What will be covered in this review of the new Dynamic Accumulator annuity from F&G?In this annuity review, we will be going over the following details:
- Type of annuity
- How the annuity works
- The way return is calculated
- Where the annuity may fit within a portfolio
- Where this annuity might not be a good solution
Annuities can be complex. That’s where having an Annuity Investigator who loves math comes in. We make the complex, simple.If you’re heading towards retirement, you may have a goal of increasing your savings so that you have a larger “base” through which to generate a future income stream. As more employers do away with the defined benefit pension plan, it is up to retirees to formulate a plan for converting savings into a regular income that will last as long as they need it to. But this can be extremely difficult! Given the roller-coaster stock market, you certainly have the opportunity to generate significant returns. But just the opposite is also true because you not only risk the depletion of previous gains when the market tanks, but you can also end up saying goodbye to your principal. But there may be a solution for that. Over the past decade or so, the fixed indexed annuity has become a popular financial vehicle for helping investors and retirees generate a higher return than that of a CD, bond, or regular fixed annuity, while also ensuring that principal and prior gains remain untouched in a downward moving stock market. Although the fixed indexed annuity sounds like it can provide you with a win-win situation – and in many cases, it can – because there are many “moving parts” with these annuities, they are oftentimes presented incorrectly by insurance and financial advisors. That can be a problem! The good news is that you can discover all of the ins and outs of fixed indexed annuities like the newly introduced F&G Dynamic Accumulator right here in this review. At Annuity Gator, our mission is to provide objective, non-biased information about annuities – and we’ve reviewed hundreds of these products over the years. You can find information about how specific annuities work in the short – and long-term, as well as more in-depth detail regarding the “fine print,” so that you’re more aware of what you can and can’t expect.
Annuity and Retirement Income Planning Information You Can TrustIf this is your first visit to our website, then please allow us to officially welcome you here to Annuity Gator. Who exactly are we… and why should you care? We are a team of retirement income and annuity specialists who focus on offering in-depth, and unbiased, annuity reviews on the Internet. We have been at this for quite a while now – much longer than our competitors. (Although, there are now a number of “copycat” websites that are popping up all over the world wide web.) Our primary mission is – and always has been – to provide information about annuities for consumers so that they know exactly what they may (or may not!) be getting into before it is too late. You can find hundreds of annuity reviews in our annuity review database on our website. Annuities can be highly complex – especially the ones that have a lot of moving parts like fixed indexed annuities, or FIAs. So, it can really help if you have someone who is adept in how annuities work, and who can also pare down the massive amount of information about their inner workings into something that is more easily understood. That’s where the Annuity Gator comes in! When looking for annuity information online, it is essential that you know who is truly 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 lured into some of the other websites out there in cyberspace – especially when they make bold claims, such as:
- Low fees
- Highest income payouts
- Top-rated annuity carriers
- Guaranteed income stream for life
The F&G Dynamic Accumulator Annuity at a Glance
|F&G Annuities and Life
|Type of Product
|Fixed Index-Linked Annuity (FILA)
|A.M. Best Rating
Opening Thoughts on the F&G Dynamic Accumulator AnnuityF&G Life and Annuities was established in 1959, and is headquartered in Des Moines, Iowa. Throughout the years, the company has accumulated more than 700,000 clients who have protection from the unexpected as well as income security in retirement. The parent company of F&G is Fidelity National Financial, a Fortune 500 company, and a leading provider of title insurance and settlement services to the real estate and mortgage industry. F&G is considered to be strong and stable financially, and able to make good on its promises to policyholders, and it has earned the following ratings:
- A- from A.M. Best
- A- from S&P Global
- A- from Fitch
- Baa1 from Moody’s Investors Service
Before we get into the gritty details, here are some legal disclosures we need to provide…This is an independent product review, not a recommendation to buy or sell an annuity. F&G Life and Annuity has not endorsed this review in any way, nor do we receive any type of compensation for providing this review. This review is meant to be an independent review at the request of readers so that they may see our perspective when breaking down the positives and negatives of this particular annuity. Prior to purchasing any type of investment or insurance 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 circumstances. All names, marks, and materials that were used for this review are the property of their respective owners.
How F&G Life and Annuity Describes the Dynamic Accumulator AnnuityAs an annuity built upon a fixed indexed annuity chassis, the F&G Dynamic Accumulator annuity can help you to grow and protect your retirement nest egg. In its most basic sense, a fixed indexed annuity gives you protection from market losses and growth potential, based on the performance of an underlying market index – such as the S&P 500 – but without the risk of participating in the market itself. With a fixed indexed annuity, the return is based in large part on the performance of one or more indexed. So, when the tracked index(es) generates a positive return in a given annuity contract year, the account is credited with a gain – oftentimes up to a preset upper limit. In return for the limited upside, though, if the underlying index(es) incurs a loss in a contract year, there is no loss in the value of the account. Rather, it is still credited with a guaranteed minimum “floor” rate (which in today’s market, is typically somewhere between 0% and 2%). This growth is tax-deferred, so there is no tax on the gains each year. This, in turn, can allow the gains in the account to snowball. Taxes are then owed when the gains are withdrawn, either as an ongoing income stream or as a lump sum. The F&G Dynamic Accumulator annuity is actually an offshoot of the basic fixed indexed annuity. In this case, for instance, it provides greater downside protection in the case of a market downturn. This annuity is actually considered a registered index-linked annuity, or RILA, which offers 100% principal protection against market decline. However, similar to a regular registered index-linked annuity (RILA), the Dynamic Accumulator can also provide you with greater potential, as well as more flexibility in controlling the level of risk that is taken on. For example, with the Dynamic Accumulator annuity, you can change the risk level on an annual basis by “dialing back” to a 0% guaranteed minimum floor, or alternatively increasing the opportunity for upside potential (but then also taking on a certain amount of risk if the index generates a negative return). As with other FIA annuities, the F&G Dynamic Accumulator annuity includes a few more “bells and whistles,” such as the ability to convert the account value into an ongoing stream of income in retirement. For more information on the F&G Dynamic Accumulator, as well as on the study that was conducted by F&G Life and Annuity that helped the insurer come up with this specific annuity offering, you can go here.
How an Advisor May “Pitch” the Dynamic Accumulator Annuity from F&GMost financial advisors truly want to help their clients meet both short – and long-term financial goals. With so many of the Baby Boomers reaching the retirement finish line, guarantees and protection of principal have become much more important. This being the case, it is likely that an insurance or financial advisor would highlight the opportunity for growth, as well as the protection aspect of the Dynamic Accumulator annuity from F&G. It is important to note, though, that not all insurance and financial advisors are up to speed on how fixed indexed annuities work. So, if you have been presented with the Dynamic Accumulator annuity – or for that matter, with any annuity – and the advisor seems a bit unsure, feel free to check out our website or contact us directly and we can help you get all of the information that you need.
Fees on the F&G Life and Annuity Dynamic AccumulatorAs with most insurance-related products, there are some fees you should be aware of when it comes to the Dynamic Accumulator annuity. For instance, if you withdraw more than 10% of the account value in any year during the surrender period, you will be dinged with a penalty. (This is in addition to any tax that you may owe on the portion of the withdrawal that is considered gain.) Plus, if you make such withdrawal(s) before you have turned age 59 ½, you could also be responsible for paying an additional 10% IRS “early withdrawal” penalty. Therefore, make sure that the money you put into this (or any) annuity won’t be needed in the near future for emergencies or other pressing financial needs. For more details about the Dynamic Accumulator annuity, you can check out this informational piece here.
The Annuity Gator’s End Take on the Dynamic Accumulator Annuity from F&G LifeWhere this annuity may work best: Although this 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
- Flexibility for obtaining more growth or less risk
- Guaranteed income for life – for an individual or for two spouses
- Will need access to more than just 10% of their funds within the annuity’s surrender charge period
- Are seeking unlimited (i.e., uncapped) growth opportunity
- 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 in the short- and long-term time horizon. With regard to the Dynamic Accumulator annuity from F&G Life and Annuity, you can rest assured that you (and your spouse, if applicable) will be able to keep your principal (and your prior gains) safe, while at the same time still growing your asset base. However, at the same time, depending on your other financial and retirement goals and needs, this product may still fall short – and there could be something else out there that is a better fit for you. If you have any additional questions on the F&G Dynamic Accumulator annuity, and/or other income-related products, Annuity Gator is 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? Did You Happen to Notice Any Mistakes on this Review?We realize that this F&G annuity review has run a bit long. Yet, 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. With that in mind, 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 working on them right away. Be sure to check back often for any of the new reviews that are added to our massive annuity review database. 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 F&G Next Generation Accumulation Power Accumulator Annuity.
- Independent Review of Fidelity and Guaranty Life Insurance Company.
- Independent Review of the F&G Power Accumulator Annuity.
- Independent Review of the Fidelity and Guaranty Life FG Guarantee Platinum 5 Annuity.
- Independent Review of the Fidelity & Guaranty FG Guarantee Platinum 3 MYGA Annuity.
- Independent Review of the Fidelity & Guaranty Life AccumulatorPlus 10 Annuity.