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An indexed annuity (the word equity previously tied to indexed annuities has been removed to help prevent the assumption of stock market investing being present in these products) in the United States is a type of tax-deferred annuity whose credited interest is linked to an equity index—typically the S&P 500 or international index.
What Is an Index Annuity? Index annuities–also known as indexed annuities–are a hybrid investment and insurance product that offers investment returns based on a market index, such as the S&P 500.
Indexed annuities tie your returns to a market index like the S&P 500, providing market exposure while protecting you from potential losses. When the index rises, you receive a portion of the gains.
A deferred annuity that permits allocations to stock or bond funds and for which the account value is not guaranteed to stay above the initial amount invested is called a variable annuity (VA). A new category of deferred annuity, called the fixed indexed annuity (FIA) emerged in 1995 (originally called an Equity-Indexed Annuity). [5]
For example, an indexed annuity can also be called a fixed indexed or equity indexed annuity. Pay attention to how the rate of return is calculated on the product and how payments are structured ...
Indexed annuities are a type of fixed annuity which are regulated and distributed in the same manner as fixed annuities (through licensed insurance agents). Indexed annuities are a conservative safe money place for retirement dollars. [4] Indexed annuities usually provide a purchaser with various options for interest crediting.
Annuities are a popular option for people planning for retirement, but there are many different types of annuities that you can choose from. One popular option is an indexed annuity, a hybrid type ...
The main risk with a variable annuity is that you could lose money. Indexed. In an indexed annuity, your return is based on changes in a market index, such as the S&P 500 Composite Stock Price ...