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Safe Money Options

Two large financial market downturns since 2000 have caused many investors to lose confidence in equity investments like stocks and real estate. During the same time period, historically low interest rates on products with less risk, such as bonds, fixed annuities, and CD's have reduced their potential to build wealth and keep up with inflation. In addition, the likelihood that interest rates will rise in the future increases the risk of investing in fixed income options.

If you are looking for investments that offer protection for your investment principal, your retirement income, or both, consider learning more about the following options:

Fixed Deferred Annuities:

  • for investors seeking zero risk of principal loss from market declines
  • similar in concept to a Certificate of Deposit (CD), fixed annuities offer both guaranteed principal - no risk of market losses, and pay a guaranteed interest rate for a specified number of years.
  • after the initial interest guarantee period, interest rate may reset higher or lower than the initial rate, but will never be less than a contractual minimum guarantee
  • no annual contract or investment fees
  • surrender charges and/or market value adjustments may apply to withdrawals for a specified number of years after contract issue
  • unlike a CD, annuities are issued by life insurance companies, and are not guaranteed by FDIC insurance. Annuity guaranteed values are backed by the claims-paying capacity of the issuing insurer (click here for links to information about insurer safety).
  • state insurance guarantee associations may provide protection in the event that an individual insurer is unable to fully honor their contractual obligations to an annuitant (click here for more information).

Equity Indexed Annuities:

  • designed for investors seeking zero risk of principal loss
    • fixed annuities with guaranteed principal - no risk of market losses
  • potential to earn higher interest than fixed-interest, guaranteed options, based on a calculation linked to the performance of an equity index, like the S&P 500
    • maximum annual interest is limited by a specified cap or spread
    • no interest is paid in years when the index value calculation is negative
  • no annual contract or investment fees
  • riders may be available to guarantee lifetime income, regardless of the amount of interest earned
  • surrender charges and/or market value adjustments may apply to withdrawals for a specified number of years after contract issue
  • annuities are issued by life insurance companies, and are not guaranteed by FDIC insurance. Annuity guaranteed values are backed by the claims-paying capacity of the issuing insurer (click here for links to information about insurer safety).
  • state insurance guarantee associations may provide protection in the event that an individual insurer is unable to fully honor their contractual obligations to an annuitant (click here for more information).

Hybrid Indexed Annuities:

  • designed for investors willing to accept limited risk of principal loss
  • may offer higher annual maximum interest potential than Equity Indexed Annuities in exchange for exposure to some degree of potential downside risk
  • depending on the contract, potential annual losses may be limited to a stated maximum percentage, or some percentage of the total decrease in the index may be covered by the annuity company, with the remainder charged to the contract value
  • may be free of annual contract or investment fees
  • surrender charges and/or market value adjustments may apply to withdrawals for a specified number of years after contract issue
  • annuities are issued by life insurance companies, and are not guaranteed by FDIC insurance. Annuity guaranteed values are backed by the claims-paying capacity of the issuing insurer (click here for links to information about insurer safety).
  • state insurance guarantee associations may provide protection in the event that an individual insurer is unable to fully honor their contractual obligations to an annuitant (click here for more information).

Annuities with Guaranteed Lifetime Income Benefit Riders:

  • designed for investors seeking guaranteed retirement income, while retaining control of invested principal, and the ability to leave remaining funds to their beneficiaries upon death
  • riders guarantee that the contract owner can withdraw a specified amount from the contract each year for life, even if the contract value declines or is completely depleted
  • most annuities offer single or joint lifetime income riders
  • a fee is charged against the contract value each year for the lifetime income rider
  • annuities are issued by life insurance companies, and are not guaranteed by FDIC insurance. Annuity guaranteed values are backed by the claims-paying capacity of the issuing insurer (click here for links to information about insurer safety).
  • state insurance guarantee associations may provide protection in the event that an individual insurer is unable to fully honor their contractual obligations to an annuitant (click here for more information).

Tactically Managed Investment Accounts:

  • appropriate for investors wishing to invest in equity and/or fixed income markets with potentially lower exposure to market losses
  • portfolios of securities are actively managed with the objective of un-capped upside growth potential with limited drawdown risk
    • no guarantees that objectives will be met or that drawdowns will be limited
  • bull-market performance may trail market benchmarks as a result of the manager's risk-management strategies
  • portfolios may consist of stocks, bonds, mutual funds, ETF's, or other securities
  • direct fees may be charged to the investor's account in addition to portfolio expenses