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What’s an annuity?

Annuities can be a vehicle used to save for one’s retirement, just as some use certificates of deposit (CDs), 401(k)s, bonds, mutual funds, and stocks. At a given point in every annuity, you can change it from a retirement savings vehicle to a retirement income stream, through a process called annuitization.

A top concern of Americans continues to be guaranteeing a minimum level of income during their retirement years. Coincidentally, annuities are one of the only financial instruments that can guarantee the purchaser an income for the rest of their life, depending on the payment structure chosen.

Annuities are also known for their tax deferral qualities. Purchasers can use money that has not yet been taxed, known as qualified funds, to purchase an annuity. Thereafter, taxes are not paid until a withdrawal or distribution is made. Plus, the annuitant will earn interest on the full amount of the funds in the annuity, both interest and principal, throughout the life of the annuity. #1

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Retirement income growth
you can count on

If you’re looking to protect and grow your retirement income, now is a great time to take advantage of higher interest rates. Multi-Year Guarantee Annuity (MYGA) (Form Series 21211512)#2 grows at a guaranteed fixed rate of interest for a specified period of time.

See annuity products and interest rates.

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Access to your money

MYGA can help you navigate volatile economic conditions with ease thanks to the Member Emergency Access Waiver of Surrender Charge Rider#3. With this rider, you’re eligible for a one-time withdrawal for no additional premium, and no surrender charges.

Is an Annuity Right for You?

Learn more. 

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See annuity products and interest rates.

Annuity Quick Reference Guide

#1Not available in AK, AL, HI, LA, MA, NH, NY.

#2A fixed annuity is a long-term, tax-deferred product designed for retirement savings, and has limitations, including Surrender Charges and Market Value Adjustments. Guarantees are based on the strength and claims-paying ability of Royal Neighbors. Not FDIC insured – may lose value. Guaranteed for the first three, five, or ten Certificate years, after which a new renewal rate will apply to a second guaranteed period of the same number of years.

#3After the first Certificate Year, and upon the occurrence of a Qualifying Emergency Event, the Owner is eligible for a one-time withdrawal of up to 50% of the account value which is the account value as of the beginning of the Certificate Year in which the withdrawal is made, not to exceed $250,000.

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a contract between an insurance policy holder and an insurer or assurer, where the insurer promises to pay a designated beneficiary a sum of money (the benefit) in exchange for a premium, upon the death of an insured person (often the policy holder).

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coverage options


The calculations contained within this calculator are specific to Royal Neighbors of America. It is intended to estimate an amount of life insurance coverage if death occurred in the near future. It is not a recommendation for specific coverage amounts. Your financial needs may differ from the estimates. Royal Neighbors does not guarantee that the amount illustrated here will meet your financial needs. You are responsible for selecting the appropriate amount of coverage. To evaluate your specific needs, please contact Royal Neighbors directly at (866) 845-6665.

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Additional Life Insurance Needed
  • Your total needs minus your total resources means you need N/A

Income Replacement Estimate

This chart estimates how much life insurance your loved ones may need to replace your income and maintain their current standard of living. Your dependents may be eligible to collect Social Security income benefits, which are included in the calculation below. The “Insurance Needed” column does not include financial needs such as paying off debt or paying for college.
Year Partner Age Partner Income S.S. Income Available Income Desired Income Surplus/Shortfall Available Resources Insurance Needed

Calculations include your answers to the previous questions, in addition to the following: 3% investment return; 2.6% anticipated inflation rate; $8,500 for funeral expenses which is based on the national median cost for an adult funeral in 2014 according to the National Funeral Directors Association1; 75% of your annual combined income for desired annual income needs; and 15 years for the number of years’ income needed or the calculation of the number of years it will take your youngest child to complete higher education, whichever is greater. Social Security benefits were factored based on the age of your youngest children (up to 4). Immediate needs include your mortgage, other debts, and $8,500 for funeral expenses.

College cost estimates are based on the following parameters (based on data provided by [College Board] . The inflation rate for college costs (5.48% annually) is based on the Bureau of Labor and Statistics Consumer Pricing Index average from January 1996-June 2016. This rate will factor into college cost assumptions for future years, adjusted annually.

  • Amount for community college: 2 years @ $3,435/year (tuition and fees only)
  • Amount for public university: 4 years @ $19,548/year (tuition, fees, room and board)
  • Amount for private university: 4 years @ $43,921/year (tuition, fees, room and board)

1 “The national median cost of a funeral with viewing and burial for calendar year 2014 was $7,181. If a vault is included, something that is typically required by a cemetery, the median cost is $8,508. The cost does not take into account cemetery, monument or marker costs or miscellaneous cash-advance charges, such as for flowers or an obituary.”

The specified form no longer exists or is currently unpublished.
Form #: P00016; Rev. 10-2023