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All written content on this site is for information purposes only. Opinions expressed herein are solely those of Samra Wealth Management, A Member of Advisory Services Network, LLC.  All information contained herein is derived from sources deemed to be reliable but cannot be guaranteed.  All economic and performance data is historical and not indicative of future results.  All views/opinions expressed herein are solely those of the author and do not reflect the views/opinions held by Advisory Services Network, LLC. The information and material contained herein is of a general nature and is intended for educational purposes only.  This does not constitute a recommendation or a solicitation or offer of the purchase or sale of securities. Before investing or using any strategy, individuals should consult with their tax, legal, or financial advisor.

© 2018 by SAMRA WEALTH MANAGEMENT, A Member of Advisory Services Network, LLC.

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A sometimes misunderstood, yet viable, vehicle for long-term savings is a fixed rate annuity (also called a fixed annuity). Fixed annuities can be used to help fund a variety of savings objectives, and can be particularly useful to investors seeking relative safety of their funds, as well as a stable source of income.

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Investors hear many—possibly conflicting—opinions about annuities. This article provides a concise overview of some common types of annuities to help your clients understand how each works and if annuities could be a good choice for their portfolios.

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As you are planning for your retirement, you may be considering purchasing an annuity, which can provide you with a steady flow of income for a limited period of time, or for the rest of your life. While there are many factors to weigh when you are thinking about buying an annuity, the tax advantages associated with many of these products can make an annuity an attractive investment choice.

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Investors looking to minimize risk, while still having some exposure to the stock market, may be attracted to the equity-indexed annuity (EIA). A relatively new insurance product, the EIA was created to appeal to people looking for a financial planning solution that entails less risk than the variable annuity, which does not offer a guaranteed rate of return but has more potential for growth than the fixed annuity, which pays a set rate of return.

Insurance products offered through various insurance carriers, none of which are affiliated with Samra Wealth Management, A Member of Advisory Services Network, LLC

Carefully consider the investment objectives, risks, charges and expenses of annuities before investing.  An indexed annuity is for retirement or other long-term financial needs.  It is intended for a person who has sufficient cash or other liquid assets for living expenses and other unexpected emergencies, such as medical expenses. Guarantees provided by annuities are subject to the financial strength of the issuing company and not guaranteed by any bank or the FDIC.

 

Indexed annuities do not directly participate in any stock or equity investment.  Clients who purchase indexed annuities are not directly investing in the financial market. Market indices may not include dividends paid on the underlying stocks and therefore may not reflect the total return of the underlying stocks; neither a market index nor any indexed annuity is comparable to a direct investment in the financial markets.