Fixed Indexed Annuities

Here's a message from one of our finest carriers, National Western Life about some of the financial products they offer.

Fixed Indexed Annuities Explained

Fixed Indexed Annuities (of FIA's) allow you to invest retirement funds into a safe place that will never lose a dime; however, you can still enjoy some of the growth of an indexed fund such as the S&P 500.  You can also create an income stream from your FIA that you cannot outlive.  If you were to die during the annuitization period, your entire account value flows tax-free to your beneficiaries.  This is similar to a life insurance policy that avoids probate and is paid out tax-free directly to the ones you love. Indexed Annuities, or (FIA's) are a great way to protect your hard earned nest egg from market losses such as occur in traditional investment vehicles such as a 401(k) or Mutual Funds.  With a FIA, you enjoy some of the gains from the S&P 500, but participate in none of the losses when the market corrects.  It's a great way to safely protect your retirement account and also enjoy compounded interest growth from the stock market.  The best of both worlds can be yours.

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Safe Money Places

Call us today to schedule a free in home/office consultation to discuss the benefits of investing in a Fixed Indexed Annuities.  FIA's allow you to earn a decent return on your investment because they are indexed with the S&P 500.  You enjoy some of the growth of the market without experiencing any of the losses when the market corrects.

Got an old 401(k) from a past employer?

We will work directly with you to transfer your funds into your new annuity safely without triggering a taxable event.  The IRS allows this through a section 1035 exchange.  We work with Burlington Alliance Capital Management (BACM) brokerage to transfer your retirement funds safely, directly and expeditiously without having to get permission from your current funds custodian.  Your funds simply transfer by your brokerage order from one IRA to another IRA qualified account.  We charge zero fees or administrative costs to do this.  This way you get 100% of your funds transferred instead of paying a transfer or transaction fee.  

Immediate bonus on first year's premiums

Most of the FIA products we offer at Lehman Financial will pay you a bonus up to 14% on your first year's premium deposits into your new account.  For example:  A deposit of $100,000 could earn you a day one immediate bonus of $14,000 in your FIA total contract value.  Where else can you get this type of return on your money immediately?  

These are some common questions we have had from our clients about FIAs



FAQs About FIAs


What is a fixed indexed annuity?

A fixed index annuity (FIA) is a fixed annuity that provides the opportunity for a guaranteed lifetime income and interest rate while preserving and protecting your principal. You do not pay income taxes on your premium or any interest earned until you take withdrawals or receive income. Unlike traditional fixed annuities, interest may be earned based on positive changes in commonly used financial indices such as the S&P 500 or the Dow Jones Industrial Average. Because the annuity you purchase is indexed, your premium and credited interest can never be lost due to market risk. Keep in mind, that early withdrawals beyond what is permitted in the contract may be subject to surrender penalties, which may reduce the amount of your principal and any interest earned.


Someone told me that my annuity has fees. Is this true?

Yes, all insurance and annuity products have some fees. Often, these fees are not transparent to you and are built into the pricing of the product and are instead reflected in the interest you can earn, the income payout rates, surrender penalties for early withdrawals and other contract elements. There may also be additional, specific fees associated with the purchase of additional benefits or riders if you elect them.  Our FIA experts at Lehman Financial will work with you and the insurance company to eliminate or minimize any potential fees to your account.  


How can I learn more about fixed indexed annuities?

We strongly encourage you to visit the website of the National Association for Fixed Annuities (NAFA) at www.nafa.com.


How safe is a fixed indexed annuity, and can I liquidate my FIA?

A fixed indexed annuity is a contract between you and the insurance company that issues your contract. Fixed indexed annuities are subject to state insurance department regulation, which sets standards for the amount of reserves an insurance company must hold to make good on their promises. The annuity guarantees are backed by the financial strength and claims-paying ability of the insurance carrier. Each state's insurance regulator maintains jurisdiction over the insurance carrier and determines the specific amount and level of protection to which the individual consumer is entitled.


Can I liquidate my annuity?

Yes, there are many options available for withdrawing your money. The annuities we offer allow you to withdraw up to 10 percent after the first year – without a surrender penalty.  Then each subsequent year most of our partner companies allow an additional 10% withdrawal after the first contract year.  In the event of premature death, your beneficiaries can choose to receive your annuity's accumulated value as a monthly or lump sum payment.  However, at Lehman Financial, we recommend looking at these funds that you are considering for a FIA as a long term investment.  These funds should ideally be allocated as money you do not need for a while, but want it to grow with the stock market and still be completely protected from any market losses.  


Are there really rate caps that limit the amount of interest I can earn?

Unlike most other investment tools, FIAs are insurance products and are designed to provide an increased level of protection against prolonged market downturns. Although the interest rate is limited, your principal and any interest earned are not at risk of loss due to bear markets or weak economic conditions. If the index upon which your annuity is based performs well, you can receive a percentage of that growth in the form of interest credits. Should the market take a nosedive, your principal and earned interest will not be lost, assuming you do not take early withdrawals above the permitted amount.


Aren't there other financial or investment options with unlimited growth potential?

Yes, there are; however, most of these options carry with them the corresponding potential for loss.


How do I know if a fixed indexed annuity is right for me?

As Jon always points out at his insurance seminars, there isn't a perfect financial tool. It is our belief that consumers’ needs and objectives vary, but as a general rule it is often advisable to move towards more conservative products as they grow older. Our average client is typically at or nearing the age of retirement and wants to preserve and protect all or a portion of their assets. If you want unlimited growth potential and are willing to assume the investment risk, then a fixed index annuity may not be right for you. If you are concerned about protecting your principal and enjoying a conservative, competitive interest rate on a portion of your retirement savings, then we feel you should contact Lehman Financial Retirement Planning Group.  We will put you directly in touch with our trusted partner Burlington Alliance Capital Management retirement investment credentialed professionals, who will help safely guide you during the decision making process.