How would you like to own an annuity that locks in stock market gains when the market is rising, but also protects your investment against any losses when the market is falling? That's right, your policy value is never reduced because of negative stock market performance.
Believe it or not, there is such an investment product and it's called an Equity-Indexed Annuity. With an Equity-Indexed Annuity, your return is tied to the increase in one of several stock market indexes, such as the S&P 500.
However, if the stock market goes down, you do not lose any of your money. In fact, most Equity-Indexed Annuities will even GUARANTEE you a minimum annual return (typically 3%), even if the index you invested in goes down the entire time you are invested. An Equity-Indexed Annuity is a great place to protect the money you've saved in your CDs, money market accounts, IRA accounts, etc. Or perhaps as an alternative for the money you currently have invested in stocks and mutual funds. Equity-Indexed Annuities can greatly improve your earnings potential, while at the same time keep your principal safe from market fluctuation.
Additionally, Equity-Indexed Annuities are a good option for people who already own annuities and have seen their interest rates drop substantially. Many people do not realize that you can easily trade-in an older, possibly under-performing annuity for one that better suits your needs.
This exchange can be accomplished with no out-of-pocket expense or current taxes to pay!
Just how good of an investment are Equity-Indexed Annuities?
Well, if you had bought one just before the collapse of the stock market instead of investing directly in the stock market itself, you would be a much happier person right now!
