As a small business owner, you understand how important it is to plan for your own financial future. You also want to attract and retain skilled employees by offering a retirement savings account. Business annuities can help a business owner establish individual retirement accounts and fund these arrangements with deferred annuities.

What is an annuity?
An annuity is a contract between an insurance company and an annuity owner. In exchange for a purchase payment, or series of payments, the insurance company guarantees to pay a stream of income in the future1.

How is an annuity used?
Funding an individual retirement arrangement requires a long-term investment. A deferred annuity can be broken down into two phases: an accumulation phase and an income phase. During the accumulation phase, the accumulation value of the annuity may grow. Once the contract is annuitized, it begins to pay a guaranteed stream of income for life or a certain period of time.

What are the benefits of an annuity?
The benefits of deferred annuities include payment of a guaranteed stream of lifetime income, potential to accumulate savings on a tax-deferred basis and beneficiary provisions.

What are the different types of arrangements that can be funded by annuities to help meet the needs of your business?


A written salary reduction arrangement that allows eligible employees to contribute to an Individual Retirement Account (IRA) in their name. Employers are required to make annual contributions for each eligible participant.


A written agreement that allows an employer to make contributions to IRAs for all eligible employees.

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1Guarantees are based on the claims-paying ability of the issuing company.

Annuities are not appropriate for everyone. There are fees and charges associated with owning an annuity. Annuities do not provide any additional tax advantage when use to fund a qualified plan such as an IRA. Investors should consider buying an annuity to fund a qualified plan for the annuity’s additional features, such as a stream of lifetime income payments and death benefit protection.

The information provided is not written or intended as specific tax or legal advice and may not be relied on for purposes of avoiding any Federal tax penalties. MassMutual, its employees and representatives are not authorized to give tax or legal advice. Individuals are encouraged to seek advice from their own tax or legal counsel.

Insurance products issued by Massachusetts Mutual Life Insurance Company (MassMutual), 1295 State Street, Springfield, MA 01111-0001 and its subsidiaries C.M. Life Insurance Company and MML Bay State Life Insurance Company, 100 Bright Meadow Boulevard, Enfield, CT 06082.

Principal Underwriters: MML Strategic Distributors, LLC. and MML Investors Services, Members FINRA and SIPC ( and MML Strategic Distributors, LLC. and MML Investors Services are subsidiaries of Massachusetts Mutual Life Insurance Company, 1295 State Street, Springfield, MA 01111-0001.