Fixed indexed annuities are a complementary type of account that can allow you to protect and grow your wealth. They especially grow and protect the dollars you have in your 401(k) and IRA.

Fixed indexed annuities allow you to keep your gains each time you earn them—without risk of loss. They offer full principal protection and you get to keep your interest earnings regardless of what happens on Wall Street. Fixed indexed annuities can create retirement income, now or in the future, or they can safely grow your retirement assets for future use. They can be excellent at both jobs. 

How fixed indexed annuities work

Fixed indexed annuities offer interest based on upward market swings.  They help protect you against loss. They’re not actually invested in the market, but they offer options to link your interest earnings to market upswings. Therefore, you get the benefit of market performance without the loss exposure that typical market investments have.

Fixed indexed annuities have historically performed as well or better than investment-grade bond portfolios. They often have no fee drag to reduce your principal. 

In today’s world, with bond yields lowering further and further, people are often incentivized to either chase yield in lower quality bonds or chase returns in the market. The problem is that both of these strategies increase the risk to their principal. Risking all of your principal is counterproductive for building wealth.

It’s time to get your life savings and your future retirement off the roller coaster.

How much does an annuity cost?

The cost of an annuity depends upon the type of annuity purchased, the payout period, and the amount of income the owner wishes to receive from their annuity, among other factors. Like many financial products, annuities are customizable based on your personal goals and income.

Annuities offer these potential benefits:

  • Tax-deferred growth
  • Guaranteed income not found with typical mutual funds
  • No annual contribution limits
  • Annuities allow you to catch up on retirement savings
  • Annuities can guarantee you won’t outlive your money
  • Some annuities offer death benefits to a beneficiary

Now Is the Best Time for an Annuity

Looking ahead, fixed indexed annuities are poised to continue to deliver principal protection while giving you an opportunity to earn conservative or better interest credits that you get to keep. Using them after a crash is a potentially very good time to take advantage of their attributes.


Fixed indexed annuities benefit from market downswings. After a downswing, the corresponding market index you could use to gain interest often has a number of “up years.” During this time, positive interest credits would be earned in an annuity. One of the key reasons to consider diversifying some of your portfolio into annuities is to lock in positive gains without the risk of loss during the next crash.