Independent Review of the AIG Choice Index 10 Annuity
What’s Covered In This Review
In this review, we’ll cover the following information on the AIG Choice Index 10 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.
Considering an annuity – or any type of financial product or service – that can offer you principal protection, along with a lifetime income in retirement, is a big decision. So, if you are thinking about a product that will provide you with the ability to enhance your returns, while at the same time keeping your principal safe – and paying out a lifetime income stream in retirement – then the AIG Choice Index 10 annuity could be a good option for you.
However, prior to moving forward with purchasing this annuity, it is important to have a good understanding of how the product works, and how it may – or may not – fit into your overall financial situation once you have a more thorough idea of its inner workings.
Annuities have been becoming more popular, especially over the past decade or so, as a way to ensure guaranteed lifetime income. These products can make it easy for you to make premium deposits, as well as to ensure that you won’t run out of money in the future. But, even though this can be reassuring, the reality is that annuities are long-term financial commitments that can often have surrender penalties if you want to withdraw your funds early. With that in mind, it is important to know just exactly what it is that you are getting into.
But, truly understanding the inner workings of an annuity can be difficult. This is because annuities tend to be somewhat confusing. They typically have many different “moving parts,” and there can also be a great deal of small print when it comes to delving into the product literature.
Plus, what can often times actually add the most confusion has a lot less to do with the annuities themselves, but rather the way in which these products are presented to consumers. This is where we can help.
Annuity and Retirement Income Planning Information that You Can Trust
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and nonbiased annuity reviews that can be found on the Internet today. We have been doing this longer than any of our competitors.
If you have been seeking out information on annuities online, or even if you have heard friends and family discussing these products, it is likely that you have encountered some conflicting information about them. This is easy, as there is a lot of confusing information about annuities out there.
Plus, even though there may be a lot of very great websites on the Internet that are focused on marketing their annuities, some of these sites may try to lure you in so that you give them your contact information by making promises like the following:
- Guaranteed lifetime income
- Lowest fees
- Top-Rated Annuity Companies
- Highest Income Payouts
- Fast, Easy Annuity Quotes
However, while these claims may sound great initially, the truth is that they may or may not actually be all that they are cracked up to be. If you want to find out, then you’ve come to the right place – and we dare say, likely the only place – where you can actually find out if that’s so.
Insurance and financial sales people who are offering annuities will often do their very best to provide a rosy picture of how safe these products are. But, what they will often neglect to say is that there are also still some drawbacks to owning fixed indexed annuities, too – so this means that you need to know all of the potential angles prior to putting down your hard earned retirement dollars into one.
This isn’t to say that what these agents are trying to sell you is a bad thing. But, what it does mean is that as you approach retirement, and as you determine what you should do with the money you have saved up over the years, you should know and understand exactly what you are purchasing with it – and why.
This annuity review is here to provide you with a deeper understanding of all of the details on the AIG Choice Index 10 annuity so that you have the knowledge that you need regarding whether or not it will be the right choice for you.
So, if you are ready to get started, let’s go ahead and dive in!
AIG Choice Index 10 Annuity
|Product Name||Choice Index 10 Annuity|
|Type of Product||Fixed Index Annuity|
|Standard & Poor's Rating||A+|
|Phone Number||(800) 888-2452|
Opening Thoughts on the AIG Choice Index 10 Annuity
AIG has been offering retirement and insurance solutions for nearly 100 years. The company was initially founded in China, and it quickly spanned the globe. While it has had some ups and downs, the company has an extremely strong and stable financial foundation. It also has a very good reputation for paying out its policy holder claims.
The company has been given very high ratings from the insurance company rating agencies, which include an A from A.M. Best, an A+ from Standard & Poor’s, an A2 from Moody’s, and an A+ from Fitch.
Today, one of the biggest fears on the minds of retirees, as well as those who are on brink of retirement, is the potential for running out of money at a time when they need it the most. Because of that, many investors are looking for a place where they can achieve a nice return, while at the same time, keep their savings safe. A fixed indexed annuity can offer that solution.
However, while this may, at least initially, sound like the best of both worlds, the reality is that you should still do a fair amount of research on a fixed indexed annuity, just as you would do if you were planning to move forward with any other big ticket purchase.
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. AIG 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 AIG Describes the Choice Index 10 Annuity
According to the AIG website, the Choice Index 10 annuity can allow you to “generate a predictable income stream for retirement while avoiding the risk of losing principal in a down market.”
The annuity offers several additional riders which can guarantee lifetime income – which in turn, can assist you with better planning your finances during retirement. The key benefits of this particular fixed indexed annuity include:
- Potential for growth
- Guaranteed income for life
- Your choice of index accounts – which include the S&P 500 and the ML Strategic Balanced Index
How a Financial Advisor May “Pitch” this Annuity
The AIG Choice Index 10 annuity is a fixed indexed annuity that can help you to ensure that your portfolio is safe, yet also offers the potential for a higher return than that of a regular fixed annuity alternative.
In addition, this particular annuity offers additional riders that can help you to potentially generate more income for life. These include the following:
- Lifetime Income Plus – With the lifetime income plus rider, your income base – the amount from which lifetime withdrawals are calculated – is guaranteed to rise by up to 7 percent for the first ten contract years. In addition, it also has the potential to double if no withdrawals are taken until the tenth contract anniversary.
- Lifetime Income Plus Multiplier – The lifetime income plus multiplier living benefits rider offers the potential for rising income, based on any interest earned in your annuity. Prior to starting your withdrawals, your income base can grow by an annual income credit that equals the interest credited rate – if any – multiplied by 250 percent.
But, while the points above may make this annuity sound ideal for many people, it is important to read the “fine print”, as these benefits can often times come at a significant cost. For example, the optional living benefit rider will cost an additional annual fee of 0.95 percent of the income base.
A fixed indexed annuity, for instance, will typically have a “cap,” above which you will earn no additional return. This means that if the underlying index has a stellar performance during a given year, your annuity will only be credited with a return up to the capped amount.
There is also some small print on the Choice Index 10 annuity’s options riders. For example, with regard to the lifetime income plus rider, the income base actually has no surrender value, and it is solely used for calculating the lifetime withdrawal amounts guaranteed by the rider and the rider’s fee.
Likewise, there is also some “fine print” with regard to the lifetime income plus multiplier, the interest credited rate is the rate of interest that you earn on your interest crediting options. It will be adjusted for provisions such as index rate caps, participation rates, and spread, that may reduce or limit the amount of interest that is earned. So, it is important to understand that, in a year when no interest is earned or a withdrawal is more than the income credit, no income credit will be applied to the rider’s income base for that year. If you want to add either of these riders to your annuity, there is a cost of 0.95% of the income base taken as a fee.
There is a lot of information to consider when you are looking into purchasing an annuity. So, if you are not completely sure whether or not the AIG Choice Index 10 annuity is for you, and/or you would like to get answers to any additional questions that you have, then please feel free to reach out to us here through our secure contact form.
We understand that annuity products can be quite confusing – and especially those annuities that have many moving parts on them. So, even as a well-educated consumer, you may have many questions or concerns.
If you would like to have some additional, more in-depth information, along with the assurance that you know what it really is that you are purchasing, click here now to download our free report on what you need to know prior to purchasing an annuity.
What About the Fees on the AIG Choice Index 10 Annuity?
In addition to knowing how your money may perform when it is in a fixed indexed annuity, it is also very important that you have a good understanding of the fees that you may be charged. This is because these additional charges can really start to add up – both during the time you are accumulating money in the annuity, as well as throughout the time that you are receiving your income stream.
Just some of these charges can include an up-front sales commission that will go to the sales agent who sold you the annuity. There can also be contract and administrative charges that can eat away at your funds.
As with other types of annuities, the AIG Choice Index 10 will also subject you to a surrender penalty if you decide to take a portion (or all) of your money out of the annuity during the first ten years of owning it.
For example, with the Choice Index 10, the surrender charges are assessed as follows:
The Annuity Gator’s End Take on the Choice Index Annuity from AIG
Where it works best:
This particular annuity will generally work the best if you are looking for:
- The opportunity to obtain a higher rate of growth
- Safety of principal
- Lifetime income
Where it works worst:
Conversely, this annuity may not work out so well for those who:
- Want to fully participate in market gains
- Need or want access to most or all of their capital within the first full 10 years
- Do not intend to use the guaranteed lifetime income feature
There are many factors that need to be considered when you are thinking about the purchase of an annuity. Overall, for instance, annuities should always be considered as a long-term endeavor – and because of that, these vehicles will generally be more appealing to those who are seeking retirement income in the future and also to those who may be working to build up as much as possible in order to generate that future income stream.
While this particular annuity does provide some nice features such as the opportunity for enhanced growth and the protection of principal, it may very well fall short – especially in comparison to some of the other alternatives that are available in the market right now.
Therefore, if you still have any unanswered questions or concerns about the AIG Choice Index 10 Annuity – or even if you have a question about any annuity – then please feel free to reach out to us via our secure contact form here.
Have Any Questions on the AIG Choice Index 10 Annuity? Did You Find Any Mistakes in this Annuity Review?
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Also, as humans will sometimes do, we all tend to make some mistakes. So, if you happened to notice any while you were going through this annuity review, then please let us know. We are always more than happy to make any corrections and to give credit where credit is due. If you are an investor and this review causes you any confusion and/or if it creates any additional questions, then please reach out to us as well. While we are not always able to get back with you right away, we can usually clear up any questions within a day or two.
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