Independent Study

Financial Consideration: The Importance of Seeking Impartial Third-Party Research on Fixed Indexed Annuities

Independent Analysis Regarding Fixed Indexed Annuities

Fixed indexed annuities can serve as a valuable option for saving and retirement planning. Our website outlines many features and benefits associated with these financial instruments. However, we encourage you to supplement our insights with research findings from impartial third parties to gain a more comprehensive understanding of whether a fixed indexed annuity aligns with your financial goals.

The Wharton Financial Institutions Center at Wharton College, Pennsylvania, published a report titled “Real World Index Annuity Returns,” which utilizes actual data from policyholders to present a reliable evaluation of the performance of these products*. We trust that you will find this information beneficial and invite you to review the complete report available here.

To provide a glimpse of the report’s findings, we have included several notable excerpts below:

♦ “The article will explore additional features of fixed indexed annuities that are not present in conventional securities, as well as various principal protection programs.”

♦ “Annuity returns have been competitive with alternative stock and bond portfolios. From 1997 through 2007, the five-year annualized returns for fixed indexed annuities averaged 5.79%.”

♦ “Almost 96% of fixed indexed annuities include reset (or ratchet) features that enable policyholders to lock in positive returns annually or biannually. This design minimizes the adverse effects of significant stock market declines, reducing the necessity of capitalizing on large market upswings to recuperate losses.”

♦ “Unlike mutual funds, fixed indexed annuities do not incur sales charges, management fees, or 12b-1 marketing fees. Instead, the insurance company allocates a small portion of the underlying portfolio to manage administrative expenses and broker commissions.”

♦ “For moderate and risk-averse individuals, fixed indexed annuities are tailored to mitigate downside risk and typically yield more favorable return patterns compared to other investment strategies that expose investors to significant risk.”

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*This article is shared as a resource for your benefit. Please be advised that the information and opinions contained herein are sourced from third parties considered reliable; however, Future Benefits or its agents cannot guarantee their accuracy or completeness. We do not function as stock brokers or financial advisors and do not provide investment advice. Additionally, we are not tax advisors and do not offer tax advice.

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