Guaranteed Retirement Income through Fixed Index Annuities

fixed index annuity
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About Jack Whittaker

Jack Whittaker has been providing financial services since 1986. He worked for a Fortune 500 company for 21 years before founding Carolina Benefits Group, where he specializes in helping clients pursue financial independence. Jack’s tenure was marked by an impressive 16-year consecutive appointment to the Chairman’s advisory board and 12 consecutive years as the number-one in sales. At Carolina Benefits Group, Jack and his team provide retirement strategies, income planning, legacy and life insurance planning, Medicare supplement insurance, long-term care, and Estate Planning. With 44 years of marriage and two adult children, and four grandchildren, Jack is committed to helping others achieve financial independence and has built a successful agency.

Fixed index annuities (FIAs) are a type of retirement investment product that provides a guaranteed lifetime income stream, in many cases, in exchange for a lump sum investment. They are designed to provide retirees with a secure and guaranteed source of income throughout their retirement.

FIAs are designed to provide a stream of income that can last the retiree’s lifetime. They are usually structured as long-term contracts between the investor and the insurance company. When the contract is purchased, the investor pays a single premium or several premium payments over a specified period. This premium is then invested in a blend of fixed-income and equity-based investments. The investments are designed to provide a return linked to a market index, such as the S&P 500.

Fixed index annuities offer several benefits to retirees. First, they provide a guaranteed source of income that will last the retirees and their spouse lifetime. This means that the investor is protected from any market losses and can be sure their retirement income will be there no matter what. FIAs offer growth potential, as they are linked to a market index. This may allow the investor to earn more than the guaranteed income.

Fixed index annuities also provide a few advantages over other retirement investment products:

  1. They are tax-deferred, meaning the investor will not have to pay taxes on the income until it is withdrawn. This can be beneficial for those in higher tax brackets. Living benefits for Long term care can be added, giving additional dollars to your account if needed.
  2. No fees are generally associated with purchasing an FIA, meaning the investor will not have to worry about paying sales charges or other fees.
  3. Your principal and gains are protected against market losses. 
  4. Living benefits for long-term care can be added, giving additional dollars to your account if needed.
  5. A Death benefit can be added, allowing the accumulation value to be dispersed to beneficiaries Tax-free in many cases.

Although FIAs can provide many benefits, there are some drawbacks to consider: 

  1. The return on investment is sometimes lower than some retirement investments.
  2. The income stream is sometimes (depending on what product you have) limited to the initial premium amount, meaning that the investor may not increase the income they receive after payment is turned on.
  3. The investor is subject to the performance of the underlying index, which means that their return may be lower than expected if the index performs poorly. 

Overall, FIAs are an excellent way for retirees to generate a guaranteed source of income. They provide a secure and reliable stream of income that can last the retiree’s lifetime, as well as the growth potential, depending on the performance of the underlying index. Considering all factors before investing in an FIA is essential to ensure it suits your retirement needs.

Many people have learned about the power of using the Safe Money approach to reduce volatility. Our Safe Money Guide is in its 20th edition and is available for free.  

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About Jack Whittaker

Jack Whittaker has been providing financial services since 1986. He worked for a Fortune 500 company for 21 years before founding Carolina Benefits Group, where he specializes in helping clients pursue financial independence. Jack’s tenure was marked by an impressive 16-year consecutive appointment to the Chairman’s advisory board and 12 consecutive years as the number-one in sales. At Carolina Benefits Group, Jack and his team provide retirement strategies, income planning, legacy and life insurance planning, Medicare supplement insurance, long-term care, and Estate Planning. With 44 years of marriage and two adult children, and four grandchildren, Jack is committed to helping others achieve financial independence and has built a successful agency.

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Annuities are a safe and reliable investment. They can transform your savings into a more predictable income. Speak with one of our qualified financial professionals today to find out how an annuity can offer you guaranteed monthly income for life.

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Content in our posted articles is deemed to be accurate but topics, facts and laws can change. It is always a good idea to verify facts before making decisions. Always seek authorized and professional advice regarding financial decisions which includes investing, annuity purchases, tax planning, changes in a financial portfolio and retirement planning.

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