We find ourselves not only in a questionable stock market, but also in a depressed real estate market resulting from sub-prime lending troubles. With all of this bad news is there anything good left to talk about when it comes to your savings? Does this mean there is no hope for you? Absolutely not!

Let’s first understand what investors have been exposed to since April 1, 1999. Then, the S&P 500 index was trading at 1293.72. Ten years later the index closed at 1370.18. That is an average annual growth rate of 0.64 percent per year. The challenging thing for most investors is that the index spent over 61 percent of the last nine years trading below the 1999 closing value. Investors trying to access their funds during this period would most likely have done so at a loss. Between 2001 and 2006, these losses could have easily ranged from -10 percent to more than -35 percent. As the market climbed back to break even, those individuals who sold at a loss would have missed the opportunity for recovery.

Consider another way to think about this:

If you were invested in the S&P 500 Index with $100,000 in 1999, your investment would now be worth $105,910 assuming you made no withdrawals.

Over the last nine years, there were actually five years when the S&P 500 was higher than it had been 12 months earlier. The problem is that most of these years of gain were spent climbing out of a deep hole. Even when investors were experiencing an increase in their investment value, it was less than what they started with.

Wouldn’t it be great if you could participate in the good years while sitting out the bad? What would happen if we had $100,000 over the last nine years that grew when the market index went up, but didn’t lose a penny when the index went down?

This is exactly what a fixed indexed annuity is designed to do. An FIA is a long-term savings vehicle created by an insurance company. It is an insurance contract that links the interest credited in the account to the performance of an external market index. If the market index rises, your interest credits increase. If the market index falls, your interest credits are reduced but can never be less than zero.

It is important to know that there is an upside limit to the amount of interest an FIA can pay in any one year. This limited upside potential allows the insurance company to eliminate the downside. In addition, like all tax-deferred annuities, there are charges if you surrender your contract prematurely. During your accumulation period, all interest is credited on a tax-deferred basis. Should you need access to some of your money, most annuities offer an annual penalty-free withdrawal.

FIAs are an innovative alternative to traditional fixed interest savings vehicles. Your principal and any interest credits are protected and guaranteed by the insurance company. FIAs can also be a great source of future income allowing you to create a customized lifetime of guaranteed income payments you can never outlive.

While the future may be uncertain for investors, a fixed indexed annuity owner can rest assured that his or her assets are safe and secure. Because of their unique characteristics, you can truly grow your assets in a volatile market utilizing an FIA.

Andy Unkefer is president and CEO of Unkefer & Associates Inc. in Glendale, Ariz. For the past 14 years, he has focused on serving independent agents, agencies and mid-sized insurance marketing firms at his national annuity and life marketing organization. He has also contributed consulting services to several insurance companies including product design and development of sales material, and is a member of the Best Practices Committee for NAFA. Call 800.523.5851 or go to www.unkefer.net for more information.