What Will We Cover in this Annuity Review?In this annuity review of the Symetra Single Premium Fixed Deferred Annuity, we will discuss the following information:
- Product type
- Current rates
- Realistic long-term return 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.If you’ve been considering the purchase of an annuity because you want to ensure that you won’t run out of income in the future – especially if you live a nice, long life – then purchasing the Symetra Single Premium Fixed Deferred Annuity could be a way for you to achieve that goal. That is because this annuity allows you to avoid the ups and downs of the market, while at the same time providing you with a guaranteed, fixed interest rate for a set period of time. Also, when the time comes to convert the annuity over into an income stream, that income can last throughout the remainder of your lifetime, regardless of how long that may be. However, before you go out an purchase the Single Premium Fixed Deferred Annuity from Symetra – or any annuity, for that matter – it is essential that you first get a good understanding of the benefits it can provide, as well as any of the possible drawbacks. This is because even a fixed annuity can be quite difficult, and costly (due to surrender charges) to get out of once you are in. Throughout the past decade or so, fixed annuities have become much more popular with people who are retired, as well as those who are approaching that time in their lives, as they can help to alleviate the concern about running out of money in retirement. But, due in large part to this increased demand, many insurance carriers have been introducing new products – and unfortunately, this can make a product that is already somewhat confusing even more so. This can be the case for well-informed consumers, as well as many insurance and financial advisors! With that in mind, unless the advisor that you work with has a primary focus on selling annuity products, you really should do some additional research on these products, as they will oftentimes require that you deposit a large chunk of your savings into them. That’s where the Annuity Gator can come in!
Annuity and Retirement Income Planning Information You Can TrustIf you have not been to our website before, then please allow us to personally welcome you here to Annuity Gator. We make up a team of experienced annuity professionals who are focused on offering in-depth, and unbiased, annuity reviews. We have been doing this for quite some time now, and far longer than our competitors. So because of this, over time we have come to be known as a highly trusted source of annuity information online. While there are a number of very good websites on the Internet that are focused on offering their annuity products, there are some that will attempt to lure you in with some pretty bold claims like:
- Lowest Fees
- Highest income payouts
- Guaranteed lifetime income
- Top-rated companies
Symetra Single Premium Fixed Deferred Annuity at a Glance
|Product Name||Single Premium Fixed Deferred Annuity|
|Type of Product||Fixed Deferred Annuity|
|Phone Number||(800) 796-3872|
Opening Thoughts on the Symetra Single Premium Fixed Deferred AnnuitySymetra has been in the insurance and wealth protection business for more than 60 years. The company today holds in excess of $42 billion in assets and is highly rated by the insurer rating agencies for its strong financial footing, and its timely payment of policyholder claims. The company serves over 2 million customers through a nationwide network of financial institutions, broker-dealers, independent agents, advisors, and benefits consultants. In addition to being a pioneer in the area of medical stop-loss insurance, Symetra is also a leader in the fixed deferred annuity arena, particularly through the banking channel. With so much volatility and unpredictability in the stock market over the past several years, the demand for fixed annuities has grown quite a bit, particularly as a way for retirees (and those who are preparing for retirement in the near future) to keep assets safe, and to ensure that they have a stable and reliable income going forward. Unfortunately, though, due to the historically low-interest rate environment that we’ve been stuck in for nearly a decade now, the return that has been offered by fixed annuities has been very low. In fact, in many instances, the returns that are obtained on fixed annuities have not even been enough to outpace the inflation rate over time. Because of these low rates, your future purchasing power could be affected – especially if you plan to use the income from a fixed annuity as a primary source of your retirement income down the road.
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. Symetra 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 fixed 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 Symetra Describes the Single Premium Fixed Deferred Annuity ProductAccording to Symetra, the Single Premium Fixed Deferred Annuity allows you to choose an interest rate guarantee of three, five, or seven years, depending on the product option that you choose. For example, with the Symetra Custom 7, rates can be guaranteed for 3, 5, or 7 years, whereas with the Symetra Custom 5 fixed deferred annuity, interest rate guarantee periods are for either 3 or 5 years. Both of these options will allow minimum subsequent purchase payments of $1,000 during the first 12 months that you own the annuity. As with other annuity products, the interest on your money inside of the Single Premium Fixed Deferred Annuity is able to grow on a tax-deferred basis. This means that there is no tax due on the gain until the time of withdrawal – which can essentially allow the funds to compound exponentially. The fixed deferred annuity options from Symetra also offer some additional “bells and whistles,” such as a nursing home and a hospitalization waiver whereby surrender charges may be waived if you withdraw funds from the annuity and meet certain guidelines. For more information on the Symetra Single Premium Fixed Deferred Annuity – both the Custom 7 and the Custom 5 options, you can take a look at the product fact sheet HERE.
How a Financial Advisor May “Pitch” the Symetra Single Premium Fixed Deferred Annuity ProductAs you approach retirement, protection of your hard-earned principal will typically become more and more important – as well the assurance that you will have enough income in the future, regardless of how long you may need it. Given that, it is likely that if you are being presented this annuity by an insurance or financial advisor, he or she will key in on these guarantees. Yet, while having these assurances can help you to sleep a bit better at night, the reality is that the interest rates today (and for the past decade or so) that are offered on fixed annuity products would have you hard pressed to meet, much less beat, inflation. This, in turn, could put you in a bind in the future when it comes to ensuring that your income is keeping up with the rising cost of goods and services that you need to purchase. In fact, the guaranteed minimum interest rate of 1.0% on the Custom 7, and only .50% on the Custom 5 aren’t even as much as you could get by putting your money in a basic savings or money market account. (And if you went that route, your funds would be a lot more liquid, too).
Are There Any Fees on the Symetra Single Premium Fixed Deferred Annuity?Along those lines of liquidity, you will also have to watch out for surrender charges if you withdraw more than 10% of your money from the Custom 7 or Custom 5 annuity during the time of the surrender period. Each of these products has a surrender period as follows:
Custom 7 Surrender Charge Schedule
Custom 5 Surrender Charge Schedule
The Annuity Gator’s End Take on the Symetra Single Premium Fixed Deferred AnnuityWhere it works best: This particular annuity will usually work the best for those who are looking for:
- Guaranteed lifetime income
- Safety of principal
- Interest rate guarantee – at least for a certain period of time
- Want access to most or all of your funds within the first several years (during the surrender charge period)
- Are seeking a high rate of return on your money
- Do not anticipate using the annuity for lifetime income