Tax deferral is not exclusive to annuities. Tax-advantaged retirement plans and accounts also offer tax deferral.

IRAs, 403(b) plans, and 401(k) plans provide tax deferral for all the types of investments that can be used to fund the plan or account. Since you already gain the advantage of tax deferral from your retirement plan or account, why would you consider funding it with an annuity?

Tax deferral is only one benefit of an annuity. Unlike other investment vehicles, annuities also offer these important benefits:

• A lifetime income option.
• Retirement income protection.
• Death benefit protection.
• A broad range of investment options with tax-free transfers.
• Professional money management.
• Benefits for risk-averse investors, such as dollar cost averaging and fixed-rate options.

Based on your financial circumstances, there may be features you need or want within your tax-advantaged retirement plan or account in addition to tax deferral. But if you're purchasing an annuity solely for its tax-deferred growth and not for the other benefits, you should speak with a licensed financial professional to see if another investment vehicle would be more appropriate.

Be sure to review the fees and expenses associated with each type of investment.

Since special rules apply to retirement plans and accounts, this guide focuses on nonqualified, tax-deferred annuities only-that is, those that are not a part of a retirement plan or account.