What’s Covered In This Review
In this review, I will go over the following information on the Pacific Life Pacific Frontiers II, 1 Year Guarantee fixed annuity:
- Product Type
Fees- Current Rates
- Realistic long term investment expectations
- How it is 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.
You might notice at first that – if you’ve been seeking information on annuities – there is a lot of information available. However, much of the information that can be found on the Internet can also be highly contradictory.
But, if you’ve been hoping to find an annuity that will allow you to keep your principal safe, as well as provide you with a consistent income in the future, then the Pacific Life Pacific Frontiers II 1 Year Guarantee fixed annuity may be a good option for you.
Like many other fixed annuities, this one will not keep you up at night, worried about losing your hard earned savings if the stock market takes a tumble. Plus, if you choose the lifetime income option, you won’t have to worry about the income stream running out for the remainder of your lifetime – no matter how long that may be.
But, before you dart out and sign the paperwork to commit to this annuity, it is absolutely essential that you know all of the pertinent information – which includes not just the rosy good stuff, but also the bad and the ugly. That is really the only way to make a well-informed decision.
That is because, even though fixed annuities can offer you some comforting guarantees, these can come at a price – primarily by way of low returns. So with this in mind, you may not even be able to keep your money on par with inflation. This, in turn, can have a negative impact on your purchasing power going forward.
This annuity review is here to assist you with a better understanding not just the “highlights” of this annuity – which your financial advisor or a seminar presenter may have presented you with – but also the elements of the annuity that could end up to be real drawbacks. With that in mind, knowing the whole story can help you to better determine where this annuity may be strong, as well as where it could end up falling short.
Annuity and Retirement Income Planning Information That Can Be Trusted
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Given our many years of experience with offering unbiased, yet thorough, annuity reviews, we have become a trusted source of information for those who are considering purchasing an annuity, but who also may want to first get more in-depth information about the product before moving forward. This is always a wise idea, just as you would likely do before you make any type of big ticket purchase.
So, if you’re ready to learn more, let’s go ahead and dive in!
Pacific Life Pacific Frontiers ll, 1 Year Guarantee Fixed Annuity at a Glance
| Contact Year | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8+ |
|---|---|---|---|---|---|---|---|---|
| Surrender Charge % | 9 | 8 | 7 | 6 | 5 | 4 | 3 | 0 |
Opening Thoughts on the Pacific Life Pacific Frontiers II, 1 Year Guarantee Annuity
Pacific Life Insurance Company has more than 145 years of experience in the insurance and financial industry. Over time, the company has grown into a well respected and financially strong contender – particularly in the area of life insurance and annuity products.
As of mid-2017, Pacific Life is ranked first in indexed universal life and universal life sales, and it is the 8th largest company in terms of total life insurance sales. On the annuity side, the company is ranked as number 13 in variable annuity sales and 16th largest in sales of fixed annuities. The company also ranks as number 302 on the Fortune 500 list.
As of year-end 2016, Pacific Life held in excess of $143 billion in assets, and more than $10 billion in equity. For the 2016 year, the company had operating income of more than $868 million. All of these figures represent an increase over the previous year.
Due to its financial strength and stability, Pacific Life has very high ratings from all of the major insurer rating agencies, including an A+ from A.M. Best, an A+ from Fitch, and A1 from Moody’s Investor Services, and an AA- from Standard & Poor’s. This can be reassuring when it comes to making good on its policy holders’ claims.
Over the past ten years or so, fixed annuity products have become more popular – primarily because of the constant stock market volatility, along with uncertainty. With this type of annuity, you can ensure that principal is safe – regardless of what occurs in the market and that the funds that are inside of the annuity will grow at a set rate of interest.
But, even though a fixed annuity can provide you with the protection of your hard earned principal, as well as an ongoing income stream in retirement, it is important that you have a more in-depth understanding of all of the pros and potential drawbacks prior to going with this, or any, annuity product.
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. Pacific Life Insurance Company has not endorsed this annuity 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 fixed annuities so that you can decide which may be the best one for you, in order to obtain our free annuity report.
How Pacific Life Describes the Pacific Frontiers II, 1 Year Guarantee Fixed Annuity
Pacific Life describes the Pacific Frontiers II annuity as a single premium, deferred fixed annuity with guaranteed interest rates for a specified period of time.
With a deferred fixed annuity, you have the opportunity to:
- Grow retirement income through the power of tax deferral
- Lock in guaranteed interest rates for a specified term – even during times of market volatility
- Convert assets to guaranteed lifetime retirement income
With the Pacific Life Frontiers II, 1 Year Guarantee fixed annuity, rates can be locked in for one year. Then, at the end of the guaranteed term, you can either elect to withdraw the full amount without charges or to transfer the annuity’s contract value to the same guaranteed term, or to a different available guaranteed term, at the then-current guaranteed interest rate. (If no election is made, the annuity’s contract value will automatically transfer into the same guaranteed term, if it is available.)
There are some other features of the Frontiers II annuity, such as a death benefit. Here, if death occurs before the annuitant starts to take income payments, the annuity contract will pass directly to a named beneficiary (or beneficiaries). This can help them to avoid the expense and the time factor of probate.
How a Financial Advisor Might “Pitch” This Annuity
Because of its safety and guarantees, it is likely that a financial advisor will pitch the annuity as being a way to conserve principal, no matter what is occurring in the market, or even in the economy overall.
In addition, as one of the biggest worries on the minds of retirees is that of outliving their money. Given its lifetime income feature, an advisor will also likely highlight this. (A spouse or other individual can also be added as a second-lifetime income recipient).
But, if you are being presented this annuity by a commissioned sales representative, they are probably going to wow you with the advantages, but only gloss over any of the features that may be considered as drawbacks.
For instance, the low rate of return on this – and most other fixed annuity contracts – can be considered a downfall, as your money will not grow at the rate of inflation, which can essentially reduce your future purchasing power.
Also, when looking a bit closer at the fine print about this annuity, you will notice that the new guaranteed interest rate term will receive the then-current interest rate – however, the withdrawal charge schedule will also reset. This can leave you with an even longer period of time to be hit with surrender charges if you want to need to take out more than 10 percent of the annuity’s contract value.
What About the Fees on this Annuity?
When it comes to fees, the Pacific Frontiers II annuity has a somewhat lengthy surrender period. In this case, you would have to own the annuity for seven full years before being able to withdraw more than 10 percent of the account value without incurring a penalty – per each guaranteed interest rate term. With that in mind, any time that you reset the guarantee, your surrender charge clock essentially gets reset.
Withdrawal Charges During Each Guaranteed Interest Rate Term
| Product Name | Lifetime Income Edge |
|---|---|
| Issuer | Lincoln Financial Group |
| Type of Product | Fixed Index Annuity |
| S&P Rating | AA- (Lincoln National Life Insurance Company) |
| Phone Number | (888) 916-4900 |
| Website | www.lfg.com |
The Annuity Gator’s End Take on the Pacific Life Frontiers ll, 1 Year Guarantee Fixed Annuity
Where it works the best:
This annuity, given its safety of principal and other guarantees, will typically work the best for those who are seeking:
- A safe haven for at least a part of their retirement savings
- A set rate of return (at least for a certain time frame)
- Lifetime income in retirement
Where it works the worst:
Even with its safe features, the Frontiers II annuity will not likely be a good choice for those who:
- Want to achieve a higher rate of return
- Want or need access to more than 10 percent of the contract value during the surrender period (or in this case, multiple surrender periods)
- Do not intend on using the guaranteed lifetime income feature
If you are still leaning towards purchasing the Pacific Life Pacific Frontiers ll 1 Year Guarantee fixed annuity, you should be 100 percent certain that this particular product will do what you want and need it to do – as well as know why you may be choosing this annuity over a plethora of other possibilities.
The only real way to know for sure if this – or any other – annuity is the one for you is to have it tested. We can provide that test for you – at no charge or obligation – by using our annuity calculator and plugging in figures that are more specific to your particular situation. So, if you’d like more detail as it pertains to you and this annuity, please contact us here via our secure contact form.
You can also get more details on how you can compare the best annuity options for you. Just simply so that you can immediately download our free report on how to compare annuities.
In Summary
When you’re considering the purchase of an annuity, it is important that you first consider a number of parameters before you move forward. That way, you will have a much better idea regarding whether or not the product is right for you. This is particularly the case, as annuities are considered to be long term financial vehicles.
Fixed annuities can certainly have some nice features, such as protection of principal, and providing a guaranteed lifetime income in the future – regardless of how long you (and your spouse, if applicable) may live.
With that in mind, the Frontiers II 1 Year Guarantee fixed annuity option from Pacific Life could quite actually be a good option for you. But it could also fall a bit short, and frankly, there may very well be some better choices out there for you. This is particularly true if you are also seeking the opportunity to get a higher rate of return on your money.
Therefore, if you still have any more questions, or would like even more details about the Frontiers II annuity, then please feel free to contact us through our secure contact form right here.
Have Any Additional Questions About the Pacific Life Frontiers II 1 Year Guarantee Fixed Annuity? Did You Happen to Notice Any Mistakes in this Review?
Annuities can be somewhat complex products – even the fixed annuities that may not have quite as many “moving parts” as variable or fixed index annuities. But in any case, these financial vehicles can still be somewhat confusing – even for well-informed consumers. In that case, if this review has sparked any additional questions or concerns that you may have, please let us know and we’ll be happy to address them.
Likewise, if you noticed that any of the information in this review of the Pacific Life Pacific Frontiers II 1 Year Guarantee fixed annuity, please also let us know that, as well, and we will get our team on the case to update the review as soon as possible.
Also, if there happen to be any other annuity products that you would like to see reviewed on our AnnuityGator.com website, just let us know the name of that annuity (or annuities), and we’ll get right to work on it.
Best,
The Annuity Gator
