Is a Fixed Indexed Annuity right for me?


If you:

àhave a retirement plan in place, but want to add balance to the mix

àneed your earnings to never fall below zero

àwant growth potential, coupled with principal protection from market loss

àseek a guaranteed minimum rate of return that never varies

àare interested in an annuity where the insurance company assumes the risk

… then a Fixed Indexed Annuity might be right for you


What is a Fixed Indexed Annuity??

Simplest terms: It is a vehicle that provides upside potential from market returns with no downside risk.

A fixed indexed annuity is a tax-deferred savings vehicle that provides principal protection in a down market and opportunity for growth in market upticks. It gives you more growth potential that a traditional fixed annuity or multi-year guarantee annuity with less risk (and less potential return) than a variable annuity.

Returns are based on the performance of an underlying index, typically the S&P 500®Composite Stock Price Index.  This is collection of the 500 stocks intended to provide an opportunity for diversification and represent a broad segment of the market. Because the carrier is actually buying “futures” in the market, your money is never directly exposed to market woes.

There are several different indexing options you can choose from.  But let’s just take a look at 2 for now.  These are my favorite indices to use: Annual Point to Point and Monthly Point to Point

Annual Point-to-Point

You deposit $100,000 into account with an annual point to point strategy on March 1, 2019 and the S&P closes at $2,900 that day. The contract states an annual pt2pt cap of 6.25%.

On the policy’s anniversary, March 1, 2020, the S&P closes at $3,500.  That’s 20.7% return.  However, the plan was capped at 6.25%, so your account is only credited 6.25%.

Under the same scenario with a Monthly Point to Point Strategy which has a monthly credit cap of 1.5%. If every month was an uptick, your account would be credited 18%.

The annual point-to-point strategy is the easiest to understand but the monthly can allow for greater returns to be credited.

I didn’t want to get too far in the weeds with my examples.  I am happy to go into further detail.  If you would like to setup a time to talk, please feel free to email me at