What Will Be Covered in this Annuity Review?In this review, we will be discussing the following details on the Fidelity & Guaranty Life Accumulator Plus 10 fixed indexed annuity:
- Product type
- Current rates
- Realistic long-term return expectations
- How this annuity is best used
- How it is most poorly used
Annuities can be complex. That’s where having an Annuity Investigator who loves math comes in. We make the complex, simple.
Purchasing an annuity like the F&G Next Generation Power Accumulator fixed indexed annuity is a big decision. These financial vehicles – provided that they are purchased properly – can definitely help to ensure that you’ll have a guaranteed income for the remainder of your lifetime, regardless of how long you may need it. Unlike several decades ago, many people are living much longer these days. So, knowing that you have ongoing income in retirement can be a big relief. Guaranteed lifetime income could also help you to remain stress-free, happy and healthy! However, even though annuities can offer many benefits, there can also be some drawbacks to consider with regard to the products themselves, as well as the way in which they are sold by insurance and financial professionals. On top of that, annuities are pretty confusing products. They contain a lot of “fine print” – in particular fixed index annuities because they contain a lot of moving parts. So, unless you read all of the product information very carefully, an annuity may not necessarily perform the way that you anticipated it to. This is where the Annuity Gator can help!
Annuity and Retirement Income Planning Information You Can TrustIf this the first time you have visited our website, please allow us to personally welcome you here to Annuity Gator. We are a team of experienced annuity and retirement income specialists who focus on providing comprehensive yet unbiased annuity reviews online. We have been doing this for quite some time – and much longer than our competitors have. Because of this, we have come to be known as a highly trusted source of annuity information online. Over the past several years or so, however, many “copycat” websites have started to pop up on the Internet. So, while that can be somewhat confusing for consumers, we take it as somewhat of a compliment. After all, imitation is the highest form of flattery! If you’ve spent any amount of time online researching annuities, then you have more than likely come across some conflicting information about these products. This, however, is not all that surprising, because there are many varied opinions about annuities. But if you’re looking for more in-depth information about the F&G Next Generation Accumulation Power Accumulator Annuity, you are in the right place. It is our mission here at Annuity Gator to provide in-depth details to consumers about annuities so that they know what they may – or may not – be getting into with one of these financial products. For instance, when researching 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. It’s easy to be lulled into some of the other websites out there in cyberspace – especially when they make bold claims, like:
- Lowest fees
- High income
- Top-rated annuity carriers
- Income stream for life
F&G Next Generation Accumulation Power Accumulator Annuity at a Glance
|Product Name||Power Accumulator|
|Issuer||F&G (Fidelity & Guaranty) Annuities & Life|
|Type of Product||Fixed Index Annuities|
|A.M. Best Rating||A-|
|Phone Number||(345) 947-5614|
Opening Thoughts on the F&G Next Generation Accumulation Power Accumulator AnnuityFidelity & Guaranty Life (F&G) has been in the business of offering life insurance and annuities for more than six decades. The company offers its products through the growing independent agent market. F&G’s parent company, USF&G, launched Fidelity and Guaranty Life Insurance Company in 1959, with a mission of providing life coverage and annuities through the property and casualty insurance market. In 2001, a UK-based company, Old Mutual, acquired Fidelity & Guarantee Life Insurance Company in order to expand into the U.S. market. Since that time, F&G has added to its annuity product line, and today offers fixed and fixed indexed products. Currently, F&G has approximately 700,000 policyholders. The company is headquartered in Des Moines, Iowa, and as a publicly-traded company, its stock is listed on the New York Stock Exchange and trades under the symbol FG. Over the past several years, in large part due to the highly volatile stock market, more people have been taking a closer look at fixed indexed annuities. This is because, in addition to keeping principal safe (in any market condition), these financial vehicles can also provide you with the opportunity for ample growth, as well as a set amount of income that could last you for the remainder of your lifetime. Yet, even though this might sound like a win-win-win situation, the reality is that if something sounds like it may be too good to be true, then it typically is – so you should ideally get as much in-depth detail as possible if you are considering committing to it for the long term.
Before we get into the gritty details, here are some necessary legal disclosures…This is an independent annuity product review. It is not a recommendation to purchase or to sell an annuity. Fidelity & Guaranty Life 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. Before purchasing any type of insurance and/or investment product, it is important that you do your own due diligence, and that you consult a properly licensed professional if you should have any specific questions that relate to your individual situation. All of the names, marks, and materials that were used for this annuity review are the property of their respective owners. For more information on how to compare annuities in order to determine which one may be the best for you and your financial circumstances, click here to obtain our free annuity report.
How Fidelity & Guaranty Life Describes the Next Generation Accumulation Power Accumulator AnnuityF&G describes the Power Accumulator as a flexible premium deferred fixed indexed annuity that provides the opportunity for investors to attain market-linked growth, but without any downside market risk. There are two rate-lock options with the Power Accumulator annuity series – the F&G Power Accumulator 7 and the F&G Power Accumulator 10. Both of these annuities were built in partnership with iShares by BlackRock. Both of these are considered long-term annuities, as the surrender period corresponds with the rate lock period. (In other words, depending on the annuity, the surrender period will last for 7 or 10 years). Although you are allowed to withdraw up to 10% of the contract value each year penalty-free. In addition, when ready, investors can convert the annuity into an ongoing retirement income stream to help meet expenses in the future. This annuity also allows you to leave a legacy through a death benefit. You can choose from several different interest crediting options for earning interest. These include a fixed account option (that has a guaranteed rate of no less than 1%), as well as additional index-linked options that are benchmarked to ETFs (exchange-traded funds). Several of the options that are benchmarked to ETFs include:
- iShares Core S&P 500
- iShares MSCI EAFE
- iShares U.S. Real Estate
- iShares Gold Trust
How an Insurance or Financial Advisor Might “Pitch” this AnnuityBecause of market volatility many people are looking for safer growth or protected growth. This leads many to research and consider an index annuity. With that in mind, the protected growth concept of the F&G Power Accumulator fixed indexed annuity is most likely where insurance or financial advisor would focus on 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 – and it could even allow for an additional option for tax-advantaged accumulation, even if you have “maxed out” other alternatives like an IRA and/or employer-sponsored retirement plan. But even with all of these awesome features, you really need to be careful, as there are some “tradeoffs” you may need to make with this product. For instance, even though you have the ability to obtain a positive return based on the performance of an underlying index (or indexes), the upward potential is capped. For instance, each of the index crediting options is subject to participation rates and/or spreads. In this case, a participation rate means that your annuity is only “participating” in a portion of the gain in the underlying index(es). Here’s an example: If the participation rate is 80%, and the underlying index returns 10% for a given period, then your annuity will only be credited with 80% of that 10%, or 8%. This can limit the amount of growth you actually retain – end even more so in years where the index has a stellar double-digit performance. Also, with some fixed index annuities, the indexed interest amount will be determined by subtracting a certain percentage from any gain that the underlying index achieves within a certain period of time. For instance, if the annuity has a spread of 4%, and the underlying index returns 9% for a given contract year, the annuity will be credited with 5% indexed interest for that period. More of the in-depth details – including the benefit restrictions and tradeoffs – on the Power Accumulator 7 Annuity from F&G can be found here and for the Power Accumulator 10 Annuity from F&G here.
What About the Fees on the F&G Next Generation Accumulation Power Accumulator Annuity?While fixed and fixed indexed annuities don’t typically reduce your up-front contribution with sales charges, that doesn’t mean that you will never incur any fees. In fact, if you withdraw more than 10% of your contract’s value during the surrender period, you will incur a withdrawal, or surrender, charge. The surrender charge period corresponds with the rate lock period. So, if you have the Power Accumulator 7 annuity, it will run for 7 years, and likewise with the Power Accumulator 10 Annuity.
Surrender Charge Percentages in Power Accumulator 10 Annuity for Withdrawals in Year 1, or Withdrawals of More than 10% in Years 2 through 10
|All other states||12%||11%||10%||9%||8%||7%||6%||5%||4%||3%||0%|
|AK, AL, CA, DE, FL, MA, MN, MS, NJ, NV, OH, OK, OR, PA, SC, TX, UT, WA||9%||9%||8%||7%||6%||5%||4%||3%||2%||1%||0%|
Surrender Charges Percentages in Power Accumulator 7 Annuity for Withdrawals in Year 1, or Withdrawals of More than 10% in Years 2 through 7
The Annuity Gator’s End Take on the F&G Next Generation Accumulation Annuity – Power AccumulatorWhere it works the best: Although this fixed indexed annuity offers many nice benefits, it will typically work the best for those who are seeking the following attributes:
- Safety of principal
- The opportunity for additional, index-linked growth, which can provide a higher return than a regular fixed annuity
- Will need access to their funds within the annuity’s 7-year or 10-year (depending on the option you choose) surrender charge period
- 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 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 Power Accumulator fixed indexed annuity from Fidelity and Guaranty Life, you can rest assured that your funds are protected from market losses and that you have the ability to earn interest if the market index goes up. 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 in order to determine how various annuities might perform. 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 on this Annuity Review? We realize that this annuity review may have run a bit long. But quite frankly, we would much rather that you have “too much” information on this product than to not have enough. So, if you found this annuity review to be beneficial, 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. 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 Fidelity & Guaranty annuity reviews here are some links to check out:
- Independent Review of the Fidelity & Guaranty FG Guarantee Platinum 5 Annuity
- Independent Review of the Fidelity & Guaranty Life AccumulatorPlus 10 Annuity