Indexed Interest Potential
Fixed indexed annuities offer growth potential without market risk. Let Mundt and Associates help you secure your retirement savings.
Benefits of Fixed Indexed Annuities
You’d be forgiven for thinking that, because of its name, flexibility is not one of the benefits of fixed indexed annuities. Quite the contrary, a fixed index annuity (FIA) provides a wide range of options. For example, you may be able to select the index or indexes that you want. But, what is indexed interest potential, and why does it make an FIA such an advantageous tool for protecting and growing your retirement money? Reach out to us to learn more.
How Fixed Indexed Annuities Grow
Ensure your annuity is set up to correspond with at least one index. Your annuity could use one of several different crediting methods, but the most important part is that your interest rate will rise when the index does. You will see higher interest** when the index is up, yet suffer no losses when the index is down. There are some factors that will impact your interest rates–we can walk you through those, too. If an FIA sounds like the right option for you, reach out to us. You can attend one of our seminars to learn more about the benefits fixed index annuities. Or, you could schedule a one-on-one meeting with us to discuss your goals, needs, and if an FIA could be the right choice for you.
What Affects Interest Rates
It’s important to consider a few factors that may impact your FIAs interest rate.
For example:
- The cap is a ceiling on the amount your FIA can earn during a specific period. If your chosen index increases over the cap, the cap is then used to calculate your interest rather than the index rate.
- The participation rate is used to measure your interest rate, and is typically implemented after the cap but before the spread.
- And the spread is a percentage of interest deducted over a certain amount of time. For example, if the spread is 5% and the index increases by 9%, the annuity contract would receive a credit of 4% indexed interest.
