What Will We Cover in this Annuity Review?
In this annuity review, we will be covering the following details regarding the Eagle Life Advisory 8 Fixed Index Annuity:
- Product type
- 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.
Most people look forward to retirement as a relaxing time in their lives. Unfortunately, though, with more and more employers doing away with defined benefit pension plans, retirees are left to fend for themselves in terms of locking in a long-term income that will last as long as they need it to.
While the “safe withdrawal rate” from a retiree’s portfolio used to be in the range of 4%, experts now feel that this rate is closer to 2%…or even less…due to market fluctuations and a low-interest-rate environment.
So, what can you do to ensure that you won’t run out of income in retirement?
One option is to purchase an annuity. Not only will annuities provide you with a set amount of income over time – including for the remainder of your lifetime – but some annuities will also allow you to obtain growth that is based on upward market movements.
For example, with the Eagle Life Advisory 8 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.
As 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.
For these reasons, fixed index annuities have become quite popular, particularly with those who are approaching retirement, given their “best of all worlds” features. But before you dive in headfirst and buy the first fixed index annuity you come across, it is really important to know how these financial vehicles work, and what you may anticipate in terms of its performance.
That’s where the Annuity Gator comes in!
Annuity and Retirement Income Planning Advice You Can Trust
If you’ve never been to our website before, then please allow us to personally welcome you to AnnuityGator.com. We’re a team of annuity professionals who focus on offering both comprehensive and unbiased annuity reviews. We have been at this for quite some time now – far 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 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.
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.
With that in mind, if you’re looking for more in-depth details regarding the Eagle Life Advisory 8 annuity, you are definitely in the right place. In fact, we dare say that our 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!
Eagle Life Advisory 8 Fixed Index Annuity at a Glance
|Product Name||Eagle Life Advisory 8|
|Issuer||Eagle Life Insurance Company|
|Type of Product||Fixed Index Annuity|
|A.M. Best Rating||A- (Excellent)|
|Phone Number||(866) 526-0995|
Opening Thoughts on the Eagle Life Advisory 8 Fixed Index Annuity
Eagle Life Insurance Company is a subsidiary of American Equity Investment Life Insurance Company. It is a relatively new entrant into the life insurance and annuity arena. This insurer first opened its doors in the summer of 2008 – at a time when many other financial and insurance companies were going under.
This company focuses on the financial institution distribution channels, which means that if you have a financial advisor who is independent, he or she may be able to offer you an insurance policy and/or an annuity through Eagle Life.
American Equity Investment Life Insurance Company, the parent company of Eagle Life Insurance Company, has a strong financial footing, with more than $53 billion in assets. It is rated highly by the insurer rating agencies, with an A- (Excellent) from A.M. Best, and an A- (Strong) from Standard & Poor’s. As of year-end 2018, American Equity was the number three producer of fixed index annuities in the U.S.
Eagle Life Insurance Company offers both traditional fixed annuities and fixed indexed annuity products. Both of these types of annuities offer tax-deferred growth, as well as the ability to convert funds into a lifetime income stream.
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. Eagle 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, click here in order to obtain our free annuity report.
How Eagle Life Describes the Eagle Advisory 8 Annuity
Fixed index annuities offer protection of principal, as well as an opportunity to earn a higher rate of return than a regular fixed annuity, based on the performance of an underlying market index like the S&P 500.
Eagle Life Insurance Company uses two common indexes for its fixed index annuity return tracking purposes. These include the:
- S&P 500
- S&P 500 Dividend Aristocrats Daily Risk Control 5% Index
It is up to you to choose whether one or both of these indexes will be used to track your annuity’s return. There is also a fixed account option.
- Safety of principal
- Guaranteed income
- Tax-deferred growth
Annuities can also help your loved ones to avoid probate – which can oftentimes be a costly and time-consuming process.
The Eagle Advisory 8 annuity offers a choice of index crediting methods. These include the:
- Annual Point-to-Point – With this method, on each contract anniversary the index value is compared to the previous year’s index value. The index credit is based on the increase in the index value from point to point. Caps or participation rates are also applied to the index credit calculation.
- Volatility Control Index – With this index crediting method, on each contract anniversary the index value is compared to the prior year’s index value. The index credit is based on the increase in the index value from point to point, less a spread fee.
There are several other “bells and whistles” offered with the Eagle Advisory 8 annuity, such as:
- Market Value Adjustment (MVA) Rider – The market value adjustment may increase or decrease the amount of a withdrawal in excess of the penalty-free withdrawal amount or the surrender value. In general, as the MVA index increases, cash surrender values decrease. As the MVA index decreases, cash surrender values increase. Interest rates may be higher for contracts with an MVA rider.
- Confinement Care Rider – This rider allows you to take a 100% penalty-free withdrawal after the first contract anniversary if confinement in a qualified nursing care center occurs after the end of the first contract year, and continues for at least 90 days (or for 30 days in a hospice). There is no additional premium charged for this rider.
- Terminal Illness Rider – The terminal illness rider allows you to take an additional penalty-free withdrawal, up to 100% of the contract value, if the diagnosis of a terminal illness by a qualified physician occurs after the first contract year, and is expected to result in death within one year. This rider is also included at no additional premium cost.
- Death Benefit – A death benefit may be paid to a named beneficiary (or beneficiaries), with no surrender charges, if the annuitant passes away before receiving back all of his or her paid-in premiums.
For more in-depth details regarding the Eagle Life Advisory 8 annuity, you can check out the full product brochure HERE.
You can also choose to add a lifetime income benefit rider to your Eagle Life fixed indexed annuity. This option can help you to secure a guaranteed lifelong income source. It offers a set accumulation period where the money is able to grow tax-deferred, up to the time when the first income payment is received. (Note that if you add this rider, an additional fee will be deducted from your annuity’s contract value each year).
For more details on the Eagle Life lifetime income benefit rider, or LIBR, go HERE.
How an Insurance or Financial Advisor Might “Pitch” this Annuity
Because the Eagle Advisory 8 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 your checkbook and dive into a commitment with the Eagle Advisory 8 annuity, there are a few other details that are important for you 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. With that in mind, while you may get PART of the upward return, you won’t necessarily always get ALL of it.
If you’re seeking liquidity, this annuity doesn’t really stand out in this category, either. That’s because you can only withdraw up to 5% of the contract’s value penalty-free during the surrender period.
What About Fees on the Eagle Life Eagle Advisory 8 Fixed Index Annuity?
Speaking of fees! We’re glad you asked! That’s because there is an 8-year surrender period here. This means that if you withdraw more than just 5% of your contract’s value within the first eight years of purchasing the annuity, you’ll be hit with a penalty fee.
On top of 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 Eagle Life Insurance Company’s Eagle Advisory 8 Annuity
There are many annuities that you can choose from in the marketplace today. But, while having a broad range of options available can be nice, it can often make it more confusing to determine which one will truly fit your needs. That’s why it is important to have an annuity expert on your side.
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, the Eagle Advisory 8 Fixed Index 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 eight years of purchasing the annuity
- Do not intend to use the guaranteed lifetime income feature
There are numerous 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 Eagle Advisory 8 annuity 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. That being said, 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. Therefore, if you happened to notice anything in this annuity review for the Eagle Life Advisory 8 annuity 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?
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.
The Annuity Gator
P.S If you would like to read more of our Eagle Life annuity reviews here are some links to check out:
- Independent Review of the Eagle Life Eagle Platinum MYGA Annuity
- Independent Review of the Eagle Life Eagle Select 10 Fixed Indexed Annuity