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Independent Review of the American Equity Investment Life AssetShield Fixed Index Annuity

What Will We Cover in this Annuity Review?

In this annuity review, we will be covering the following details regarding the American Equity Investment Life AssetShield Fixed Index Annuity:
  • Product typeIndependent Review of the American Equity 7 MYGA Annuity
  • Fees
  • 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.

If you are currently in the process of considering an annuity, then it is important to know that these products can be a logical choice if you are seeking a lifetime income in retirement, along with other key benefits. But before you dive head first into the purchase of an annuity, it is essential that you have a good understanding of just exactly what these products do – and don’t do – and that you also know how the type of annuity that you’re considering will work. Because fixed index annuities can have so many “moving parts” – and insurers continue to add “new and improved” features to these annuities all the time – there are even many financial and insurance professionals who may not be up to speed on how these products work. So, it can behoove you to do just a bit of research before you commit what could be a large chunk of your retirement savings. As an example, with the American Equity Investment Life’s AssetShield Fixed Indexed Annuity, you have the opportunity to earn an index-linked return, while at the same time, ensuring that your principal is safe – no matter what occurs in the stock market. Here, similar to with other annuities, you can also choose from several different income options, which includes one that pays you an income stream for the remainder of your life, regardless of how long that may be. Throughout the past decade or so, fixed indexed annuities have actually become much more popular – particularly with those who are approaching retirement. One reason for this is their “best of all worlds” offerings – such as the opportunity for growth, protection of principal, and guaranteed income down the road. An annuity is considered to be a very long term commitment. And, while these products may offer a number of enticing features, you need to make sure that these features are right for you and your specific goals. That’s where we come in!

Annuity and Retirement Income Planning Advice You Can Trust

If you have not visited our website before, then please allow us to personally welcome you to We’re a team of annuity professionals who focus on offering both comprehensive and unbiased annuity reviews. We have been doing this for quite some time now – much longer than our competitors have – and because of that, we have come to be known as a highly trusted source of annuity information online. Over the past several years, though, there have been a number of “copycat” websites that have sprung up all over the place online. But, while these sites may at first seem informative, the reality is that many of them are only reiterating the details that you can find here. They are also often times just simply vying to get your contact information so that they can inundate you with a plethora of emails and phone calls…something that can become quite bothersome for you! In addition, if you have been seeking information on fixed indexed annuities via the Internet, then it is likely that you have run across a lot of conflicting details about these products. This is not really surprising, though, because there are many annuities available today, and just about everyone seems to have a differing opinion about them. It is also possible that you have recently attended a seminar about annuities. There, in return for a complimentary dinner or lunch, the presenter may have gone into detail about the AssetShield fixed index annuity, or some other similar financial product. After this seminar, you may have made an appointment to follow up with the presenter (or with another financial advisor) in order to purchase this annuity for yourself. It may even be that seminar that was the ultimately reason you’ve landed here today on our website, in search of more information. In any case, if you are looking for more in-depth information regarding the AssetShield annuity from American Equity Investment Life Insurance Company, then you’ve definitely landed in the right place. In fact, we dare say that right here on this website is the only place where you will find the good, the bad, and the downright ugly about this annuity – but having all of these details on hand is the only way to make a well-informed determination as to whether or not it is the best option for you. So, if you are ready to start the review, let’s go ahead and dive in!

American Equity Investment Life Insurance Company’s AssetShield Annuity at a Glance

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Opening Thoughts on the American Equity Investment Life AssetShield FIA Through its headquarters in Des Moines, Iowa, American Equity Investment Life Holding Company and its subsidiaries specialize in the sale of fixed index and fixed rate annuities. In fact, American Equity Life Insurance Company’s mission is “to become the premier insurance company specializing in retirement savings an income products.” Its relatively new AssetShield fixed index annuity can definitely help to accomplish that goal. Since 1995, the company has provided quality wealth accumulation and protection products, as well as retirement income generating vehicles. Today, the company has assets in excess of $51 billion. American Equity is licensed to offer its products in all 50 U.S. states, as well as the District of Columbia. The company is considered to be strong and stable financially, and has earned an A- (Excellent) rating from A.M. Best (as of June 2018) and an A- (Strong) from Standard & Poor’s. Over the past several years, fixed index annuities have become much more sought after by consumers as a way to obtain a guaranteed income for life, as well as an opportunity to keep principal safe regardless of what the market does. But, even though this may all sound enticing, the truth is that when something sounds too good to be true, then you probably need a bit more information in order to discover the whole story. This is particularly the case if your decision about an annuity could ultimately result in you committing a large chunk of your hard-earned retirement savings.

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. American Equity Investment Life Insurance Company 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. For additional information on how to compare annuities so that you can decide which may be the best one for you, in order to obtain our free annuity report.

How American Equity Describes the AssetShield Fixed Index Annuity

American Equity Life describes the AssetShield fixed index annuity as a financial vehicle that offers added growth opportunities to take retirement dollars to new heights while protecting assets in order to help keep increases secure. The AssetShield offers multiple allocation strategies, along with the opportunity for strong growth, and increased liquidity options for additional access to – and control of – money when it is needed. This annuity has fixed rate terms available of five, seven, and ten years, and it also provides the opportunity for multiple index crediting allocations – all backed by S&P indices – as well as access features for increased asset control. In addition to the more “traditional” fixed index annuity benefits, such as principal protection, tax-deferred growth potential, and free (albeit limited) withdrawal options, the AssetShield annuity from American Equity offers the following key features:
  • Additional potential for growth. This includes the American Equity exclusive monthly point to point with replacement rate crediting strategy (more on this later in the review) as well as multiple other crediting strategies for added diversification.
  • Increased access security. With the optional Rate Integrity Rider, you can elect to surrender the AssetShield annuity penalty-free, provided that the contract renews either at or below rates that were offered with you initially purchased the annuity.With the AssetShield, you can opt for the fixed interest strategy, whereby a fixed interest rate is set at the time of issue, and is guaranteed for the contract year. (This rate can, however, change each year thereafter).
There is also the option for a fixed index strategy. Here, the growth is linked to the performance of an underlying index – yet, as with other fixed index annuities (FIAs), your funds are not invested directly in the stock or bond market. The AssetShield offers a number of different crediting strategy options, which can help to essentially “customize” the annuity, based on individual goals and objectives. These include the following:
  • Monthly Point to Point – Interest credits are determined using the changes in the underlying index from “point to point” in a contract year, and are then credited based on changes in price.
  • Annual Point to Point – On each of the contract anniversaries, the index price will be compared to the prior year’s price, and then interest is credited based on changes in the price.
  • Two-Year Point to Point – On the contract anniversary at the end of a two year period, the index will be compared to the beginning of the term.
As it pertains to the indexes that are tracked, there are currently two – these include the S&P 500, and the S&P 500 Dividend Aristocrats Daily Risk Control 5% Excess Return Index. Another of the nice features that can be found with fixed index annuities is the locked in growth. The AssetShield annuity allows the opportunity for you to lock in any of the interest that has been previously credited to the account – without the risk of losing money when an index decreases. Free withdrawals are allowed during the annuity’s surrender period – but only up to 10% of the contract value. Otherwise, a surrender charge will be incurred. The annuity has some added bells and whistles, such as a death benefit, a nursing care rider and a terminal illness rider. Also, the Rate Integrity Rider may be chosen (for an additional charge). This rider allows for a waiver of surrender charges upon termination of the annuity contract. During this waiver election period, American Equity Investment Life will waive surrender charges is the company declares a cap or participation rate for any crediting strategy included in the Rate Integrity Rider that is either less than or equal to the surrender charge waiver rate. (The surrender charge waiver rate for each of the crediting strategies is determined at the date of purchase). For more information – and to have access to any updated details on the AssetShiled as they become available – go HERE. To check out more specific features of the AssetShield 5, 7, or 10 year fixed rate terms, the product brochures can be found here: American Equity Life has also created a short video that explains how each of the fixed rate terms work.

How an Advisor Might Pitch this Annuity to Potential Purchasers

Because the AssetShield is a fixed indexed annuity, it is likely that an insurance or financial advisor may “pitch” this product by keying in on the ability to get an index-linked return, while at the same time, keeping your principal safe – regardless of what happens in the market. In addition, you can also receive lifetime income from this product – which can help to alleviate the worry about running out of money in retirement. So, what could be so bad about that? Actually, there are several things – primarily in the “tradeoffs” that you need to make in order to receive the benefits of this annuity. So, before you get out your checkbook and jump into a long-term committed relationship with the AssetShield annuity, there are some important details that you need to know. For instance, as with many other fixed indexed annuities, this one imposes a “cap” on some of its crediting methods. This means that, even if the underlying index that your plan is tracking has a stellar performance, the return that you actually receive will be “capped” at a certain percentage of that. As an example, let’s say that the you choose a crediting method with the American Equity AssetShield annuity that has return capped at 5%. If the underlying index actually attains an 8% return for a given time period, you’re stuck with only returning 5%. So, when you really think about it, the cap that is imposed could cause you to lose out on some really good performance from your underlying index.

What About Fees on the American Equity Life AssetShield Annuity?

Another item that you need to be mindful of before you buy an annuity is the fees. One of the biggest of these could be a surrender charge incurred if you withdraw more than 10% of the contract’s value over the first ten years of owning the annuity. The length of the surrender charge is based on the fixed rate option that is chosen and it correlates with these. For instance, if you chose the 5-year fixed rate option, then the surrender charge would last for five years, and so on. [table “482” not found /]
An additional consideration to be mindful of is that, if you make a withdrawal before you have turned age 59 1/2, then you might also be liable for an additional 10% IRS “early withdrawal” penalty. With that in mind, be sure that you know an annuity is a long-term financial commitment, and that you do not use money that you may need for an emergency in the future.

The Annuity Gator’s End Take on the American Equity Investment Life Insurance Company’s AssetShield Fixed Index Annuity

Where it works best: This particular annuity will usually work the best for those who are looking for:
  • The opportunity to obtain a higher rate of growth than that of a regular fixed annuity
  • Safety of principal
  • A long-term commitment to the product
  • Lifetime income
Where it works worst: On the other hand, this annuity may not fare so well for those who:
  • Want to fully participate in market gains
  • Want or need to access their funds penalty-free within the first five to ten years (depending on the fixed rate option chosen) of purchasing the annuity
  • Do not intend to use the guaranteed lifetime income feature

In Summary

There are many factors that should ideally be taken into consideration if you are thinking about purchasing an annuity. These should include – but are not limited to – how the annuity can produce a return, how safe your money will be, how the income will pay out, and whether or not there are any other optional features that may be added to the annuity (as well as any added costs). If you are in fact considering the purchase of a fixed index annuity, then you can be assured that your principal will be safe, regardless of what occurs in the stock market, or even the economy as a whole. These annuities will also provide you with an opportunity to grow your retirement funds, and to receive a guaranteed income in the future for as long as you need it. But there can still be some questions left unanswered – and, the only way to really know if this particular annuity could be right for you is to test it with an annuity calculator. If this is something you would like to pursue, we can offer you a personalized look at how the AssetShield from American Equity Investment Life Insurance Company might perform – based on your specific parameters. Then, once we have run these numbers, we’ll provide you with a detailed spreadsheet at no charge to you.

Do You Still Have Any Additional Questions? Did You Notice Any Mistakes in this Review?

While we realize that this annuity review was a bit on the long side, our feeling is that we would rather provide you with a lot of details than with not enough. This is really the only way to get the full picture. Therefore, if you did find that this annuity review was beneficial to you, then please feel free to forward it on and to share it with anyone else that you think may benefit from it as well. In addition, we also know that details about annuities – and other financial products, too – can and do change somewhat quickly. With that in mind, if you happened to notice anything in this review that needs to be corrected and / or updated, please let us know that as well, and we will get on the revisions right away. Are there any other annuities that you would like to see information about? No problem! If you would like to see reviews on any other annuity (or annuities), our team of annuity “geeks” will get on the ball and get them on our website. Just simply click here to let us know which product (or products) you are interested in seeing. And, be sure to check back soon. Best, The Annuity Gator. P.S If you would like to read more of our American Equity annuity reviews here are some links to check out: Independent Review of the American Equity Investment Life AssetShield Fixed Index Annuity

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