The Validity of Fixed Index Annuities


Since I always direct people to search for facts that support financial products and strategies, I recommend all members of Annuity Straight Talk take a look at this report published by the Wharton Financial Institutions center regarding fixed index annuities.

Fixed Index annuities have a place at the table in retirement income planning.  In the report found here, the authors offer evidence that shows fixed index annuities produce favorable returns in comparison to all other asset classes over the past decade or more.

These products are relatively new to the retirement market so it is useful to have some objective information to help decide whether it’s the right fit for you.

The real advantage to fixed index annuities is the fact that the account values don’t decline when the market drops.  And although positive returns are subject to maximum cap rates, the lower volatility makes the overall gains very competitive.

In addition, because of the more stable asset base, future income guarantees far outpace comparable variable annuities.

When you read this report, start with the abstract points listed at the beginning to get the basic conclusions of the report.  If you’ve ever questioned the validity of fixed index annuities, I suggest skimming the report for verification of the quality of this product type.

For a discussion about how fixed index annuities can help stabilize your retirement assets please learn more about this in the The Annuity Report by signing up below or to the right.  Or, explore these  pages on Fixed Index Annuities or these pages on their popular income- rider siblings, Hybrid Annuities.

Bryan J. Anderson

800.438.5121 [email protected]

Refer here for more on fixed index annuities

How Has The Stock Market Treated You?


I recently came across this article in the September edition of The Atlantic titled The Great Stock Myth that should give everyone something to think about.

We are all taught to believe the the stock market should offer a premium return in exchange for the associated level of risk. That has mostly been true for much of the past century. Recent history, however, shows that the premium steadily decreased as more and more people poured money into the equity markets.

This article mentions a couple of studies, one completed in 1999 that show investors expected annual returns of 30%. Another notes that even after the 2008 crash, one in four investors expects annual returns of 10-20%.

Where do such high expectation originate? Actual performance results over the past decade have been slim to negative in most cases. Forecasts for the next ten years don’t offer much hope, either.

What are your expectations for retirement asset growth? Can you afford to shoulder the risk of the markets without any reward?

It seems a wise move to not rely solely on equities for placement of sacred retirement assets when volatility is least wanted.

One of the fundamental purposes of Annuity Straight Talk is to offer honest information to people who are tired of getting battered and bruised in the stock market. You can safely and predictably grow your assets while assuming little to no risk. It is likely an annuity of one form or another is exactly what you need.

Curious? Just ask me how. Sign up now to receive the free reports on this site or feel free to call or email any time. I can be reached at 800.438.5121 or [email protected]

To read The Atlantic Monthly aricle click here.

Retirement Income Options


If your retirement income strategy is optimized, then you have a strategy for asset distribution during retirement.  If not, then major financial institutions are busy finding ways to bring you in, and offering products and services to clients who are moving away from accumulation strategies.

This week, features an article that talks about how mutual fund companies are developing product offerings designed to meet long-term retirement income goals.  In short, they are trying to compete with annuities and the insurance industry.

As more and more baby boomers approach retirement, focus has been shifted from asset growth to distribution.  The safest and most profitable solutions have been around for a long time.  While distribution-oriented mutual funds will give retirees more options, they have yet to match the guarantees found in annuity contracts.

Options are important in any retirement plan.  Just remember that no plan is safe without contractual guarantees from a solid financial institution.  If volatility is something you’d like to leave behind then any mutual fund option may not give you the desired level of safety that annuities can.

In the same sense, all good plans are balanced.  Annuities can provide a good baseline to meet expenses and securities account will enable continued growth.

Explore AnnuityStraightTalk for information on the stable portion of your portfolio.  For a free membership simply sign up today for a complete guide to a safe, flexible and profitable retirement.

To learn more about the retirement income funds featured on click here.

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The Fixed index annuity or also referred to as equity indexed annuity is a hybrid annuity that allows for the possibility for upside appreciation in the stock market, but protects against risk of loss to principal due to unexpected market changes. An equity indexed annuity also guarantees a minimum interest rate regardless of future performance.  Each insurance company uses a different formula to calculate the rate guarantees they offer to investors.

Are they a good deal?  Our post on Equity Indexed Annuities opens up more on the topic and injects a bit more opinion than this informational page- please check it out.

The equity indexed annuity is a hybrid that attempts to balance the safety of a fixed income product with the potential for gains of a variable product.  These annuities link account performance to a stock market index.  Every company measures different indexes differently, and calculates returns differently.

While historically it’s true that the stock market offers the potential for higher returns, that upside always comes with potential risk. For conservative investments, fixed interest products prioritize safety and protection of principal, but that comes at the price of lower returns.  But over the long term, these returns often balance out, especially when volatility can wipe out years of gains. Hello 2008?  Be sure to understand how by reading Which 10% do you want…

Investors constantly wrestle these forces of security and yield in every individual investment and in each portfolio allocation decision.

The equity indexed annuity (fixed indexed annuity) attempts to satisfy all forces, and provide a middle ground where performance meets safety and investors can experience the best of both worlds.  You might guess what happens when one product tries to be all things to all people.

The equity indexed annuity can track a preferred stock market index, such as the S&P 500, NASDAQ, or Dow, with the rate of return usually being a set percentage of the increase the index shows over a set period, or a guaranteed minimum interest rate (whichever is higher).

Equity indexed annuities are a very attractive annuity for many investors because the principal investment is protected and guaranteed from loss, while the potential for gains engenders hope.  But be wary of the details!

Each Equity indexed annuity offers different components and characteristics.  Insurance companies vary:

The minimum amount you are guaranteed to earn,
The maximum amount you can earn,
The total percentage of upward movement in an Index that you can participate in,
The use of your accumulated funds once the annuity term is over.

For any equity indexed annuity, it is important to clearly understand how the annuity works, to ensure your selection is best suited to meet your future retirement needs.  Be sure to read through our Report for the Straight Talk on picking any annuity product.


Annuity Suitability


Is an Annuity right for you?

First, does any of this describe your current situation and retirement income plans?


You’ve successfully saved for retirement and grown you savings over the years.  But now you need to switch from offense to defense. Are you unsure how to switch from an accumulation and growth mode, to an income and preservation mode?

Capital Preservation:

The stock market and real estate investments have taken dramatic nosedives. Are you concerned about protecting your savings while still earning a reasonable return?


The nosedive of the last year has left you shaken. Are you concerned about losing your retirement savings in a market downturn?

These brief points can help answer the question “Is an Annuity Right for Me?”  If you feel an Annuity makes sense, allow yourself time to make Informed Decision. Please utilize all our resources to help make this important decision.

Step #1 is to sign up for our Free Annuity Report . This free report is available to help you understand these popular products, and outlines in detail the decision process and critical factors necessary in buying an Annuity. Simply fill in your name and email and we’ll send it to you right away.

Step #2 is an Appointment.  These simple questions help us see if an Annuity is right for you, and help us to design an Annuity solution for your needs. We give you the tools to make an informed decision, and we can recommend annuities that meet your specific needs.

You will find our recommended products and companies come with the best combination of Safety, Flexibility, and Profitability for your situation. Annuity Straight Talk is a resource for you.  Don’t hesitate to ask for help .