Annuities
Understand the benefits
Retirement Annuities
Understanding Fixed Indexed Annuity Benefits
As you plan for retirement, you may be looking for ways to grow and protect your income. Some people consider retirement annuities as part of their retirement strategy. An annuity is a type of insurance that offers guaranteed income. There are many types of annuities. Which one is right for you?
Benefits of a Fixed Index Annuity (FIA)
Fixed index annuities are used as a long-term strategy to provide guaranteed retirement income. They help protect your principal and provide a guaranteed retirement income. Here is a breakdown of the advantages of fixed index annuities.
Fixed indexed annuities grow earnings tax-deferred. With these retirement annuities, interest is not taxable until you withdraw it. Tax-deferral enables compound interest growth.
Retirement annuities are designed to provide a steady stream of income throughout retirement.
The interest you earn on your annuity contract is based on an external index. But you are not actually buying any stocks or shares of the index. Thus, the money in your FIA isn’t at risk of market losses.
An FIA may earn interest based on an external index’s performance, such as the S&P 500, without being tied directly to the stock market.
Your beneficiaries receive the death benefit after you pass. Additionally, the death benefit can also avoid probate if it is structured properly.
FIA Interest Rates
A few factors determine an FIA’s index rate. Annuity interest rates are typically determined by insurance companies. The insurer ensures your earnings. Our company works with highly reputable and reliable providers. It is generally wise to try to get a reasonable return** on your money. These policies usually guarantee* retirement income. You will not lose money despite the fact that it is a low-risk purchase.
You can earn a reasonable return on your money while maintaining your assets.
Fixed Index Annuities and the Stock Market
An FIA is an insurance product, not an investment vehicle. Instead, insurers use an index. These products earn interest even though they are not directly tied to the stock market. Also, insurance companies guarantee a minimum interest rate. The insurance company assumes the risk if the stock market falls, not you. FIAs maintain the same interest rate regardless of stock market fluctuations. A decline in the stock market does not affect your FIA.
Learn More About FIA’s
If you are considering retirement annuities, make sure it meets all your needs. Our team at GPS Retirement can help you explore all your options in detail. Call us for a meeting or register for one of our retirement seminars at no cost to you.
