What type of annuity is right for you?
Your personal goals, objectives and risk tolerance will determine the type of annuity that is right for you.
Fixed Index Annuities
A form of fixed annuity that earns interest due to changes in a market index, where the growth is bench-marked to a stock market index rather than an interest rate.
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Full protection of principal
FIAs are protected from the volatility of the markets. Your money is never in the stock market. Your crediting strategy tracks the stock market, but you don’t own securities that can fall in value.
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Can potentially provide better rates than CDs
From the 1999 to 2010 many fixed index annuities have actually outperformed the indexes they were correlated with. However, they really aren't designed to outperform the stock markets even though they do at times.
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Efficient way to plan for future income needs
Once you annuitize it with lifetime payout option or turn on the income rider payouts, you cannot outlive that income stream.
Top rates for S&P 500 annual point-to-point accounts with cap
SILAC
7.00%
Symetra
6.00%
Sentinel
6.00%
ACLICO
6.00%
SBLIC
5.75%
Top guaranteed monthly lifetime payouts from an income rider
Ameritas
$1,034
Investors Heritage
$894
ACLICO
$865
Sentinel
$865
NWL
$851
Assuming male, $100,000 premium, issue age 55 and commencing at age 65.
Traditional Fixed Annuities
Fixed annuities are insurance contracts that pay a guaranteed rate of interest on the account owner's contributions.
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Predictable investment returns
The rates on fixed annuities are derived from the yield that the life insurance company generates from its investment portfolio, which is invested primarily in high-quality corporate and government bonds.
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Guaranteed minimum rates
Once the initial guarantee period in the contract expires, the insurer can adjust the rate based on a stated formula or on the yield it is earning on its investment portfolio. As a measure of protection against declining interest rates, fixed annuity contracts typically include a minimum rate guarantee.
Current yield to surrender is shown for corresponding surrender period
PRCUA
3 yrs
2.50%
Protective
4 yrs
1.25%
Symetra
5 yrs
3.15%
Protective
7 yrs
3.50%
Forethought Global Atlantic
9 yrs
3.00%
Sons of Norway
10 yrs
3.05%
Multi-Year Guaranteed Annuities
A multi-year guaranteed annuity, or MYGA, offers a predetermined and contractually guaranteed interest rate for a fixed period of time.
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Less risk
Since a MYGA offers a guaranteed interest rate for the entire contracted term, it’s considered a less risky investment than a variable or indexed annuity.
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Flexibility and liquidity
The ability to take partial withdrawals yearly without a penalty affords flexibility. For example, if you need money to cover a large medical bill you could pull it out of your MYGA, which might be a preferable option to taking money from an IRA or getting a 401(k) loan.
Guaranteed yield to surrender is shown for corresponding surrender period
Canvas Annuity
3 yrs
2.60%
Oceanview
4 yrs
2.75%
ACLICO
5 yrs
3.15%
Canvas Annuity
7 yrs
3.25%
Farmers Life
9 yrs
3.35%
ACLICO
10 yrs
3.25%
