Fixed Index Annuities Safe?

Q: I saw your article (Check out articles on annuities). A lady is pitching me on a Fixed Index Annuity fund. Is it safe ? I am 56 yrs old.

A: I am not a fan of Equity Indexed Annuities and many people find that they work much differently than they expected. There’s no such thing as a ‘free’ bonus, you may only receive it if you fulfill all the details of the contract. In this case, it sounds like that can take 15 years.

Personally, I would prefer the Freedom fund where I could retain complete control and flexibility. Then I wouldn’t have to worry about massive surrender penalties if it turned out I didn’t like the annuity or my situation changed and I needed that money.

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