The Pros of Fidelity Annuities

For years, Fidelity and other major investment firms rarely recommended annuities, instead focusing on managed investment accounts that generated ongoing fees. But with higher interest rates making annuities more attractive, Fidelity is now actively suggesting them as part of retirement planning. This marks a major shift, as many long-time Fidelity clients who never heard annuities mentioned before are suddenly being encouraged to consider them.

One key factor in this change is that Fidelity has always had access to annuities, but they primarily used them to keep clients from moving their money elsewhere. If someone planned to transfer funds to buy an annuity, Fidelity might step in with an offer. Now, they’re more proactive, recommending annuities upfront rather than as a last-minute retention tool. While this is a positive development, Fidelity’s selection is limited, and their first offer may not be the best deal available.

A Real-Life Case: Fidelity’s Annuity Quote in Action

A couple in their early 60s approached Fidelity to explore annuity options, looking to set aside money now and start receiving guaranteed income in four to five years. Fidelity provided two annuity quotes—one from Guardian Life requiring $233,000 for a $1,500 monthly payout, and another from Integrity Life requiring $232,000 for the same income. While both are reputable companies, the couple wanted to make sure they were getting the best deal possible.

After shopping the market, they found Midland National offered the same $1,500 monthly payout for only $196,000—a $37,000 savings. That’s a 16% lower cost for the exact same income.

Annuity Provider	Investment Required	Monthly Income
Guardian Life (Fidelity Quote)	$233,000	$1,500/month
Integrity Life (Fidelity Quote)	$232,000	$1,500/month
Midland National (Independent Broker Quote)	$196,000	$1,500/month

This case highlights why shopping around matters. Fidelity only offers annuities from a small selection of providers, meaning their rates might not always be the best. If you’re looking for the best value for your retirement income, comparing multiple options is the smartest move.

Pros of Fidelity Annuities: A Trusted and Respected Institution

Fidelity is one of the most well-known investment firms, and its annuity offerings reflect that reputation. When you purchase an annuity through Fidelity, you’re working with top-rated insurance providers like Guardian Life and Integrity Life, which have strong financial ratings. This ensures reliable payouts and provides retirees with peace of mind knowing their income is backed by a stable, well-established company.

Another key advantage is convenience. Many investors already have accounts with Fidelity, so buying an annuity through them keeps everything in one place. Instead of working with multiple brokers, Fidelity customers can manage investments and annuities together, making financial planning simpler and more organized. Their strong customer service and educational resources also help investors make informed decisions about their annuities.

Pros of Fidelity Annuities	Why It Matters
Strong insurance partners	Backed by highly rated companies like Guardian Life and Integrity Life
Convenience for Fidelity customers	Keeps investments and annuities in one place
Trusted financial institution	Well-established reputation for reliability

However, a strong brand doesn’t always mean the best deal. Fidelity has a limited selection of annuities, so investors may find better rates elsewhere. If convenience is your top priority, Fidelity could be a solid choice—but if you want the best return on your money, shopping around is still the smartest move. Watch the podcast episode to see how Fidelity stacks up against other options.

Pros of Fidelity Annuities: Strong Immediate Income Options

Fidelity annuities tend to be more competitive for immediate income, meaning payouts begin within 12 months. Since Fidelity partners with top-rated insurance companies like Guardian and Integrity Life, their immediate annuities provide reliable income with strong financial backing. For retirees needing guaranteed cash flow right away, Fidelity’s offerings can be a safe and convenient option—especially if you already have assets with them.

However, when it comes to deferred income annuities—where payouts start in several years—Fidelity is less competitive. Since deferred annuities are more affected by interest rate fluctuations, independent brokers can often find better deals by shopping multiple insurers. This means Fidelity’s options may require a higher upfront investment for the same future income.

Category	Fidelity Immediate Income Annuities	Fidelity Deferred Income Annuities
Competitiveness	Strong	Less competitive
Insurance Providers	Top-rated partners	Top-rated partners
Flexibility	Simple, good for quick income	Limited options compared to independent brokers
Pricing	Often fair market value	Usually higher cost than competitors

If immediate income and simplicity are your top concerns, Fidelity could be a solid choice. But if you’re planning for future income, shopping around could save you thousands. Watch the full podcast episode to see how to compare annuity options.

Case Study: How Fidelity’s Annuity Compared to the Market

A couple in their early 60s recently approached Fidelity to explore annuity options. Their goal was simple: set aside some money now and start receiving guaranteed income in four to five years. They weren’t looking for anything complicated—just a solid, reliable way to supplement their Social Security.

Fidelity provided two annuity quotes:

Guardian Life – Required a $233,000 investment to generate $1,500 per month.
Integrity Life – Required a $232,000 investment for the same $1,500 per month.

Shopping the Market: A $37,000 Savings

Rather than taking Fidelity’s quote at face value, the couple decided to see what else was out there. They reached out for independent annuity quotes and found that Midland National offered a much better deal.

Annuity Provider	Investment Required	Monthly Income
Guardian Life (Fidelity Quote)	$233,000	$1,500/month
Integrity Life (Fidelity Quote)	$232,000	$1,500/month
Midland National (Independent Broker Quote)	$196,000	$1,500/month

By shopping the market, they saved $37,000 for the exact same level of guaranteed income. That’s a 16% reduction in cost—which could be used for other retirement expenses, investments, or just extra peace of mind.

Why Does Fidelity Cost More?

Fidelity doesn’t directly create annuities; instead, they partner with insurance companies to offer a limited selection of products. While this ensures their annuities come from well-established firms like Guardian and Integrity, it also means:

Fidelity doesn’t have the flexibility to find the best deal.
They can only offer what’s available within their approved partnerships.
Independent brokers can often secure better rates from the same companies.

Now, let’s be clear—Fidelity isn’t doing anything wrong here. They’re offering strong, reputable options, and for some people, that’s enough. If you have a long-term relationship with a Fidelity advisor and prefer the simplicity of keeping everything in one place, you might accept paying a little more for that convenience.

But for most retirees, $37,000 is not a small amount of money. If you’re working with a fixed retirement budget, that savings could make a huge difference in your long-term financial security.

What If the Numbers Were Reversed?

Let’s flip the situation for a moment. What if Fidelity had the best quote, and an independent broker came in with a higher cost for the same income?

In that case, I’d say stick with Fidelity. The key takeaway here is that shopping around gives you confidence that you’re making the best decision, no matter where you buy the annuity.

At the end of the day, retirement is about making smart financial choices. If an extra 20 minutes of research can save you tens of thousands of dollars, isn’t it worth it?

This case study proves one thing: shopping for annuities is just like shopping for anything else—you wouldn’t buy a car or a house without checking other options, so why treat your retirement income any differently?

If you want to make sure you’re getting the best annuity for your needs, watch the full episode now to see how to compare rates the right way.

Why Shopping Around Still Matters

Even though Fidelity is a trusted name, their annuity selection is limited. Unlike independent brokers who can shop the entire market, Fidelity only offers a few approved annuity options.

When Fidelity annuities might make sense:

If you already have a strong relationship with a Fidelity advisor.
If convenience and simplicity are your top priorities.
If Fidelity offers the best quote after comparing options.

When to shop around for a better deal:

If you want the absolute lowest cost for the highest income.
If you need more flexibility and better contract terms.
If you’re considering a deferred annuity rather than an immediate one.

Breaking Down the Numbers: Where Fidelity Stands Out

Fidelity’s annuities are backed by top-rated insurance companies, ensuring financial security and reliable payouts. However, since Fidelity works with a limited selection of insurers, their annuity quotes may not always be the most competitive. That’s why shopping around is key—while Fidelity offers convenience, you might find a better rate elsewhere.

One advantage of Fidelity is that their annuities are easy to access and manage alongside existing Fidelity investments. Their customer service and online resources also help simplify the annuity process. But if you’re looking to maximize income and flexibility, independent brokers often have access to better rates and more options.

Category	Fidelity Annuities	Independent Annuities
Insurance Providers	Top-rated companies	Wide selection of insurers
Pricing	Can be higher than market rates	More competitive pricing
Convenience	Easy for existing Fidelity clients	Requires more research
Customization	Limited options	More flexibility in features

If simplicity and brand trust are your priorities, Fidelity is a solid choice. But if you want the best possible deal, it’s worth comparing other options. Watch the full episode to learn how Fidelity stacks up against independent market rates.

Final Thoughts: Are Fidelity Annuities the Right Choice for You?

Fidelity annuities come with strong financial backing, solid customer support, and the convenience of managing retirement assets in one place. If you already work with Fidelity and value simplicity over cost savings, their annuities might be a good fit. However, their limited selection of providers means that their rates aren’t always the most competitive. Many retirees find that shopping the broader annuity market results in better payouts and lower costs.

The biggest takeaway? Annuities are not one-size-fits-all. Fidelity’s options may work well for some investors, but for others, a broader search could lead to substantial savings. If you’re considering an annuity, take the time to compare multiple offers, evaluate contract terms, and ensure you’re getting the best return for your investment. Even if you decide to go with Fidelity, you’ll have the confidence of knowing you explored all possibilities.

Fidelity Annuities Are Best For…	You Should Shop Around If…
Investors who prefer simplicity	You want the best possible payout
Those who already have Fidelity accounts	You need more flexible annuity options
People who value a well-known brand	You want access to multiple insurance providers

Ultimately, the right annuity decision depends on your personal financial goals. If you want the best income for your investment, it’s worth comparing Fidelity’s offers to what’s available in the broader market.