What is Covered in this Annuity Review?
In this annuity review, we will be covering the following details regarding the Thrivent Single Premium Deferred Fixed Annuity:
- Product type
- Fees
- 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 have been considering moving forward with the purchase of annuity because you want to assure yourself of a reliable, ongoing income stream in retirement, then the Single Premium Deferred Fixed Annuity from Thrivent Financial could be a good option for you.
However, prior to moving full steam ahead with committing to this product, it is a good idea for you to first have a more in-depth idea regarding how the annuity works, as well as how it may – or may not – work for you and your financial goals.
Over the past several years – and especially since the 2008 U.S. economic recession and market downturn – fixed annuities have become much more popular. One reason for this is because these annuities can provide retirees with a way to ensure that they will have an income stream for the rest of their lives – no matter how long they may need it.
Yet, while it can certainly be reassuring to have such guarantees, an annuity should always be considered a long-term financial commitment. So, be sure that you know the positives and the possible negatives prior to making a purchase of one.
When seeking both the pros and the cons about annuities, it can be a bit of a challenge to find all of the pertinent details that you need. This is because the positive points about annuities can easily be found in brochures and other marketing materials, while the drawbacks are oftentimes hidden in a myriad of “fine print.” This is where we can help.
This is where we come in!
Annuity and Retirement Income Planning Information You Can Trust
If you have never dropped by our website before, please allow us to personally welcome you here to AnnuityGator.com. We are a team of experienced financial pros who are focused primarily on offering the most comprehensive – and unbiased – annuity reviews that can be found here on the Internet. We’ve been doing this for many years now – far longer than our competitors, and because of that, we are considered to be a highly trusted source of annuity information online.
We have also seen – particularly over the past several years – numerous “copycat” websites appearing online. In doing a bit of research of our own, we’ve found that most of these websites just simply repeat the very basic information about fixed annuities that you’ve likely already heard.
There may be any number of reasons why you’re seeking more information regarding annuities. For example, it could be that you are approaching retirement and you’re looking for a safe place to put your savings so that you won’t lose any of your principal. It could also be that you are seeking more details on how to stretch your retirement income so that it lasts for the rest of your lifetime.
In any event, if you’ve been spending time online doing research on annuities, then it is likely that you have run across some pretty conflicting details about these financial vehicles. This isn’t really surprising, because there are a lot of different annuities available in the market today, along with numerous opinions about them.
The good news is that, if you are in search of more details regarding the Thrivent Single Premium Deferred Fixed Annuity, then you are definitely in the right place. But what you will learn here is not just the good, but also the details that could be considered as drawbacks. This is because we feel that knowing the whole picture is the only way to be able to make a clear decision on whether or not an annuity (or any financial product) is right for you.
Just to be perfectly transparent here, we want to say for the record that we think annuities are a good product for retirees and those who are saving for retirement – but only if the annuity meets your specific financial needs and objectives.
With that in mind, this annuity review is here to help you with determining whether or not the Thrivent Single Premium Deferred Fixed Annuity can benefit you – or alternatively, if there may be another, better-suited option out there.
So, if you’re ready to get started, let’s go!
Thrivent Financial’s Single Premium Deferred Fixed Annuity at a Glance
| Premium Amount | 3 Year | 4 Year | 5 Year | 6 Year | 7 Year |
|---|---|---|---|---|---|
| $100,000 - $1,499,999 | 2.05% | 2.10% | 2.25% | 2.35% | 2.45% |
| $50,000 - $99,999 | 1.90% | 1.95% | 2.20% | 2.25% | 2.40% |
| $25,000 - $49,999 | 1.70% | 1.75% | 1.90% | 2.00% | 2.15% |
| $5,000 - $24,999 | 1.45% | 1.50% | 1.75% | 1.85% | 1.95% |
Opening Thoughts on the Thrivent Financial Single Premium Deferred Fixed Annuity
Thrivent Financial is a Fortune 500 Company that has been in business for more than a century. Starting as a membership for Lutherans, this non-for-profit membership organization of all Christians today has a focus on helping its members be wise with money, build solid financial futures, strengthen their communities, and to be good stewards of the gifts that God has given them.
As of 2018, Thrivent has more than 2 million members nationwide. It is considered a strong and stable company, with $136 billion dollars in assets under management (as of December 31, 2017). Represented by total surplus, Thrivent has one of the strongest capital positions in the insurance and financial services industry.
Thrivent has earned very high ratings from the insurer rating agencies. These include a(n):
- A++ from A.M. best – the highest of 16 possible ratings
- AA+ from Fitch – the second highest of a possible 19 ratings
The company has also earned numerous awards and accolades, including:
- “World’s Most Ethical Companies” by Ethisphere Institute 2012 – 2018
- Ward’s 2016 50 Top Performing Life and Health Insurers
- America’s Top Workplaces (Workplace Dynamics 2015)
Over the past decade or so, the demand for annuities, which are always backed by insurance companies, has been increasing steadily – particularly since market volatility has become the “norm” rather than the exception.
Today, one of the biggest fears on the minds of retirees – as well as many of those who are preparing for retirement – is that of running out of income. Therefore, keeping principal safe is one of the ways to ensure that hard-earned savings won’t disappear in a downward moving stock market.
A fixed annuity can provide them with that solution.
Yet, due in large part to the low-interest rate environment of late, the return that is earned on fixed annuities may not be enough for retirees to even come close to meeting or beating future inflation. And, if you plan to use the income from a fixed annuity as a bulk of your incoming cash flow in the future, it may be difficult to maintain ongoing purchasing power for the goods and services that you need to buy.
Before getting into the gritty details, here are some legal disclosures…
This is an independent product review, and it is not to be considered as a recommendation to purchase or to sell an annuity. Thrivent Financial has not endorsed this review in any way, nor do we receive any compensation for offering 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 the negatives of this particular annuity product. Prior to purchasing any insurance or investment product, you should be sure to do your own due diligence and consult a properly licensed professional if you 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.
For additional information on how to compare annuities so that you can decide which may be the best one for you, to get access to our free annuity report.
How Thrivent Describes the Single Premium Deferred Fixed Annuity
According to Thrivent, its single premium deferred fixed annuity allows you to turn a single premium payment into future income. Plus, you earn a fixed interest rate and the opportunity for tax-deferred growth. you also can take limited withdrawals without incurring a surrender charge.
With the Deferred Fixed Annuity from Thrivent, you can earn a guaranteed minimum rate of 1%.
The rate that you will earn during the first two years of a new contract will depend on how much you contribute to the annuity up-front. For example, (as of December 1, 2017), the following interest rates apply:
| Option 1 | Option 2 | |
|---|---|---|
| Potential interest rate increase | 0.50% | 1.00% |
| Interest rate increase trigger | 10-year Treasury rate increases by at least 0.50% on an interest rate opportunity date | 10-year Treasury rate increases by at least 1.00% on an interest opportunity date |
| Interest opportunity dates (i.e., dates New York Life will check for Treasury rate increases) | Policy semi-anniversary and anniversary in the first year | Policy semi-anniversary and anniversary in the first two years |
| Rate increase | Occurs automatically if triggered | Occurs automatically if triggered |
| New rate period | New rate will apply for the remainder of the guarantee period | New rate will apply for the remainder of the guarantee period |
*Note that the two-year interest rate is applied to the first premium, and will remain in effect for at least 24 months. After 24 months, subsequent interest rates will not change more often than once every 12 months.
When the time comes to convert the annuity over into an income stream, there are multiple payout options available, which can allow you to choose how and when to take income, based on your specific needs.
How an Insurance or Financial Advisor Might Pitch this Annuity
With the Thrivent Single Premium Deferred Fixed Annuity being a fixed rate product, it is probable that an insurance or a financial advisor who is offering this annuity to you would focus in on the guarantees that this annuity can offer. In addition, the money that you put into this product – along with all of the growth – will be safe from a volatile market, regardless of what occurs.
When it comes to receiving income from this annuity, you can count on a set, guaranteed steam for yourself, or for yourself and a spouse or partner (or other individuals that you choose). And, by going with the lifetime income option, this incoming cash flow will continue for as long as you need it to.
However, even though the Single Premium Deferred Fixed Annuity from Thrivent Financial can provide you with some very nice benefits, there are also some areas that could be considered as drawbacks, depending on your overall financial needs and goals.
For instance, given the low interest rate environment that we’ve been stuck in for the past ten years or so, you will likely have a very difficult time with meeting – much less beating – inflation, which in turn, can equate to you having to cut back on the purchases of items and services that you need in the future, as your income will not be able to keep pace with their rising costs.
What About Any Fees Associated with the Single Premium Deferred Fixed Annuity from Thrivent?
When considering any financial or insurance product, you can be hard-pressed to find one that does not require at least some “cost” of ownership. Annuities are no different. So, there are some fees to be mindful of if you do move forward with the purchase of the Thrivent Single Premium Deferred Fixed Annuity – the biggest of which could be the surrender charges.
In this case, if you withdraw in excess of 10% of the annuity’s contract value during the surrender charge period, you will be penalized – and, if you make such withdrawals when you are younger than age 59 1/2, then you could also be hit with an additional 10% “early withdrawal” penalty from the IRS. When added together, these charges and fees can significantly reduce the amount of money that you’ll net out.
The Annuity Gator’s End Take on the Single Premium Deferred Fixed Annuity from Thrivent Where this annuity would work the best:
Although the Thrivent Single Premium Deferred Fixed Annuity will not be right for everyone, this product could be a good fit for you if you are looking for the following features:
- Safety of principal
- A fixed, set rate of growth
- A place to transfer a lump sum of money, such as the funds from an employer-sponsored retirement account and/or IRA
- A guaranteed stream of lifetime income in the future
Where this annuity would work the worst:
Alternatively, this annuity might not be right for you if you are looking for the following:
- The opportunity for a higher rate of return
- Access to your money (more than 10% of the contract’s value) during the surrender period
It may also not be worth taking the risk of such a low rate of return if you do not plan to use the lifetime income features on this annuity.
In Summary
If you are still on the fence about the purchase of the Thrivent Single Premium Deferred Fixed Annuity, then it is important that you get all of your questions and/or concerns addressed prior to committing what could be a large chunk of your overall retirement savings.
Provided that you do move forward with this particular annuity, though, you can be assured that you will have a set rate of growth and safety of your principal, along with an ongoing income that you can count on in retirement.
That being said, the only way to truly know whether this annuity may work well for you is to have it tested. We can do this testing for you – and we will provide you with the results at no charge or obligation. So, just let us know if this is something that is of interest to you.
Need Any More Information? Did You Happen to Notice Any Mistakes in this Annuity Review?
We understand that this annuity review of the Thrivent Financial Single Premium Deferred Fixed Annuity ran a bit on the long side. So we do appreciate you sticking with us through here to the end. Our thoughts are, though, that it is always better to provide “too much” in terms of detail as versus not enough.
With that in mind, if you felt that this annuity review was beneficial to you, then please feel free to share it and forward it on to anyone else that you think may also find value from it. Also, as humans will often do, we also understand that information about annuities can change quickly. Therefore, if you happened to notice any details in this review that were out of date or that need correction, please let us know that as well, and we will get it fixed quickly.
Would you like to have us review any other annuities?
No problem! If you have run across any other annuities that are not yet featured in our online database, then let us know the name (or names) of these annuities and our annuity “geeks” will get right on it!
Best,
The Annuity Gator
