What’s Covered In This Review
In this review, we’ll cover the following information on the Forethought SecureFore 5 Fixed Annuity:
- 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’re considering a financial vehicle that can offer you security, along with a stable stream of income in the future, the Forethought SecureFore 5 Fixed Annuity may be a viable option for you – starting with the fact that it offers protection of principal, along with other guarantees that are built directly into the annuity contract.
But, prior to moving forward with the purchase of this – or any other annuity – it can be beneficial to have a more in-depth understanding of how these products work, and how it may or may not fit into your specific financial situation.
Over the past several years, annuities have become much more popular as a way to offer a guaranteed stream of income in retirement. And because of that, the number of financial advisors who are offering these vehicles has expanded exponentially. But, this isn’t necessarily a good thing. This is because, while most financial advisors vie to do the right thing for their clients, they may not always be providing you with the answers to the questions that should ideally be answered about purchasing a fixed annuity.
Also, due in part to their growing popularity, the array of annuity products that are now available has grown – and some of these annuity offerings can be confusing to understand, even for well-educated individuals. With that in mind, additional steps should be taken in order to really understand what it is you are buying – especially as this could comprise a substantial percentage of your overall retirement income in the future. This is particularly the case as annuities are considered long-term endeavors, and once you get in, there can be penalties and fees involved if you want to get back out.
Annuity and Retirement Income Planning Information That You Can Trust
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If you’ve been looking for any information about annuities online, it is likely that you may have come across some conflicting details regarding these products. This isn’t surprising, as there are many details out there. You may also have attended an annuity seminar recently – which might even have led you here in order to obtain more in-depth details on an annuity that you’re considering.
Although there are a number of very good websites that are devoted to marketing their annuities online, some of these tend to lure visitors in by offering claims such as the following:
- Highest annuity payouts
- Low fees
- Guaranteed income for life
- Top Rated Annuity Companies
- Get an Annuity Quote Now!
While these claims might sound great, just like when you purchase any other product or service, you need to determine whether or not they are really true. Sometimes, this can entail delving into a vast array of “small print” that in some cases, can make it even more confusing.
But, if you want to find out more about the Forethought SecureFore 5 Fixed Annuity, you have definitely come to the right place. In fact, dare we say that this site is the only place where you can actually find out all of the details – including the advantages and the drawbacks – that can help you in determining whether or not this particular annuity is right for you.
Oftentimes, the insurance agents who are offering fixed annuities will provide a nice picture of how their products provide safety – but will often leave out the details on the potential drawbacks that products have. So, before you move a chunk of your hard-earned savings into one of these annuities, it is essential that you know the whole story.
Just to be clear, fixed annuities can be extremely advantageous – if they fit into your overall financial picture. With that in mind, it is key that you know just exactly what it is that you are getting, as well as why you are choosing it over a myriad of other financial options.
This annuity review is here to help you with better understanding all of the “fine print” so that you have a much more clear knowledge of whether or not the Forethought SecureFore 5 Fixed Annuity will be right for you in achieving your ultimate retirement goals.
So, if you’re ready to begin, let’s go ahead and dive in!
Forethought SecureFore 5 Fixed Annuity
|Product Name||NWL Global Lookback Annuity|
|Type of Product||Indexed Annuity|
|Issuer||National Western Life|
|Standard and Poor's Rating||"A" (Strong)|
Opening Thoughts on the Forethought SecureFore 5 Fixed Annuity
Forethought Life Insurance Company was initially founded in 1985 – which makes it somewhat of a newcomer to the insurance industry. It began with a focus on offering pre-need funeral expense insurance. It has since moved into other, related product lines, including fixed annuities. In fact, by adding broker-dealer and annuity capabilities from The Hartford in 2013, the company has been able to enter the annuity field with both feet.
Today, Forethought is actually a part of the Global Atlantic Financial Group. Global Atlantic holds approximately $45 billion in assets – nearly $19 million of which is attributable to Forethought Life Insurance Company. So, the company’s financial foundation is stable.
This is reflected in the company ratings, where Global Atlantic has an A- from A.M. Best, which is considered Excellent. Also, Forethought Life Insurance Company is an A+ rated entity via the Better Business Bureau.
Due in large part to market volatility over the past decade or two, the demand for fixed annuities has grown substantially as a way for retirees and/or those who are preparing for retirement to keep principal safe.
However, because of the historically low-interest rate environment of late, the return that has been offered by fixed annuities has been quite low. In fact, oftentimes, fixed annuity returns are not even enough to outpace the rate of inflation – and because of that, it could affect purchasing power in the future. This is especially the case if you plan to use this vehicle for a bulk of your future retirement income stream.
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. Forethought 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 fixed annuities so that you can decide which may be the best one for you, contact us in order to obtain our free annuity report.
How Forethought Life Insurance Company Describes the SecureFore 5 Fixed Annuity
On the Global Atlantic website, you can find more details regarding the SecureFore 5 Fixed Annuity. The company describes this particular product as offering a five-year rate guarantee.
In addition, the website and the Forethought SecureFore 5 annuity brochure also offer information about how fixed annuity purchasers can keep their money safe for when it is needed, via the SecureFore annuity’s:
- Guaranteed minimum interest crediting rate
- Principal protection against potential loss due to stock market risk
- Free-of-charge withdrawals each year of up to 10 percent of the annuity’s value
- Full accessibility without penalty after the surrender charge period – which on this annuity is five years
- A guaranteed full contract value death benefit that is payable to your designated beneficiaries
This annuity also offers an optional Return of Annuity Deposit feature, which ensures that you will never receive back less than what you paid for the annuity. As with other types of annuities, the money that is in the Forethought SecureFore 5 fixed annuity is allowed to grow on a tax-deferred basis. This means that there is no tax due on the gain until the time of withdrawal.
How Financial Advisors Might “Pitch” This Annuity
The Forethought SecureFore 5 Fixed Annuity is a single premium deferred annuity that is available to you if you are age 85 or younger. It allows a minimum deposit of $10,000 and a maximum of $1 million – which may actually vary, based on your household and state of residence.
If you have been approached by an insurance or financial professional who is offering you this annuity, then they may have keyed in on certain features that it offers, such as a guaranteed rate, as well as an ongoing stream of income in the future that can last throughout your entire lifetime – regardless of how long that may be.
However, as an educated consumer, it is likely that you have probably also noticed that insurance and financial companies do a great job of making sure that their products sound enticing. For example, if you read over the bullet points above, then you may have immediately thought that the Forethought SecureFore 5 Fixed Annuity was an ideal option for you.
It is important to note here that, if you are being offered this annuity – or any annuity – by a commissioned advisor, then they are probably going to explain it to you highlighting all of its positive features.
But, when taking a closer look at the above-referenced points, even though they may initially sound really great, once you have gotten a bit deeper into the annuity’s fine print, you could realize that the picture isn’t as bright as it seemed at first. For instance, while the Forethought SecureFore 5 fixed annuity offers a guaranteed crediting rate, when taking a deeper dive into the literature, you will find that it also states, “This information is provided for illustrative purposes only and should not be considered representative of past, current, or future performance of The SecureFore 5.
You may also notice that, according to the SecureFore 5 Fixed Annuity brochure that higher annuity deposits will receive more favorable rates. (Or, conversely, lower annuity deposits receive less favorable rates). For example, the rates on this annuity are divided into three different components:
- Regular band: $10,000 to $24,999
- High band: $25,000 to $99,999
- Jumbo band: $100,000 plus
So, depending on how much you deposit into the annuity, the rate that you receive may actually differ, which in turn, can make a difference in the amount of the future income that you receive from this annuity.
Also, due to the 5-year interest rate guaranteed period, once the rate period has elapsed, your annuity’s rate will be declared on an annual basis, and going forward, will only be guaranteed for one year.
So, while safety of principal and a lifetime retirement income may be important, the reality is that these features can be found on any fixed annuity – and, if you are able to find these features, along with the opportunity for a higher return on your funds, it may be worthwhile to take a closer look at other alternatives that are available to you.
The bottom line here is that, while there are certainly some attractive features on the Forethought SecureFore 5 Fixed Annuity after you’ve locked up a lump sum of money in this vehicle, it could be too late for you to change your mind if another, better option was to come along.
Given that, if you are still not sure whether or not the Forethought SecureFore 5 Fixed Annuity is right for you, and you want answers to some additional questions or concerns, then feel free to reach out to us through our secure contact form here.
We know how confusing it can be when trying to decide whether or not a particular annuity may be right for you. But, knowing what you need to look for in these products is critical, as they could comprise a significant percentage of your retirement funds. If you want additional assurance that you know what it is you are purchasing, then click here to download our free report on what you need to know before buying an annuity.
What About Fees on the Forethought SecureFore 5 Fixed Annuity?
In addition to knowing how your money may perform in an annuity, it is also a good idea to know about any of the fees that you may be charged, both during the annuity’s “accumulation” phase, and when you’re taking income.
The fees that you are charged on an annuity can add up – and they can also have an effect on the amount of future retirement income that you are able to generate. Just some of the fees that are oftentimes found on fixed annuities include a commission to the advisor who sold it and ongoing administrative charges. Plus, if you do opt to withdraw more than the allocated amount of “free” withdrawals prior to the annuity’s “income” phase, you could also be hit with a surrender charge, as well as a 10% IRS early withdrawal fee if you are under age 59 1/2.
In the case of the Forethought SecureFore 5 Fixed Annuity, there are five years of surrender charges. These begin at 8 percent for Year 1 and Year 2. The fee then goes to 7 percent in Year 3, 6 percent in Year 4, and to 5 percent in Year 5. (These percentages may differ if you reside in the state of Ohio).
The Annuity Gator’s End Take on the Forethought SecureFore 5 Fixed Annuity
Where it works best:
This particular annuity will usually work the best for those who are looking for:
- Safety of principal
- Guaranteed lifetime income in retirement
- Guaranteed rate protection for the first few years of owning the annuity
Where it works the worst:
This annuity may not be an ideal fit if you:
- Want access to most or all of your funds within the first five years
- Are seeking a high rate of return on your money
- Do not intend to use the lifetime income feature
In order to truly know how to compare the best annuity options for you, click here so that you can download our free annuity report.
There are a number of key factors that should be considered when determining which annuity may be right for you – or even if an annuity is the best option for your money. In any case, annuities are always considered to be long-term financial endeavors. Because of that, it is essential that you feel comfortable in knowing how an annuity may get you closer to your ultimate retirement goals.
When leaning towards a fixed annuity, these vehicles can provide you with the safety of your principal, as well as a guaranteed, ongoing income throughout your retirement – no matter how long you need that incoming cash flow. This can provide you with the security of knowing that you won’t run out of income down the road.
In the case of the Forethought SecureFore 5 Fixed Annuity, there are some good features about it. However, it may also still fall a bit short, and quite frankly, there could be some better options that are available to you – particularly if you are seeking lifetime income, along with the opportunity for growth.
If you still have any additional questions regarding whether this particular annuity is the right one for you, or even if you just simply need some additional assistance in guiding you in the right direction, please feel free to reach out to us directly throughout secure contact form here.
Have Any Additional Questions on the Forethought SecureFore 5 Fixed Annuity?
We realize that this review may have been somewhat lengthy – but we would much rather provide a bit “too much” information as versus not enough. So, if you found this review to be beneficial, then please feel free to share it with others.
In addition, we also realize that annuity information can change on a regular basis. So, if you happened to see any information in this review that may need to be revised or updated, please let us know and we will be happy to make any of the necessary corrections.
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