Fixed indexed annuities earn interest based on changes in a market index and are guaranteed to never be less than zero. Participation rates, cap rates, and spread rates all describe ways the amount of interest added to your annuity may not reflect the full change in the index.
Fixed annuities guarantee your money will earn at least a minimum interest rate. Your value in an annuity contract is the premiums you’ve paid, less any applicable charges, plus interest credited. The insurance company uses the value to figure the amount of most of the benefits that you can choose to receive from an annuity contract.
A deferred annuity has two parts or periods. During the accumulation period, the money you put into the annuity, less any applicable charges, earns interest. The earnings grow tax-deferred as long as you leave them in the annuity. You may want to consult independent advisors. Make sure you’re satisfied with the answers before you buy.
Receive your free NAIC Buyer’s Guide to Fixed Deferred Annuities at
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youtube.com/@AnnuitiesExplained. Contact Jeffrey Scott McLeod, LUTC for personalized guidance tailored to your state.
Educational content provided by Jeffrey Scott McLeod, LUTC, National Insurance Producer License #558629. This is for informational purposes only and is not a recommendation to buy or sell any annuity. Guarantees are subject to the claims-paying ability of the issuing insurance company. Always consult your own advisor and read the full NAIC Buyer’s Guide. For residents of your state.
Jeffrey Scott McLeod, LUTC — National Producer #558629.
Questions? Contact Jeff@AnnuitiesExplained.org.
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