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Independent Review of the AARP Secure Term Guarantee Annuity from New York Life

What’s Covered In This Review

In this review, we’ll cover the following information on the AARP Secure Term Guarantee Annuity from New York Life Insurance Company:

  • Product TypeIndependent Review of the AARP Secure Term Guarantee Annuity from New York Life
  • 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 are considering the purchase of a fixed annuity because you want to be sure that you’ll have retirement income that lasts throughout your retirement years, then the AARP Secure Term Guarantee Annuity from New York Life Insurance Company could be a viable option for you. One reason for this is because this product offers several guarantees, both during the savings, or “accumulation” phase, as well as during the time that you’d be receiving your income.

But, before diving blindly into this product, it is highly recommended that you obtain an in-depth understanding of just exactly how this annuity works, as well as how it may or may not fit in with your specific financial goals. Once you have done so, you can then make a well-informed decision to either proceed with the purchase of this annuity or to move on with another alternative that could work better for you.

Over the past several years – and particularly since the economic crisis of 2008, fixed annuities have become very popular financial products, especially for those who are seeking a set rate of growth and safety of principal, along with a guaranteed lifetime income that can’t be outlived.

Yet, even though these types of guarantees may be reassuring, keep in mind that due to the historically low-interest rate environment that we’ve been living in for the past decade or so, the growth that you ultimately get may not even be enough to keep pace with inflation.

On top of that, an annuity should always be considered as a long-term financial commitment. Therefore, unless you are 100 percent sure that this is the right annuity for you, then you may run the risk of moving forward, and then change your mind down the road – which could prove to be an expensive mistake.

This annuity review here to help 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

If you have never visited our we would like to officially welcome you here. We comprise an experienced team of financial pros who have a focus  onIndependent Review of the AARP Secure Term Guarantee Annuity from New York Life providing very comprehensive annuity reviews that are also unbiased. We have been providing this service to our website visitors for many years – much longer than the many other “copycat” websites that you may have come across in your research on annuities.

Due to our experience with providing annuity reviews, we have become a highly trusted source of information for those who are thinking about getting an annuity, but who might also wish to have more specific details before moving forward with confidence.

If you did happen to come across of the other annuity-related websites out there on the Internet, it is possible that you’ve noticed a pattern with certain sites that tend to promise you the world – such as low fees, high-income payouts, and/or quick quotes. But in reality, this is really just simply their way of luring you in and asking you for your contact information.

Sadly, even though such claims can and do sound very enticing, in reality, they are really only providing you with a part of the whole picture. Given that, prior to moving forward with the purchase of an annuity – and in turn, committing a large amount of your savings to it – you need to be sure that you’ve gotten all of the facts.

This review of the AARP Secure Team Guarantee Annuity from New York Life Insurance Company is here to help you with sorting out the details – both the good and the bad – and it will provide you a nice clear path to assist you in wading through all of the “fine print” that is typically associated with annuities.

So, if you’re ready to start, let’s get started!

AARP Secure Term Guarantee Annuity From New York Life at a Glance

Product NameSecure Term Guarantee Annuity
IssuerNew York Life Insurance Company / AARP
Type of ProductGroup Fixed Annuity
S&P RatingAA+ (Very Strong)
Phone Number(800) 313-6841
Websitehttps://www.nylaarp.com/Annuities/GFI#/OneStep

Opening Thoughts on the AARP / New York Life Fixed Deferred Annuity

New York Life Insurance and Annuity Company – one of the oldest insurers in the U.S. today – is the only insurance company that is trusted by AARP to provide annuity products to its members. One reason for this could be that New York Life is the number one provider of income annuities. In addition, this insurer has the highest possible ratings that are given by the four insurer rating agencies. These include:

  • A++ (Superior) from A.M. Best
  • AAA (Exceptionally Strong) from Fitch
  • AA+ (Very Strong) from Standard & Poor’s
  • AAA (Exceptional) from Moody’s Investor Services

This insurance carrier has an impressive, industry-leading cash reserve that is in excess of $23 billion, so the company is well prepared to meet its commitments to its policy holders. Plus, New York Life has also consistently paid out dividends both before, during, and after the Great Depression, and the more recent Great Recession.

With AARP’s endorsement, New York Life offers both a deferred and an immediate annuity option so that members at any stage of their lives can protect principal, and ensure that they will have an income that can be counted on in the future.

Over the past decade or so, fixed annuities, in particular, have become much more popular, due in large part to stock market volatility and 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, while AARP and New York Life offer strong arguments as to why the Secure Term Guarantee Annuity is beneficial, it is still important that you first weigh out all of the pros and cons before you move forward with a purchase. That way, you won’t have to worry about trying to get out of the annuity if you discover that it really isn’t the best option for you.

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. Neither AARP or New York 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 AARP Describes the Secure Term Guarantee Annuity from New York Life

AARP describes its Lifetime Income Program as one that will allow at least some savings to last a lifetime, thus providing added retirement security. The annuity is tailored to meet the needs of AARP members, offering retirement income that is guaranteed for life.

On AARP’s website, there is also information geared towards site visitors on how annuities work, ways in which an income annuity can be used, and various questions that should be asked before purchasing an annuity.

The Secure Term annuity can be purchased with an initial deposit of just $5,000 (or more) – but no additional amounts can be added over time. So, unfortunately, if you aren’t flush with a large sum of cash up front, then your income payment from the annuity is likely to be quite small. And, because your initial interest rate on the annuity is determined by the amount of your premium payment, the smaller the premium, the lower interest rate.

There is an interest rate guarantee period. This includes a choice of three, four, five, six, seven, or eight years of initial rate guarantee. However, once this guarantee period has ended, the rate could go up – or it could go down. In fact, each year after the initial rate guarantee period has ended, a new renewal rate will be incurred on the annuity’s contract anniversary. Members can then decide when to start receiving income from the annuity.

This group annuity offers a cash refund option that can ensure that the annuity holder, or their loved ones, get back at least the amount of money that was put in (and possibly more). This can occur while the annuitant is still living, or after he or she has passed away.

The AARP annuity can be purchased with many different types of assets, such as from savings or CDs, funds from an IRA, 401(k), 403(b). 457(b) or other types of savings plan. And, not only will the annuity holder’s savings be protected from market downturns, the annuity can make managing savings easier.

There are also some additional features offered on this annuity, such as a death benefit, a living needs benefit/unemployment rider, a home health care rider, along with some optional benefit riders such as an enhanced beneficiary benefit rider.

Unfortunately, though, while the Secure Term Guarantee Annuity from AARP may offer some nice features, the reality is that there are some potential drawbacks to going with this particular retirement savings and income plan.

For example, because it is a fixed annuity, the return is likely to be on the low side – which would be somewhere in the same range as a CD or money market – and because of that, the growth is not even going to meet, much less beat, inflation. This, in turn, can have a negative impact on your future income stream, and therefore, it could affect your overall retirement lifestyle.

In addition, in order to be eligible to purchase this particular annuity, you first need to be a member of AARP. Membership to AARP is open to those who are age 50 or older – and, while becoming a member of this organization can have its benefits, there is an annual fee to join.

What About the Fees on the AARP Secure Term Guarantee Annuity?

With regard to the fees on the AARP / New York Life annuity, there are no annual policy maintenance fees or policy administration fees. However, if you wish to withdraw funds during the annuity’s initial surrender period, then any amount that exceeds 10% of the contract value will be hit with a surrender charge.

The surrender charges on this annuity will correspond with the interest rate guarantee period. So in other words, if you choose an initial rate guarantee period of five years, then you would also incur surrender charges if you withdrew your money anytime during the first five full years of owning the contract.

AARP / New York Life Secure Term Annuity Surrender Charges

3 Years
Fee %
1
7
2
7
3
7
4 Years
Fee %
1
7
2
7
3
7
4
6
5 Years
Fee %
1
7
2
7
3
7
4
6
5
5
6 Years
Fee %
1
7
2
7
3
7
4
6
5
5
6
4
7 Years
Fee %
1
7
2
7
3
7
4
6
5
5
6
4
7
3
8 Years
Fee %
1
7
2
7
3
7
4
6
5
5
6
4
7
3
8
2

Independent Review of the AARP Secure Term Guarantee Annuity from New York Life

The Annuity Gator’s End Take on the AARP Secure Term Annuity from New York Life

Where it works best:

This annuity will generally work well for those who are seeking the following benefits:

  • Safety of principal
  • A set (albeit low) rate of return
  • A guaranteed rate – at least for a set number of years
  • Guaranteed income stream in retirement

Where it works the worst:

This annuity may not work so well for those who are:

  • Looking for a higher return
  • Want to access most or all of their annuity deposits within the first few contract years (depending on the interest rate lock/surrender charge period that is chosen)
  • Not looking for, or intending to use the lifetime income feature

Even given the information regarding the AARP Secure Term Annuity, it can be somewhat challenging to make an across-the-board determination in terms of whether or not certain investors will or won’t benefit from this annuity. The only way to really know if this annuity will work for you is to have it tested. We can provide that test for you 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 click here 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.

That being the case, the Secure Term annuity that is endorsed by AARP annuity could quite possibly be a nice addition to your retirement portfolio. However, it could also fall somewhat short – and quite honestly, there may be some better alternatives available to you. This is especially the case if you are looking for a lifetime income option, along with the opportunity to earn a higher return.

So, if you still have any additional questions or concerns about this annuity – or for that matter, any other annuity you may be considering – then please feel free to reach out to us through our secure contact form here.

Any Additional Questions About the Secure Term Annuity From New York Life? Did You Happen to See Any Mistakes?

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 Secure Term Annuity need to be corrected or revised, then please also let us know that and we will be glad to get right on it.

In addition, if there are any other annuities that you would like to see reviewed, just let us know, and our team of annuity geeks will get to work on those and have them on our website as soon as possible.

Best,

The Annuity Gator

Independent Review of the AARP Secure Term Guarantee Annuity from New York Life

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