Variable Annuities
Schwab offers a choice of two low-cost1 variable annuities to help you save for retirement. Both give you the option of income for life2 along with the opportunity for growth with potential market gains.
Talk to us about variable annuities.
Visit your nearest Schwab branch or call an Annuity Consultant at 888-311-4889.
Compare Schwab's variable annuities.
| Schwab Retirement Income Variable Annuity™ | Schwab OneSource Annuity® | |
| Overview | Low-cost, straightforward annuity. Offers guaranteed lifetime income through annuitization or an optional guaranteed lifetime withdrawal benefit. | Flexible, low-cost annuity with a variety of investment portfolios and two death benefit options. |
| Costs | Lower | Low |
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| Investments | Three broadly diversified portfolios to simplify retirement investing. | A wide range of investment options providing investment flexibility. |
| Issuer | Pacific Life | Great-West |
| Costs | Lower | Low |
| Base annuity fee | 0.60% | 0.65% if purchased with return of account value death benefit, or 0.85% with return of premium death benefit |
| Optional GLWB | 0.80% Individual 1.00% Joint |
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| Underlying investment costs | 0.80% (Capped)3 | 1.00% Average cost4 |
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| Annual guaranteed income2 | 5% of protected payment base regardless of age at first withdrawal after age 59½ 5 | |
| The guaranteed lifetime withdrawal benefits referenced above are optional riders for which you will incur an additional charge, as shown above. The protected payment base on which the guaranteed lifetime income is based is not a contract value, cannot be accessed like a cash value, and will not preserve your contract value, which will deplete with each withdrawal until it reaches zero, although payments under the terms of the rider will still continue for life. In the absence of an enhanced death benefit, there will be no funds available for your beneficiaries if withdrawals taken prior to your death exceed the actual contract value. Restrictions and limitations apply. See the prospectus for details. | ||
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| Return of account value | Beneficiaries receive any remaining account value. | Beneficiaries receive current account value. Available for those age 85 or under at time of purchase. |
| Return of premium | Beneficiaries receive contributions (less proportional withdrawals) or the return of account value, whichever is greater. Available for those age 80 or under at time of purchase. | |
| Investments | Three broadly diversified portfolios to simplify retirement investing. | A wide range of investment options providing investment flexibility. |
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| Issuer | Pacific Life | Great-West |
| Financial strength rating | A+ (Superior) by A.M. Best 6,7 | A+ (Superior) by A.M. Best 7,8 |
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Call a Schwab Annuity Specialist at 888-311-4889.
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1. 1.34% is the average base annuity fee according to a December 31, 2012 Morningstar survey of 1,925 variable annuities. This does not include fees associated with optional riders or the underlying investment options.
2. The guarantee is provided by the issuing insurance companies (not Schwab) and depends on the claims-paying ability and financial strength of the issuing insurance companies. Withdrawals of earnings are subject to ordinary income tax and, if taken prior to age 59½, may be subject to a 10% federal tax penalty. Any excess withdrawals will significantly and permanently reduce all future withdrawal amounts.
3. The investment adviser and its affiliates have agreed to limit the total annual portfolio operating expenses (excluding interest, taxes, and certain non-routine expenses) of each portfolio for so long as the investment adviser serves as adviser to the portfolio. Please see the Schwab Variable Insurance Trust (VIT) Portfolios prospectus for details on fees and expenses.
4. As of March 31, 2012, the fees for the investment options available in the Schwab OneSource Annuity range from 0.28% to 1.72% annually. This range of fees does not reflect any waivers that apply to some underlying investment options, so actual expenses could be lower.
5. Withdrawals made before age 59½ may be subject to a 10% federal tax penalty. Withdrawals in excess of the specified annual payout amount may permanently reduce the income base under the GLWB.
6. Rated A+ (Superior, second highest of 16 categories) by A.M. Best as of July 9, 2012.
7. Ratings do not apply to the performance of variable annuity subaccounts or any product or service not fully backed by the insurance company’s claims-paying ability. Ratings are subject to change. There is no guarantee that current ratings will be maintained.
8. Rated A+ (Superior, second highest of 16 categories) by A.M. Best as of March 27, 2012.
Brokerage and insurance products: Are not deposits • Are not FDIC-insured • Are not insured by any federal government agency • Are not guaranteed by the bank or any affiliate of the bank • May lose value
Variable annuities are sold by prospectus only. Before purchasing an annuity, you should carefully read the prospectus and consider its investment objectives and all the risks, charges, and expenses associated with the annuity and its investment options. You can request a prospectus containing this and other information at 888-311-4889, or you may view one online.
The contract value of the annuity may be more or less than the premiums paid and it is possible to lose money.
Variable annuities are long-term investment vehicles designed for retirement purposes. Withdrawals of taxable amounts will be subject to ordinary income tax and, if taken prior to age 59½, may be subject to a 10% tax penalty. Withdrawals will reduce the death benefit amount in direct proportion to the percentage by which the contract value was reduced. This can increase or decrease the amount deducted from the death benefit.
Variable annuities are subject to a number of fees, including mortality and risk expense charges, administrative fees, premium taxes, investment management fees, and charges for additional optional features. Although there are no surrender charges on the variable annuities offered by Schwab, such charges do apply in the early years of many contracts.
Charles Schwab & Co., Inc., a licensed insurance agency, distributes certain insurance and variable annuity contracts that are issued by insurance companies not affiliated with Schwab. Not all annuity contracts are available in every state.
The Schwab Retirement Income Variable Annuity is issued by Pacific Life Insurance Company in all states except New York and in New York by Pacific Life & Annuity Company. The contracts are sold exclusively by Charles Schwab & Co., Inc. (“Schwab”) through its representatives, including both employees and independent contractors and their employees (“Schwab Financial Consultants”). Charles Schwab Investment Management, Inc. (CSIM) is the adviser for the underlying investment options. Charles Schwab & Co., Inc. and Charles Schwab Investment Management, Inc. are separate but affiliated companies and subsidiaries of The Charles Schwab Corporation and are not affiliated with Pacific Life Insurance Company, Pacific Life, and Pacific Life & Annuity Company.
GWFS Equities, Inc. is the principal underwriter for the Schwab OneSource Annuity (Form J444 Series), a flexible premium variable annuity contract issued by Great-West Life & Annuity Insurance Company; corporate Headquarters: Greenwood Village, Colorado. This variable annuity contract is not available in all states. GWFS Equities, Inc. is a wholly owned subsidiary of Great-West Life & Annuity Insurance Company. In the state of New York, the Schwab OneSource Annuity (Form J444NY Series) is issued by Great-West Life & Annuity Insurance Company of New York; home office: White Plains, New York. GWFS Equities, Inc. is an affiliate of Great-West Life & Annuity Insurance Company of New York. This variable annuity contract (Form J444NY Series) is only available in New York. Charles Schwab & Co., Inc. is the selling broker-dealer and insurance agency and is unaffiliated with Great-West Life & Annuity Insurance Company and Great-West Life & Annuity Insurance Company of New York.