Annuities are long-term investments. Guarantees are subject to the claims paying ability of the issuing insurance company. Annuities contain mortality, expense charges, account fees, management and administrative fees, and charges for features and riders. Additional fees apply for living-benefit options. Investment restrictions may also apply for all living benefit options. Violating the terms and conditions of the annuity contract may void guarantees.
Withdrawal of earnings will be subject to ordinary income tax and, if taken prior to age 59½, may be subject to a 10% federal tax penalty. Withdrawals can lower the cash value and decrease death benefits. Surrenders before the end of the annuity’s term can result in a loss of principal.
Indexed annuities are long-term investments offering tax-deferred gains linked to an underlying market index. While the return is based on the performance of the index, the investor does not get the full benefit in a rising market. A participation rate, asset fee, or interest rate cap are some of the features used by indexed annuities to determine how much potential gain will be credited to the annuity. These features can change annually, so investors must carefully evaluate a contract to evaluate these factors and how they can affect the investment return. The investor may be subject to substantial penalties for withdrawing money before the end of the term is over. Guarantees are subject to the claims paying ability of the issuing insurance company.
The S&P 500 is a market-cap weighted index composed of the common stocks of 500 leading companies in leading industries of the U.S. economy