What are surrender charges on Annuities?
Surrender charges are typically a percentage of the total value of the annuity. To calculate the charge, you multiply the total value of the annuity by the surrender charge percentage. For example, if you have an annuity with a current value of $10,000 and a surrender charge of 5%, the surrender charge would be $500.
What is a partial surrender of an annuity?
A partial surrender refers to the withdrawal of only a portion of your contract value and allows you to retain the benefits of the annuity’s tax-deferred growth while accessing some cash immediately. A partial surrender will also limit the amount you’ll pay in surrender charges. Interested in selling some or all of your payments?
What does it mean to cash out an annuity?
Cashing Out: Understanding Surrender Charges. Surrender charges are the fees associated with selling all or a part of an annuity back to the company you purchased it from. A full surrender indicates that you are cancelling your annuity policy.