This year, fixed indexed annuities (FIAs) celebrated their 20th anniversary, initially introduced to consumers as a key product that would help them plan for a financially secure, reliable retirement. They were created as a reaction to the economic volatility that affected the bond and stock markets in 1994. However, there’s still some confusion about FIAs, which can potentially make conversations with prospective investors challenging.
There’s no shortage of information available on the Internet on the various types of annuities. Consumers who research annuities on their own can find a wealth of articles arguing for – and against – annuities purchase. It can be daunting for individuals to sort through the information and get to the real story on annuities in general and fixed indexed annuities in particular. They need to depend on their brokers for reliable information.
The Indexed Annuities Leadership Council (IALC) offers five facts consumers need to know about FIA benefits and why this type of annuity can be a great investment. These five facts can help get the conversation started.
1. FIAs are worth the conversation. Says IALC, FIAs offer the opportunity for growth through a steady, guaranteed lifetime income stream while the principal is protected from the uncertainty of market volatility.