Performance is not guaranteed.
Multiple investment options
With a Modern Woodmen Variable Annuity, you tailor your portfolio to your investment goals by selecting from a variety of stock and bond investment options. These options allow you to diversify between numerous asset classes and implement a variety of investment strategies.
Potential earnings grow tax-deferred until you make a withdrawal. The power of compounded tax-deferred growth allows your retirement savings to accumulate more rapidly than they would in a fully taxable account.
After satisfying the initial minimum requirements, you control the amount and frequency of the premium payments made to a Variable Annuity.
Variable Annuities are used to fund a variety of Modern Woodmen plans. The minimum initial contribution amounts for a Modern Woodmen Variable Annuity varies per plan. For example, you can open:
- Non-Qualified Plans with $1,000
- Traditional IRAs, Roth IRAs, SEP-IRAs with $1,000 or $100 a month through an automatic monthly draft of a checking or savings account
- SIMPLE IRAs and 403(b) TSAs with $50.00 a month through salary reduction contributions
You can move your retirement funds among the Variable Annuity investment options without taxation, and you can make 12 transfers each year without incurring a charge.
Over time, your intended allocation percentages among your selected investment options may change due to their performance, potentially exposing you to additional risks. Each year, Modern Woodmen’s automatic rebalancing feature can reallocate the funds in your contract to the allocation percentages used for new premiums, maintaining your asset allocation strategy.
The Variable Annuity gives you convenient access to funds when you need them. Each contract year, you may withdraw up to 10 percent of the accumulated value without a surrender charge. You may also withdraw funds penalty-free under specific circumstances, including death, terminal illness, a stay in a qualified nursing care center or an IRS-required minimum distribution.
Flexible distribution options are available at retirement, including an option that will provide guaranteed income for life.
You can choose between a variety of fixed and variable income payment options. The dollar amount of your income payment will depend on the balance in your contract and the settlement option you select. If you die before you receive all of your guaranteed payments, the remaining guaranteed amount is paid to your beneficiaries according to the terms of the settlement option.
The Variable Annuity guarantees that if you die before the annuity payout begins and you were younger than age 76 when the contract was issued, your loved ones are guaranteed to receive the greater of the sum of all premiums paid, minus any partial withdrawal reductions or the accumulated value.
On certain certificates, the Incremental Death Benefit rider is also available. This rider provides an additional death benefit of up to 40 percent of any gain in the certificate. The benefit amount is intended to help your beneficiaries pay the income tax on any growth in the annuity, and therefore, help preserve a greater portion of the annuity value or the Performance Enhanced Death Benefit (PEDB) amount.
The PEDB amount is the highest accumulated value (plus subsequent premiums paid and less subsequent withdraw reductions) achieved over the course of the contract prior to age 91. The recalculation for the highest accumulated value occurs on each contract anniversary, premium payment, and/or withdrawal, and at death. For issue ages 76 or older, the PEDB amount is not included.
Transfer existing annuities to Modern Woodmen
An existing annuity may be transferred to Modern Woodmen of America without triggering additional income taxes.