Buying Indexed Annuities
Where do I go to invest in an indexed annuity?
Before figuring out where to go for an indexed annuity, it’s really important that the client have a base understanding as to what the product is.
The indexed annuity offers the client an opportunity to have an investment that is dependent on market performance, without the risk of losing their premium in the instance of a market decline. The fact that you are not guaranteed set payments (as you would be with a fixed annuity) offers you potential for higher growth. It should be noted that indexed annuities will always have a minimum return of premium (i.e. worst case scenario) and will also carry a “cap” (i.e. best case scenario).
Where do I go for more information?
There are so many places for a potential client to go for annuity information, it’s almost nauseating. The very best place to get discrete and accurate information is from an independent insurance broker. The reason you want to visit an agent who is completely independent and on their own is that they have no allegiance to a specific insurance carrier. Agents who work for a specific company do not have access to all different types of products, and they could potentially try to force your investment into a box that it does not fit into.
What carriers do you represent?
This can be a very telling question what you are searching for a sound solid independent agent. When the broker lists the carriers that he/she works with, ask what the carrier’s ratings are. If the broker has a lot of companies that have “B” or “B+” ratings, that’s not a great sign. This means that the strength and stability of the company has been in question. Now, if all of their carriers are “A” and “A+” rated, that tells you that this broker is very keen on working with companies that have great integrity and financial stability. These are the guys you want to be working with.
How long have you been in the industry?
Although all agents have an insurance license, there are quite a few different ways that agents can distinguish themselves from one another. It’s important that you know how long the agent has been in the industry, not because that makes them better or worse, but it means that they have had more time to go through various education processes, such as the College for Financial Planners. It’s important to ask a prospective agent what types of continuing education they have taken part in, so that you can get a grasp for how much they really know about the industry. This is a person you could potentially be putting a huge amount of money with, so you need to make sure they are informed on their industry, inside and out.
Does this agent have my best interest, or their wallet’s?
It’s no secret that insurance agents make commissions. It’s a sales industry and the only way they get paid is by selling, selling, and more selling. Once you have an idea of their carriers, and their industry experience, it’s important to figure out whether the agent is giving you the best product, or the product with the sexiest price tag. For the most part, brokers are going to do everything in their power to get you the most suitable product for your goal structure, but it’s important that you have a few options to pick from and that you cross reference your recommendations.
- Fixed Annuity Features
- Fixed Annuity Performance
- Finding the Best Fixed Annuity
- Fixed Annuity Disadvantages
- Fixed Annuity Pitfalls
- Immediate Fixed Annuities
- Deferred Annuities
- Multi-Year Guaranteed Annuities
- Equity Indexed Annuity Features
- Equity Indexed Annuity Performance
- Finding the Best Equity Indexed Annuity
- Equity Indexed Annuity Disadvantages
Annuity Calculator & Quotes
If you are considering buying an annuity, let us run you a free, no obligation quote to give you a better idea of what you can expect. You can also contact a local annuity specialist to answer any specific questions you may have.