Investment Education Tax Deferred Tax deferred income is any income that one earns but does not receive until a later date, resulting in a situation in which taxes on the income are not paid until later. Common examples of tax-deferred income fall into two broad categories. The first category includes qualified retirement plans and IRA's; the second involves using insurance such as various types of life insurance or annuities. The common characteristics of these two categories are that no taxes are paid on any capital gains or income until the invested funds are withdrawn and paid out. At that point in time, the distribution is taxed as ordinary income. There are advantages and disadvantages for these types of investment vehicles. Please call for additional information. Fixed Annuities A fixed annuity is an investment contract sold by a life insurance company that guarantees regular payments to the purchaser for a specified period of time, or for life. The purchaser generally pays a premium either in a lump sum or in installments. Fixed annuities are long-term investment vehicles designed for retirement purposes. Gains from tax-deferred investments are taxable as ordinary income upon withdrawal. Guarantees are based on the claims paying ability of the issuing company. Withdrawals made prior to age 59 are subject to a 10% IRS penalty tax and surrender charges may apply. Investment Education Fixed Income Tax Deferred Alternative Investments Taxable Fixed Income Derivative Equities Tax Free Income Insurance .