Andrew Corbman: Are Fixed Index Annuities for You? Part 2

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In Part 1 of this two-part series on fixed index annuities, Andrew Corbman discussed what fixed index annuities are and what makes them unique financial products.

One reason why fixed index annuities get a lot of bad rap is because of their cap rate. However, if you’re highly averse to risk and are looking for diversification, a fixed index annuity is a great way to boost your stream of retirement income. Not everyone has the time and talent to time the market so in a volatile environment, fixed index annuities provide guaranteed protection to your principal and investment returns, if any.

Are Fixed Index Annuities for You?

As mentioned, fixed index annuities are best suited for certain types of people whose goals can be met with the guaranteed returns. For instance, Andrew Corbman recommends fixed index annuities for retirees who fear outliving their savings. Essentially, they can take a portion of their nest egg and put it in a fixed index annuity and in return, they can enjoy guaranteed returns, with a regular and predicable stream of income. Why is this worth mentioning? Retirees can benefit from the predictability of receiving income as it might help make budgeting easier.

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Another instance when fixed index annuities make perfect sense is when you can’t get life insurance for one reason or another. If you have a serious health condition, you’d know that getting life insurance is close to impossible. Andrew Corbman points out that the great thing about fixed index annuities is that you can name your loved ones, such as your heirs or spouse, as beneficiaries. Remember that annuities are contracts, so should anything happen to you, the annuity will automatically be passed on to your beneficiaries.

Andrew Corbman explains that fixed index annuities may also come with optional riders. These riders are like life insurance policies in that they can enhance your contract to meet your needs. For example, income riders guarantee a specific growth rate to the income produced by your annuity, thereby boosting your income when you start to withdraw. There are other riders available such as the LTC double benefit, which doubles your income if you’re in a nursing home during your retirement years.

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As with any financial product, it’s best to consult a credible financial advisor who can guide you on the pros and cons of fixed index annuities. Andrew Corbman has worked alongside his clients personally, helping them meet their retirement objectives.