What is a Fixed Indexed Annuity?

A Fixed Indexed Annuity is a tax-deferred, stable, financial option designed to grow your premium and protect it if the market drops. This product is typically accompanied with multiple crediting strategies that you can choose to participate in. These crediting strategies include at least one indexed account and may also include a Fixed Rate account. When you select an indexing strategy, you are credited interest at the end of the crediting period in the event the index value grows.

A Fixed Indexed Annuity offers access to more interest growth potential as the market performs positively. In addition to growth potential, a Fixed Indexed Annuity offers protection of principal in several different ways. You do not lose money, including interest earned during previous crediting periods, if the index value drops because your money is allocated to the annuity itself rather than directly to the index (or indices). Additionally, the indexed accounts typically offer a minimum guaranteed interest rate of at least 0%. 


One key reason that people buy an annuity is to have reliable income during retirement. One popular way to get lifetime income with an FIA is through an optional benefit that guarantees income through regular withdrawals that can either start immediately or at a later date. This gives you the option of either taking regular income that’s guaranteed for life or forgoing the guarantee and using the money in other ways. A “withdrawal benefit” can offer different features and comes with conditions in order to keep the guarantee, but that guarantee means that the insurance company will continue payments for life even if the contract runs out of money.

Please contact us for more information and to see if a Fixed Index Annuity is right for you.