Learn how you may be able to guarantee income for life with Fixed Indexed Annuities low cost riders. Imagine creating your own personal pension and never outliving it. There is much to discuss as everyone's retirement income needs are unique so please request a free consultation with a Liles Agency, Inc. Financial Representative.
Fixed Indexed Annuities, (also known as FIA’s, Equity Indexed Annuities, or EIA’s), offer market index linked return with minimal risk of principal and guarantee a minimum interest rate for the life of the contract.*
*All guarantees are based on the financial strength and claims paying ability of the issuing insurance company, who is solely responsible for all obligations under its policies.
Equity Index Annuities: Market Index Strategies
An equity index annuity is an annuity that earns interest that is linked to one or more market indexes.One of the most commonly used market indexes is the Standard & Poor’s 500 Composite Stock Price Index (the S&P 500)
How are EIA’s Different From Other Fixed Annuities?
Equity index annuities are different from fixed annuities because of the way it credits interest to your annuity’s value.* Most fixed annuities credit interest calculated at a rate set in the contract.Equity index annuities credit interest using a formula based on changes in the index to which the annuity is linked.The formula decides how the additional interest, if any, is calculated and credited.How much additional interest you get and when you get it depends on the features of your particular annuity.
*Indices are subject to market risk, are not guaranteed and will fluctuate in value.
Your equity-indexed annuity, like other fixed annuities, also promises to pay a minimum interest rate. The rate that will be applied will not be less than this minimum guaranteed rate even if the index-linked interest rate is lower. The value of your annuity also will not drop below a guaranteed minimum. For example, many single premium annuity contracts guarantee the minimum value will never be less than 90 percent (100 percent in some contracts) of the premium paid, plus at least 3% in annual interest (less any partial withdrawals). The insurance company will adjust the value of the annuity at the end of each term to reflect any index increases.
*Additional features/benefits/riders may be available for an additional cost.
How Do I Know Which Equity Index Annuity Is Best For Me?
As with any other insurance product, you must carefully consider your own personal situation and how you feel about the choices available. No single annuity design may have all the features you want. It is important to understand the features and trade-offs available so you can choose the annuity that is right for you. Keep in mind that it may be misleading to compare one annuity to another unless you compare all the features of each annuity. You must decide for yourself what combination of features makes the most sense for you. Also, remember that it is not possible to predict the future market behavior of an index.
To speak with a Liles Agency Financial Representative regarding Equity-Indexed Annuities or other annuity products, please call at 800-368-5154 or 303-770-3000.
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