Fixed Indexed Annuity Definition
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An indexed annuity is a type of annuity contract that pays an interest rate based on the performance of a specified market index such as the SP 500.
Fixed indexed annuity definition. Fixed indexed annuities are also commonly referred to as equity index annuities EIA or simply indexed annuities IA. It shares features with fixed deferred interest rate annuities. With a fixed indexed annuity investors receive a minimum interest rate over a certain number of years.
A fixed index annuity is an insurance contract that provides you with income in retirement. Your account value is protected against market loss but has the opportunity to grow by earning interest. Indexed annuities are a type of fixed annuity which are regulated and distributed in the same manner as fixed annuities through licensed insurance agents.
A FIA is a tax-deferred financial tool that is designed to provide long-term growth and safety. FIA contracts vary but this is how they work. Sales are booming 609 billion in 2016.
Join or renew your AARP membership today for money-saving discounts. Indexed annuities are a conservative safe money place for retirement dollars. Indexed annuities are tied to the performance of a specific stock market index such as the Dow Jones industrial average commonly referred to as the Dow the SP 500 or the Nasdaq composite.
A fixed indexed annuity FIA is an insurance product which produces a pension-like guaranteed income in retirement while also offering some liquidity and the. What Is a Fixed Annuity. A fixed-indexed annuity is a type of annuity that grows at the greater of a an annual guaranteed minimum rate of return.
This type of annuitys returns are usually based on the performance of an underlying index like the SP 500. It gives you more growth potential than a fixed annuity along with less risk and less potential return than a variable annuity. A fixed index annuity is an insurance product that allows your savings to grow in a tax-deferred manner.