What will we discuss in this annuity review?In this review, we will be discussing the following information that pertains to the Allianz Life Retirement Foundation ADV annuity:
- Type of Annuity
- How the annuity works
- Benefits and possible drawbacks
- Where it may or may not fit well in an overall portfolio
Annuities can be complex. That’s where having an Annuity Investigator who loves math comes in. We make the complex, simple.
If you’re in the process of mapping out your retirement income plan, the Allianz Retirement Foundation ADV annuity could be a good option for you. That’s because this annuity provides the opportunity for market-linked growth, while at the same time keeping your principal safe in any type of market. The Retirement Foundation ADV annuity from Allianz can also provide you with a lifetime stream of income during retirement – regardless of how long you live. But it is also important to be cautious before you hand your money over to any insurance or financial company before you know how a product works.
Annuity and Retirement Income Planning Information that You Can Actually TrustIf you have never been to our website before, please allow us to officially welcome you here to Annuity Gator. Who exactly are we? (And why should you care?!) At Annuity Gator, we are a team of experienced financial and annuity professionals who specialize in providing in-depth, and unbiased, annuity reviews on the Internet. We have been doing this very well for quite a while now – far longer than our competitors have – even though there are now a number of “copycat” websites that are popping up all over the Internet. (Imitation is a form of flattery, isn’t it?!) It is our mission to provide in-depth information and reviews about annuities to consumers – as well as to financial professionals – so that they know exactly what they may (or may not!) be getting into when considering the purchase of an annuity. While annuities are becoming more popular, they can also be highly complex, so it helps to have someone to talk with who is adept in how annuities work, and who can pare down the massive amount of “fine print” into something that is more easily understood. That’s where Annuity Gator comes in! When looking for annuity information online, it is essential that you know who is trying to provide education on the products, and who is simply trying to sell you something…regardless of whether or not it is the right financial vehicle for you. Some companies admittedly “hate” annuities (although we aren’t sure how they can make such accusations before knowing an individual’s or a couple’s financial situation and objectives). On the other hand, it’s easy to be lulled into some of the other websites out there in cyberspace – especially when they make bold claims about annuities, like:
- Lowest fees
- High income
- Top-rated annuity carriers
- Income stream for life
The Allianz Retirement Foundation ADV Annuity at a Glance
|Product Name||Retirement Foundation ADV Annuity|
|Type of Product||Fixed Indexed Annuity|
|A.M. Best Rating||A+ (Superior)|
|Phone Number||(800) 950-5872|
Opening Thoughts on the Allianz Retirement Foundation ADV AnnuityAllianz has long been considered a strong and stable financial and insurance industry leader. Originally founded in 1896, Allianz has established a long track record of keeping its promises – which is why the company has amassed more than 12 million customers. Being a provider of both annuities and life insurance, the company has the experience and the ability to help its clients prepare for retirement, as well as for many of life’s financial uncertainties. As of early 2020, Allianz boasts a $119 billion portfolio – most of which consists of investment-grade securities. The company’s extensive, in-house capabilities allow it to monitor and control risk in real-time. Allianz has earned very respectable ratings from the insurer rating agencies, including a(n): – AA (Very Strong) from Standard & Poor’s – A1 from Moody’s Investors Service, and – A+ (Superior) from A.M. Best Over the past couple of decades, with so many employers eliminating their defined benefit pension plans, it has become the responsibility of individuals to make sure that they convert their savings over into an income stream – and that the income continues to last throughout the remainder of their lifetime. This can be a difficult task – especially in light of stock market volatility and a historically low-interest rate environment (which doesn’t look like it will end any time soon). But there is a potential solution. A fixed indexed annuity can provide individuals with a “personal pension” of sorts, that offers tax-advantaged growth, along with a lifetime income stream that will last as long as it is needed. This is what the Retirement Foundation ADV annuity from Allianz can do. But not all annuities – or even all fixed indexed annuities – are exactly the same. So, it bears taking the time to do some research in order to determine whether or not you should proceed with this (or any) annuity. Otherwise, you could find yourself trying to get out of a product, and in turn, being hit with a myriad of charges and fees.
Before we get into the in-depth details, we have some legal disclosures to present…This is an independent annuity product review. It is not a recommendation to purchase or to sell an annuity. Allianz has not endorsed this review in any way, nor do we receive any type of compensation for providing this review. This annuity review is meant solely to be an independent review at the request of our readers so that they may see our perspective when breaking down the positives and the negatives of this particular annuity. Prior to committing to the purchase of any type of insurance and/or investment vehicle, it is critical that you do your own due diligence, and that you also talk with a properly licensed professional if you have any questions that relate to your specific situation. All of the names, materials, and marks that have been used in compiling this annuity review are the property of their respective owners. Want to know more about how annuities really work? Click here to receive our updated annuity report.
How Allianz Describes the Retirement Foundation ADV AnnuityAccording to Allianz, the Retirement Foundation ADV annuity starts with the “typical” features of fixed indexed annuities. This includes the potential for index-linked growth, protection of principal (in any type of stock market environment), and tax-deferred gains. There are also a few added features here, such as a death benefit for beneficiaries, as well as the ability to receive guaranteed income for life – regardless of how long you may need it. With the Retirement Foundation ADV annuity, you have four external market indices to choose from, as well as a fixed-interest option. These include the:
- S&P 500 Index
- NASDAQ 100 Index
- Russell 2000 Index
- Bloomberg U.S. Dynamic Balance Index ll
How an Insurance or Financial Advisor Might “Pitch” this Annuity to ClientsWith people living so much longer today than ever before, having enough income in retirement has become a top concern for many retirees, as well as those who are approaching retirement. With that in mind, the guaranteed – and rising – income concept of the Retirement Foundation ADV annuity is most likely where an insurance or financial advisor would focus when presenting this product to clients or prospects. In addition, the tax-deferred growth of your money inside of the contract can also be a bonus – as there is no tax due on the gain until the time of withdrawal. It could also allow you an additional option for tax-advantaged accumulation, even if you have “maxed out” your annual contribution to accounts like a traditional IRA and/or employer-sponsored retirement plan. But even with all of these enticing benefits, there are some “tradeoffs” that you will need to make in order to attain them – starting with the fact that your upside growth can be limited by a “cap.” A cap is the maximum percentage of index change that the insurance company uses for a specified time period to determine how much interest is credited to your annuity. So, for instance, if the insurer caps the return at 5%, and the underlying index has a stellar performance during a given time period and it returns 10%, your annuity would be limited to a return of just 5%. The bottom line is that, if you’re given protection in a downward moving market, it is likely that you’ll give up a benefit somewhere else.
What About Charges and Fees on the Allianz Retirement Foundation ADV Annuity?There are a couple of areas to be mindful of when it comes to fixed indexed annuity fees – and in particular, the Retirement Foundation ADV annuity from Allianz. In this case, even though the Income Benefit rider is included in the contract, you will also be charged for it! In this case, the annual charge for the first year is 1.25% of the contract’s accumulation value. What!!? So, what Allianz is saying is that, if you contribute $100,000 to this annuity, this rider will cost you $1,250 bucks? Yep. Following the first contract year, you will again be charged annual for the Income Benefit rider. The amount can fluctuate, but Allianz states that “it [the charge] will never be greater than 1.25%” Well now, that’s a relief. In addition, the rider charge will continue for the life of the annuity contract – even after the lifetime income payments have begun. Like most other annuities, the Retirement Foundation ADV annuity from Allianz has a surrender charge if you access more than 10% of the contract’s value during a given time period. In this case, the surrender period runs for seven years, with the first year’s surrender charge of 6.5%. The amount gradually diminishes from there until Year 8.
Allianz Retirement Foundation ADV Annuity Surrender Charge Schedule
(Note that the withdrawal charge percentage will decrease 1/12 of 0.5% on each of the first twelve “monthiversaries”. On each subsequent monthiversary, the withdrawal charge will decrease by 1/12 of 1%. On day one of contract Year 8, it will be 0%).You can incur taxes on part or all of your withdrawal(s). Plus, if you are under the age of 59 ½ when/if you access these funds, you could also incur an additional 10% “early withdrawal” penalty from Uncle Sam. With that in mind, it is essential that you only use money that you won’t need in the near future for emergencies or other obligations. For more information on the Allianz Retirement Foundation ADV annuity’s charges and fees, you can go HERE. You can also check out the facts at a glance for this annuity HERE.
The Annuity Gator’s End Take on the Allianz Retirement Foundation ADV Fixed Index AnnuityWhere it works the best: Although this fixed indexed annuity offers some nice benefits in terms of accumulation, safety, and income, it may or may not be attractive to everyone. With that in mind, the Retirement Foundation ADV annuity will typically work the best for those who are seeking the following attributes:
- Safety of principal
- Tax-deferred growth
- The opportunity for additional, index-linked growth, which can provide a higher return than a regular fixed annuity
- Guaranteed income for life
- Will need access to their funds within the annuity’s surrender charge period.
- Do not want to eat into their returns with the annual income benefit rider charge (which could be as high as 1.25% per year).
- Do not intend to use the lifetime income feature.
In SummaryWhile there are many factors that need to be taken into consideration when you are buying an indexed annuity, one of the biggest concerns is making sure that the annuity is truly right for what you want – and need – it to do. With regard to the Retirement Foundation ADV annuity from Allianz, you can rest assured that you will have an income for life. But at the same time, depending on your other goals and needs, this product may still fall a bit short – and there quite frankly could very well be something else out there that is a better fit for you. If you have any additional questions on this, or other income-related products, we are here to help. We can also run side by side annuity comparisons of an annuity you are considering – or even one that you already have – in order to determine how various annuities might perform for you. So please feel free to contact us directly via our secure online contact form here.
Do You Have Any Additional Questions About this Annuity? Did You Happen to Notice Any Mistakes in this Review?We realize that this Allianz annuity review may have run a bit long. But quite frankly, we would much rather know that you have “too much” information on this annuity than to not have enough. So, if you found this information on the Allianz Retirement Foundation annuity to be beneficial, then please feel free to pass it on and to share it with other people who could also find value in it. (And, if you found it to be confusing, please also let us know that, too.) In addition, we are aware that information regarding annuities can, and often does, change. So, if you happened to notice anything in this review that should be updated or revised, let us know and we will be happy to make the necessary edits. Are there any other annuities that you would like to learn more about? If so, just give us a shout and let us know, and our team will get to working on them right away. Best, The Annuity Gator. P.S. If you would like to read more of our Allianz Life annuity reviews, here are some links to check out:
- Independent Review of the Allianz Life Index Advantage Annuity.
- Independent Review of the Allianz Life Allianz 360 Annuity.
- Independent Review of the Allianz Retirement Pro Variable Annuity.
- Independent Review of the Allianz Master Dex X Index Annuity.
- Independent Review of the Allianz Life Allianz Endurance Plus Annuity.
- Independent Review of the Allianz Master Dex 10 Annuity | April 2020 Update.
- Independent Review of the Allianz Vision Variable Annuity.
- Independent Review of the Allianz Life Core Income 7 Annuity.
- Independent Review Of The Allianz MasterDex X with Simple Income Rider Annuity.
- Independent, Objective Review of the Allianz 222 Annuity | Updated April 2020.