Meet Today’s Client Challenges with a Fixed Indexed Annuity.
If you haven’t looked at annuities in a while, you need to see this.
The reason that most people buy an annuity is the guaranteed lifetime income. While bonds, CD’s and money market accounts help to bring balance to a retirement account, none of them offer them peace of mind and income they can’t outlive. The longer your client receives their income, the higher the guaranteed minimum income benefit value.
People are Living Longer
The life expectancy for Americans today is 76 for men and 81 for women.¹ For many, their retirement will need to last at least 20 years but for some it may need it to last even longer. With a fixed annuity, your clients can have the assurance that they will receive a steady income stream for life they cannot outgrow.
Protecting Retirement Dollars with Money Market, CD’s, and Bonds
While Money Market, CD and Bond allocations can help safeguard against losses, they typically produce lower returns. Here is a snapshot of December’s rates from Bankrate.com:
According to bankrate.com, current average rates for the week of Dec. 16:
- 1-year CD rates: 0.23%
- 5-year CD rates: 0.39%
- 1-year jumbo CD rates: 0.25%
- 5-year jumbo CD rates: 0.40%
- Money market account rates: 0.09%
Since the Federal Reserve lowered the fed funds rate twice in March, CD and money market account (MMA) rates have been declining at many banks. Declining Treasurys may also cause CD rates to decrease.
In addition, these products are typically short-term vehicles only and were not created for the primary purpose of creating income in retirement. Annuities on the other hand are long-term retirement income products designed to ensure lifetime income, in addition to other benefits such as tax deferral, optional riders and a death benefit. Like all financial products, annuities involve fees, charges and restrictions, including surrender penalties for early withdrawals. However, when managed appropriately, they can also offer the opportunity for a greater return than many bank products as we explained above.
Market Volatility Remains Elevated
The VIX, otherwise known as the Volatility Index is an indicator of the next 30 days market expectation of volatility. In March of 2020 it was as high as 82.69 and in February of 2021 it was as low as 13.68. As of February 8, 2021 it is at 21.64.
^VIX (CBOE Volatility Index) – Feb 10, 2020 – Feb 8, 2021
Call us today at 800-446-2649 to find out more about our products and to show your client how the income rider can secure a lifetime of income.
Ryan GriffinDirector of Advisor Consulting978-605-1174
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¹National Vital Statistics Reports Volume 69, Number 12 November 17, 2020 United States Life Tables, 2018 (cdc.gov)² Source: How to Compare Permanent Life Insurance Policies (investopedia.com), December 10, 2020Bonus annuities may include higher surrender charges, longer surrender periods, lower caps, higher spreads, or other restrictions that are not included in similar annuities that don’t offer a bonus.
Annuity withdrawals are subject to ordinary income taxes, and if taken before age 59-1/2 may incur an additional 10% federal penalty.
Nationwide New Heights fixed indexed annuity is issued by Nationwide Life and Annuity Insurance Company, Columbus, Ohio. Guarantees and protections are subject to the claims-paying ability of Nationwide Life and Annuity Insurance Company.
Neither Nationwide or any of its affiliates are related or affiliated with Auxani.
For Financial Professional use only. May not be used with or shown to consumers.
© 2020 Auxani, LLC |. Privacy Policy
Disclosure:
*Rate provided as of 8.6.2020 from https://www.cnbc.com/quotes/?symbol=US10Y.
FOR REGISTERED REPRESENTATIVE USE ONLY. NOT TO BE USED FOR CONSUMER SOLICITATION PURPOSES.
Guarantees apply to certain insurance and annuity products and are backed by the issuing insurance companies claims paying ability and financial strength. Guarantees are subject to product terms, exclusions and limitations. Clients should be instructed to read their contracts carefully.Deferred Income Annuity contracts are irrevocable, have no cash surrender value and no withdrawals are permitted prior to the income start date.A contract’s financial guarantees are subject to the claims-paying ability of the issuing insurance company.Insurance products are not FDIC insured or guaranteed, may lose value, and have no bank guarantee.
