What if you had the potential to grow your retirement savings with less worry of loss? With indexed annuities, you can.
Indexed annuities are a type of fixed annuity. They offer the best of both worlds—safety and the opportunity for additional growth—for your long-term retirement planning objectives. Another benefit? They can also provide guaranteed income in retirement that you can’t outlive.
Like a fixed annuity, an indexed annuity is an insurance contract you purchase to help grow your retirement savings safely and guarantee your income in retirement. However, the main difference is that it gives you the opportunity to participate in market growth, too.
Here’s how it works: An indexed annuity offers competitive interest rates linked to one or more published, equity-based indices (like the S&P 500 Index®). Index crediting is what provides the growth potential. Credits are based on how the market performs in any given year and are applied to your existing premium at the end of each contract year.
If the index goes up, the value of your annuity is credited with an earnings rate up to a set cap. If the index goes down, you won’t receive a credit from that year, but it also means your premium is protected from market losses
You purchase an indexed annuity with a one-time lump sum payment (your principal). In return, you get:
An indexed annuity can help you keep pace with inflation and ensure your income payments support your lifestyle for as long as you need.
Visit our annuities help section, or call us at 800-852-4450.
Annuity products and services are offered through Principal Life Insurance Company, a member company of Principal, Des Moines, Iowa 50392.
Guarantees are based on the claims paying ability of Principal Life Insurance Company.
Withdrawals prior to age 59½ may be subject to a 10% IRS penalty tax.
Tax-qualified retirement arrangements, such as IRAs, SEPs, and SIMPLE-IRAs are tax-deferred. You derive no additional benefit form the tax deferral feature of the annuity. Consequently, an annuity should be used to fund an IRA, or other tax qualified retirement arrangement, to benefit from the annuity’s features other than tax deferral. These features may include guaranteed lifetime income, guaranteed minimum interest rates, and death benefits without surrender charges.
