A fixed indexed annuity is a contract with an insurance carrier designed to help you accumulate retirement assets and generate dependable income — with principal protected from market-related index losses, subject to contract fees and surrender charges.
A fixed indexed annuity (FIA) is a long-term contract between you and an insurance carrier. You pay a premium — either as a single deposit or a series of payments — and the carrier credits interest based on the performance of an external market index (such as the S&P 500), subject to a cap, participation rate, or spread defined in your contract.
In exchange for accepting limits on the upside, you receive something the markets cannot offer: a contractual floor that protects your premium from index-related losses. When the index goes down, your contract value does not decline due to negative index performance. Fees, surrender charges, and rider costs may still reduce your contract value.
You move qualified or non-qualified dollars into the annuity as your premium. Common funding sources include 401(k) rollovers, IRA transfers, CDs, savings, or proceeds from another annuity (a 1035 exchange).
You choose from indexed crediting strategies (for example, an S&P 500 annual point-to-point) and/or a fixed account. Each strategy has its own cap, participation rate, or spread that defines how index gains are credited.
If the index is down, you are credited zero for that period — your contract value does not decline due to index loss. Contract fees, rider charges, and withdrawals can still reduce value.
FIAs are not designed for money you may need quickly, short-term goals, or anyone unwilling to accept surrender charges during the contract's early years.
Grow retirement assets with index-linked crediting and a contractual floor against index losses — especially in years leading up to retirement.
Optional income riders (for an additional fee) can provide a guaranteed income stream for life — even if the contract value runs out — subject to the rider's terms and carrier claims-paying ability.
For qualified money, FIAs can be structured to support Required Minimum Distributions starting at age 73 (current law) without disrupting the contract's growth strategy on remaining funds.
FIAs typically pass to your named beneficiaries outside of probate. Some contracts include enhanced death benefit riders for an additional cost.
We believe in showing both sides of every product. Before considering an FIA, you should understand:
We walk through every one of these with you before any recommendation — in writing.
A 30-minute conversation about your retirement goals, current accounts, income needs, and concerns.
We review FIA contracts from carriers we are appointed with and identify ones that may fit your situation — side by side.
California's best-interest standard for annuity recommendations (Insurance Code §10509.910 et seq., in effect since January 1, 2025) requires us to document why a recommendation is in your best interest — for every client, at every age. California's senior-protection rules (§§785–789.10) add further duties when you're 65 or older. You get the analysis in writing.
We coordinate paperwork, funding, and carrier setup. After issue, annual reviews keep your strategy aligned with your goals.
