Vanguard Annuity Access

Introduction
The Vanguard Fixed Annuity–Single 5 is tax-deferred fixed annuity offered through the Lincoln Life & Annuity Company of New York. According to Vanguard, the annuity is suitable:

"For those seeking retirement income or a way to save for retirement that provides principal protection, the Vanguard Fixed Annuity—Single 5 offers a tax-deferred interest rate that's guaranteed for five years. Individuals have the flexibility to withdraw up to 10% of their policy's accumulation value per year without a surrender fee. After five years, they can renew their policy, at a new rate, tax-deferred."

As of 08/15/2008, the annual effective interest rate for the Vanguard Single 5 is 4.30%. This rate is subject to change without notice. You are allowed to make purchases of the contract until age 85. Fixed annuities are not considered securities, and thus, do not have a prospectus.

Guaranteed Interest Rate
The Vanguard Fixed Annuity–Single 5 offers a tax-deferred guaranteed interest rate that is effective for five years and is not subject to the volatility of the financial markets. This rate is subject to change; the interest rate in effect at the time your policy is processed is the guaranteed rate you'll receive for five years. At the end of the 5-year period, you can lock in the new prevailing rate for another 5 years or for a year at a time. You continue to defer taxes when you renew your policy.

Insurer Solvency
The capital investment and interest accruals in the Vanguard Single 5 fixed annuity are invested in the general account of the Lincoln Life & Annuity Company of New York and are subject to the claims paying solvency of the insurer. The insurer is currently rated AA by S&P (3rd-highest of 21); rated AA by Fitch (3rd-highest of 24); rated A+ by A.M. Best (2nd-highest of 16), and As3 by Moodys (4th-highest of 21).

Surrender Charges
You can withdraw up to 10% of the value of your annuity each policy year without any surrender charges. Withdrawals surpassing this 10% allowance are subject to the following surrender charges:

Withdrawals before age 59½ are subject to the 10% federal early withdrawal penalty tax.

Annuitization
The contract can be annuitized as a fixed immediate annuity.

Beneficiaries
If you die during the guaranteed period and you haven’t converted your annuity to an income stream, your beneficiary is entitled to a death benefit equal to the annuity’s accumulation value. No surrender charges apply to the death benefit.