Fixed Index Annuities

Fixed Index Annuities (FIAs) are a type of deferred annuity that provides principal protection, tax-deferred growth, and interest linked to a market index (like the S&P 500) without direct market exposure. They are commonly used for retirement income planning because they offer growth potential with less risk than direct stock market investments.

• Your money is not invested in the market but earns interest based on an index's performance.
• No losses from market downturns—your principal is protected.

Key Features of Fixed Index Annuities (FIAs):

1. Principal Protection – Your initial investment is not at risk due to market losses.
2. Growth Potential – Interest is credited based on an index’s performance, but there’s typically a cap or participation rate.
3. Tax-Deferred Growth – Earnings grow tax-deferred until withdrawals begin.
4. Lifetime Income Options – You can convert it into guaranteed income, often with riders for longevity protection.
5. Downside Protection – If the market index performs negatively, your annuity won’t lose value (except for fees).
6. Index Crediting Methods – Common methods include point-to-point, annual reset, and monthly averaging.
7. Surrender Periods & Fees – Typically, there’s a surrender charge if funds are withdrawn early.
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✔ Growth Potential – Earn interest based on index performance.
✔ Principal Protection – Your money is safe from market downturns.
✔ Tax-Deferred Growth – Pay taxes only when withdrawing funds.
✔ Guaranteed Lifetime Income – Many offer income riders for lifetime payments.
✔ Death Benefits – Pass remaining funds to beneficiaries.

• Pre-retirees and retirees looking for market-linked growth but with zero downside risk.
• Individuals wanting guaranteed income for retirement.
• Investors who prefer tax deferral and principal security over high-risk investments.