6 reasons why fixed index annuities should be part of your retirement portfolio

ImageFixed index annuities are products offered by insurance companies that can add diversification and safety to your retirement portfolio. Below are 6 reasons why fixed index annuities should be part of your retirement portfolio.


Principal protection

When you purchase a fixed index annuity (FIA), your principal is guaranteed against loss by the life insurance company you purchase it from.


Opportunity for growth

FIAs can grow in value with interest credited on a periodic basis, typically annually, based on the performance of an index such as the S&P 500. While you may not receive 100% of the index’s gains in a particular period, most FIA will “lock-in” your gains when they are credited and will protect those gains from loss also.


Interest credits are tax-deferral

When interest is credited to your FIA in a non-retirement account, taxes on it are deferred until you actually decide to receive the cash. FIAs in a retirement account are treated exactly like any other asset you may have in it … no taxes are due until you take a distribution.


No fees

Most FIAs have no explicit fees to be paid either initially, annually or on distribution.



Most FIAs will allow you to take penalty-free withdrawals of up to 10% each year starting after the first year. There can be early withdrawal fees for withdrawals in excess of the amounts allowed by the FIA.

Lifetime income

Perhaps the most unique aspect of a FIA is that there is typically a way to convert it to an asset that will provide you with a guaranteed monthly income for the rest of your life.

"Education is the key to making informed financial decisions." -- Elliot Goldberg, Independent Registered Investment Advisor (610) 999-3599
“Education is the key to making informed financial decisions.” — Elliot Goldberg

FIAs are not for everyone. But if you are looking for safety with the opportunity for growth, consider a FIA for part of your retirement portfolio. Please call me at (610) 999-3599 for more information.

Leave a Reply

Your email address will not be published. Required fields are marked *