What’s Covered in this American Equity Choice 10 Fixed Index Annuity Review?In today’s review, we’ll be covering the following information on the American Equity Choice 10 Fixed Index 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.
The Choice 10 Fixed Index Annuity from American Equity is an annuity that offers a wide array of benefits, including the opportunity for growth, and the protection of principal – even if the market suffers a substantially negative period – which for many people, could seem like the best of both worlds. This product also offers some of the more common features that you’ll see on this type of annuity, such as the tax-deferred growth of the funds that are inside of the account, liquidity (albeit, limited at first), and guaranteed income in the future. It offers a choice of indexing options, that offer growth potential, as well as a fixed interest account.
Annuity and Retirement Income Planning Education That You Can TrustIf you have never visited our website before, we would first like to officially welcome you to AnnuityGator.com. Here, you will find that we are a team of experienced insurance and financial professionals who focus on offering unbiased reviews of annuities. For anyone who is looking for more annuity information – and not just the positive information that you’ll typically find on annuity sales websites – then you’ve definitely come to the right place. There are any number of reasons why you might be looking for more details on the American Equity Choice 10 annuity, and the good news is that you will find what you’re looking for here. It is possible that you’ve already been presented this annuity by your financial advisor, or you may even have recently attended an annuity seminar where the presenter offered you a free lunch or dinner in return for pitching you this or a similar product. While you may have been impressed with what you’ve heard so far about the Choice 10 annuity, though, the reality is that there is no such thing as a “free lunch.” While searching for information on various other annuity websites, you may also have found that you were lured in by claims stating that these sites offer the highest annuity payouts, the lowest fees, and other enticing information. Unfortunately, most of this hype is marketed so that visitors to these websites will part with their contact information. What you will find here at AnnuityGator.com, however, is different. We’ve been offering in-depth annuity reviews for many years now – and because of that, we have become a highly trusted source of annuity information. Since we’ve been offering this service, though, numerous copycat websites have come along. Based on our experience, we’ve actually discovered that none of the benefits of an annuity really matter until you first understand what your primary reason is for buying it. In addition, even if you are seeking a nice rate of return, most fixed index annuities will not be able to produce 7 to 8% – and definitely not consistent over time. Want to find out how annuities really work – and how they may, or may not, work for you? Then feel free to instantly download our 2017 Annuity Buyer’s Guide. If you stick around our site for just a while and go through this review, you will find that the information is objective and non-biased. So, if you’re ready to find out how the American Equity Choice 10 fixed index annuity really works, let’s go ahead and get started. [desktoponly]
American Equity Choice 10 Fixed Index Annuity – The Basics
|Product Name||Choice 10|
|Type of Product||Fixed Index Annuity|
|Issuer||American Equity Investment Holding Company|
|A.M. Best Rating||A- (Excellent)|
Opening Thoughts on the Choice 10 AnnuityAmerican Equity has been in the business of offering annuities for more than 20 years. Today, this company is ranked as the number three all-time fixed index annuity provider, with more than $43 billion in assets, and high ratings from both Standard & Poor’s and A.M. Best. Over the past several years, fixed index annuities have become quite popular, as a way to get a nice potential return, along with the safety of principal. Given the constant volatility of the market, these annuities have led many investors to feel that they are keeping their money safe, while at the same time, building a nice retirement income stream for the future. This annuity offers five different interest crediting methods, including an annual point-to-point with cap, annual point-to-point with participation rate, monthly point-to-point with cap, volatility control, and a fixed option. Given that today, people are living longer than ever before in history, the thought of running out of income in retirement is a very viable concern. Because of that, many insurance carriers that offer fixed index annuities have added riders to their products, which can provide annuity holders with an income that they literally can’t outlive. In the case of the American Equity Choice 10 annuity, there are several different income payout options available. Plus, because the unexpected can and sometimes does occur, in the event of death, a named beneficiary can receive the entire contract value with this annuity. The Choice 10 fixed index annuity also offers some additional riders that can increase the amount of liquidity in the event of confinement in a nursing home, or if the annuitant is diagnosed with a qualifying terminal illness. While all of these benefits may sound enticing, though, it can still be difficult to know for sure which – if any – annuity will be right for you. So, if you still have questions or concerns, and you want some first-hand and unbiased information, please feel free to reach out to us directly via our secure contact form here.
Before we get into the gritty details, here are some legal disclosures…This is an independent product review, not a recommendation to buy or sell an annuity. American Equity has not endorsed this review in any way nor do I receive any compensation for this review. This review is meant to be an independent review at the request of readers so they could see my perspective when breaking down the positives and negatives of this particular model annuity. Before purchasing any investment product be sure to do your own due diligence and consult a properly licensed professional should you have specific questions as they relate to your individual circumstances. All names, marks, and materials used for this review are the property of their respective owners. For additional information on how to compare fixed indexed annuities so that you can decide which may be the best one for you, click here in order to obtain our free annuity report.
How American Equity Describes The Choice 10 Fixed Index AnnuityAccording to American Equity’s Choice 10 literature, this product is a fixed index annuity that offers both protection and income – guaranteed. The top benefits that this annuity includes:
- Principal Protection (even in down market years)
- Guaranteed Income
- Tax-Deferred Growth
- Possible Avoidance of Probate
How a Financial Advisor Might Pitch this AnnuityToday, many of the insurance and financial advisors who offer fixed index annuities will pitch the fact that you have the opportunity for higher return – especially as it relates to regular fixed annuities – as well as the ability to keep your principal safe when the market tanks. When an advisor is showing you this – or any – annuity, though, be sure that you’re getting the whole story – and that you have a good understanding of just exactly what you’ll be getting should you decide to sign on the dotted line. Over the years, there have been numerous enhancements made to annuities. This is particularly the case when it comes to fixed index annuities – which are sometimes referred to as “hybrid” annuities. This name can conjure up numerous images – but one that seems to be consistent is confusion. This is true for both consumers and financial advisors, as the bells and whistles that are offered can seem a bit overwhelming. The good news is, though, that the term hybrid annuity really just refers to numerous features that are all rolled into one single annuity product. In this case, the American Equity Choice 10 annuity does allow you to pick and choose among various features. But the question is, do you really need these features – and even more so, will these features perform in the manner that they were presented? For instance, there are many financial advisors who state that the fixed index annuities they offer will return between 7 and 8%. This, however, is not necessarily the case in reality. Most advisors are not intentionally misleading their clients. Rather, fixed index annuities can be difficult to understand.
American Equity Choice 10 Annuity FeesJust like with most any insurance and financial product, the American Equity Choice 10 fixed index annuity will have some charges and fees that are associated with it. For starters, there is typically an up-front sales commission that is paid out to the agent who sells you this annuity. Also, if you want to take out more than 10% of your contract value in any given year within the first decade that you own it, you will incur a surrender charge. In fact, the American Equity Choice 10 has one of the longer surrender charge periods in the industry. [desktoponly]
The Annuity Gator’s End Take on the American Equity Choice 10 Fixed Index AnnuityWhere it works best: The bottom line on the Choice 10 is that this annuity may work the best for people who are looking for the following features:
- Safety of principal
- The opportunity for index-linked growth
- Guaranteed lifetime income in retirement
- Access to most or all of your money within the first eleven years
- You do not intend to use the lifetime income feature of the annuity
Thanks for the write-up on this product. Our firm does in-depth independent research on any annuity or investment we offer to potential clients. This is one of the few annuity offerings that meets our criteria.
Our criteria includes fees (there are no ongoing management fees with this annuity unless an income rider is selected), safety of principal, opportunity for growth, crediting strategies, rate renewal history and company financials.
The most simple to use and explain is the annual point-to-point participation rate (currently at 45% of S&P 500). The month to month with cap is also an option. Keeping it simple seems to work very well and we are seeing decent returns over multiple time periods out 10 years.
Personally, I don’t care for income riders. The insurance company simply gives back client money, often for 15 years or more, before the contract owner receives any benefit. With the Choice 10’s accumulation potential, it seems to me that the contract owner has more control over the distributions while maintaining a reasonable growth potential.
I am curious to hear how you would evaluate this type of strategy.
Hi Anthony – Thank you for checking out out annuity reviews. We would be happy to provide you with some additional feedback and answer any more questions that you may have regarding the American Equity Choice 10 Fixed Index Annuity. Please feel free to reach out to us directly at (888) 440-2468, or just reply to this email (or go to: https://www.annuitygator.com/contact/) with a good number to reach you and a time when you’d like for us to chat. (Usually a short, 5-minute phone call is easier than going back and forth via email.) Thanks, we look forward to hearing from you. Best. – Annuity Gator Team