
Fixed Indexed Annuities: Potential Plus Protection
Fixed indexed annuities can help current retirees and pre-retirees accumulate money for retirement and provide a guaranteed income after you retire. A fixed index annuity may be a good choice if, you want the opportunity to earn indexed interest, but don’t want to risk losing money in the market.
As you near retirement, the possibility of a market downturn may become a greater concern. However, there is a way to achieve upside potential and downside protection. Also, a fixed-indexed annuity allows you to participate in positive market performance (up to a cap) and locks in gains– this means your account value is protected and will remain level, even when the market declines
What is a Fixed Indexed Annuity?
Fixed Indexed Annuities are a tax-deferred, long-term savings option that provides principal protection in a down market and opportunity for growth. It gives you more growth potential than a fixed annuity along with less risk and less potential return than a variable annuity.
Returns are based on the performance of an underlying index, such as the S&P 500® Composite Stock Price Index, a collection of 500 stocks intended to provide an opportunity for diversification and represent a broad segment of the market. While, the benchmark index does follow the market, as an investor, your money is never directly exposed to the stock market.
Accumulate for Retirement
FIAs offer the potential to earn interest based on changes in an external index. You have the choice of several indexes to choose from.
Protect Your Principle
Your contract can earn interest based on an external index, but you’re not actually buying any stocks or shares of an index. This means the money in your FIA (your “principal”) is not at risk due to market losses.
Growth Tax Deferred
You don’t pay taxes on the interest your annuity earns until you take the money out. This helps compound your interest, so the money in your contract can accumulate faster.
Get Flexibility
Some FIAs offer riders (either built in or at an additional cost) to help you address specific needs. They also offer a variety of crediting methods and flexible options for receiving income.
Receive Guaranteed Income
Annuities are designed to provide a reliable income stream of retirement income, either for a set period or for as long as you live.
Leave a Legacy
FIAs pay your loved ones a death benefit if you pass away before you start taking scheduled annuity payments. (And, if properly structured, the death benefit is not subject to probate.)
What’s this about a Lifetime “Paycheck”?
Certain FIAs give you the ability to grow a source of guaranteed income that you can’t outlive and may even continue to your spouse if you’re the first to pass. FIAs offer different options to help you achieve your income goals, whether you plan to retire in a year or two or retirement is still five years or more off.

How Does a Fixed Indexed Annuity Help a Pre-Retiree?
If you’re approaching the last step in your career, and you want to scale back in risk tolerance, a fixed index annuity might be a good way to grow your assets since you get to participate in a portion of the upside potential, but have protections from a stock market downturn.
If you’re looking to convert your retirement savings into a pension income type of solution, there are many annuity products with guaranteed income riders that will tell you today what your annuity income payments would be in 5, 10, 15, or 20 years. This could be a good foundation for your fixed retirement income planning, especially if you want to meet goals for retirement.
Key Takeaway
Fixed index annuities offer guaranteed income riders, a pre-retiree can create a retirement roadmap and solve for how much money needs to be saved going forward, starting today, to achieve their desired retirement income in the future, up to 30 years in advance.
How Does An Indexed Annuity Help a Retiree?
- A fixed index annuity can be used to generate guaranteed annuity income payments that you can’t outlive.
- A few products can help keep up with inflation to maintain your lifestyle.
- Some annuity products can help plan for long term care, nursing homes, assisted living facilities, and home health care costs.
- Others can enhance death benefits for Estate Planning as an alternative to life insurance.
- Some annuities offer Return of Premium or Accumulating Penalty-Free Withdrawals for extra liquidity.
- Finally, some fixed index annuities offer premium bonuses to help offset any losses.
Who Does Not Benefit from an Indexed Annuity?
- A consumer seeking aggressive growth with all the upside.
- An investor seeking short term commitments.
- Someone wanting unlimited liquidity.
Turn Your Retirement Savings Into An Income Stream You Can’t Outlive.
Annuities are the only retirement plan that can provide guaranteed income for life….even if the annuity runs out of money. Less stress. More efficient. Retire comfortably. Take all the guesswork out of your retirement. The best part? It’s all at no cost to you.
Lifetime Income
A guaranteed lifetime withdrawal benefit provides a paycheck for a single lifetime or both spouse’s lifetime.
Inflation
Your payments have the opportunity to increase each year to protect against inflation.


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