Independent Review of the American General Power Advantage 10 Fixed Index Annuity
What’s Covered In This Review
In this review, we’ll cover the following information on the American General Power Advantage 10 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.
If you have been thinking about getting an annuity that can allow you to keep your principal safe, while at the same time also allowing you the opportunity to attain a nice, index-linked return on your money, then the American General Power Advantage 10 fixed index annuity may be a good vehicle for you.
However, before you dive right into this – or any other similar product, it is important to get a more in-depth understanding of how the product works, and how it may – or may not – end up working for you and your overall financial plans.
Throughout the past several years – and especially since the market and economic downturn of 2008 – annuities have become quite popular as a means for providing a guaranteed lifetime income stream in the future.
Because of this, the number of financial and insurance sales reps who are offering these types of products has also increased. This, however, is not necessarily a good thing. One reason for this is because, as the array of annuity features and benefits continues to expand, advisors may not always fully understand what it is that they are selling – and in turn, many consumers run the risk of expecting the product to act one way when in reality it won’t.
Therefore, digging into more of the product information before you make a commitment can help you to avoid the frustration – and the expense – of putting your hard-earned retirement savings into a product that really doesn’t fit your needs.
The good news is that the AnnuityGator specializes in providing annuity reviews, which can help you to either feel better about a purchase decision or in turn, avoid what could end up being a costly mistake.
Annuity and Retirement Income Planning Information that You Can Trust
If this is your very first visit to our website, then we would like to personally welcome you here to AnnuityGator.com. Here at Annuity Gator, we are a team of experienced financial pros who are intent on offering the most comprehensive and unbiased annuity reviews. We have been at this for a number of years now, and quite a bit longer than any of our competitors out there – and because of that, we’ve become a known and trusted source of annuity information.
If you’ve been seeking more information on how annuities work – and how they may work for you – it is likely, then, that you’ve come across many conflicting details about these financial vehicles online. This, however, is not entirely surprising, because there is a lot of confusion about these products – particularly as more products, riders, features, and benefits have come into being.
You may also have attended an annuity seminar in the recent past. While there, you may have been offered a free meal in exchange for allowing the presenter to discuss the American General Power Advantage 10 or some other similar product. Afterward, you may even have scheduled a time to meet one-on-one with an advisor in order to move forward with a purchase. That seminar or appointment may even have been the catalyst that eventually led you here to our website.
While there are many other sites on the Internet that provide annuity information to consumers, unfortunately, there are some that will attempt to lure you in by offering such bold claims like:
- Low Fees
- High Income Payouts
- Guaranteed Lifetime Income
- Top-Rated Annuity Carriers
Even though these features sound very enticing, it is critical that you find out just how many – if any – are true prior to moving forward with shifting a sizeable chunk of your retirement savings over to them.
In doing so, though, it may require you to wade through a plethora of annuity “small print” that could make getting a root canal more appealing.
But don’t worry – it won’t be that bad.
In fact, if you have arrived here at AnnuityGator.com with the intent of learning more about the American General Power Advantage 10 fixed annuity, then you have definitely landed in the right place (and we don’t use dental tools here)!
Even though there are other “copycat” websites that may look official, we dare say that right here on our site is the only place where you can get all of the details that you need – including both the benefits and the drawbacks.
Many insurance and financial advisors would paint a nice rosy picture of this – or any – annuity by focusing solely on the positive elements. One reason for this is because when they sell you an annuity, they get a commission.
But we believe that in order to truly make a well-informed buying decision – especially one that will require a large chunk of your retirement savings – then you need to know the bad, and the ugly, too!
Just so that we are clear, there are some significant advantages to owning a fixed indexed annuity – provided that this type of product fits nicely into your overall financial plan. So, given that, you not only need to know how these annuities work but also why you may end up choosing the American General Power Advantage 10 fixed annuity over a long list of other potential annuity options.
This annuity review is here in order to help you with getting a more in-depth understanding of all of this annuity’s fine print – as knowing this can help you in making a well-informed decision going forward.
So, if you are ready to get started, let’s go ahead dive in!
American General Power Advantage 10 Fixed Index Annuity
|Product Name||Power Advantage 10|
|Type of Product||Modified Single Premium Fixed Index Annuity|
|Standard & Poor's Rating||A+|
|Phone Number||(800) 445-7862|
Opening Thoughts on the American General Power Advantage 10 Fixed Index Annuity
American General Life Insurance Company initially began offering its products more than 160 years ago. Throughout that time period, the company has paid out in excess of $38 billion in claims and it has served more than 13 million customers. The firm is headquartered in New York City, NY.
The company has a long and vast history of providing both insurance and investment products across the U.S. – and it has built up a very wide and strong network of distributors. The mission of American General is to be the “premier provider of protection, investment, and income solutions that are needed for both financial and retirement security.” The company is highly committed to providing better and more innovative ways of helping their policyholders and clients protect their savings and financial security. Today, American General Life Insurance is a part of the AIG (American International Group) network.
Due to the constant ups and downs of the stock market – particularly over the past ten years or so – the demand for fixed index annuities has risen sharply. One reason for this is because these financial vehicles can provide you with the opportunity to obtain a nice return, while also keeping your principal safe – even in a downward moving market. These products can also provide you with an income stream in retirement that you cannot outlive. So, this sounds pretty nice so far!
But, while this may at first glance sound like the best of all worlds, it usually requires that you do a bit more digging so that you know the whole story before you buy. That’s because you don’t want to make a big financial commitment, only to find out too late that this just is not the product for you.
Before we get into the gritty details, here are some legal disclosures…
This is an independent product review, not a recommendation to buy or sell an annuity. American General has not endorsed this review in any way, nor do we receive any type of compensation for providing 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 negatives of this particular annuity. Prior to purchasing any type of investment or insurance product, it is important that you do your own due diligence and that you consult a properly licensed professional if you should 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 more information on how to compare annuities in order to determine which one may be right for you, click here to obtain our free annuity report.
How American General Describes the Power Advantage 10 Fixed Index Annuity
The American General Power Advantage 10 is a modified single premium deferred fixed index annuity. American General describes it as an annuity that can help you to:
- Protect principal from market downturns
- Grow your retirement assets with your choice of interest crediting options
- Accumulate more assets through the power of tax deferral
With no loss of principal and no loss of your earned interest, it can help you to also eliminate the emotional ups and downs that go along with equity related products in hopes of getting a good return (even though hope is not a strategy).
The annuity has four different crediting options that you can choose from, including:
- Annual point-to-point with the S&P 500 index/index interest accounts
- Annual point-to-point and 2-year point-to-point with the ML Strategic Balanced Index/index interest accounts
- Fixed Interest Account
Depending on your specific situation, you have the option of allocating your assets in a way that will serve you best – and, the allocations can be adjusted every year on the contract anniversary.
How a Financial Advisor May “Pitch” This Annuity
The American General Power Advantage 10 annuity can help you to both grow and protect your savings while allowing you the opportunity of a higher return than a fixed annuity or other low-interest paying vehicles.
Just like with other types of annuities, the Power Advantage 10 allows tax-deferred growth in your account. This means that there is no tax due on the gain in the account until the time of withdrawal – which could ultimately allow your money to grow and compound exponentially over time.
This annuity also offers a death benefit where the proceeds can pass directly to your designated beneficiary(ies) without having to go through the probate process. Your named beneficiaries will receive either the greater of your contract value – including applicable interest – or the minimum withdrawal value upon death.
Yet, while all of these features sound good so far, it is important to look a bit more closely at the annuity’s fine print so that you can get both sides of the story. For example, while you do have the opportunity to earn a nice return – especially when the underlying index has a positive year – this annuity is subject to an annual index rate cap. This means that if the cap rate is 4%, and the underlying index has a return of 6% in a given year, your return would be 4%.
Also, if you do happen to make any withdrawals that are in excess of the free withdrawal amount during the first ten years that you own this contract, you may be subject to a market value adjustment (or MVA). This adjustment may either increase or decrease the amount that you receive, and it is determined by a formula in the annuity contract.
What About the Fees on the Power Advantage 10 Annuity?
Just like most other financial products, there are various fees and charges that are associated with annuities. These include an up-front sales commission for the agent who sells you the annuity. There are also administrative and contract charges.
The American General Power Advantage 10 annuity will also have surrender charges if you withdraw more than 10% of the contract’s value within the first 11 years of owning the annuity. These are laid out as follows:
The Annuity Gator’s End Take on the American General Power Advantage 10 Fixed Index Annuity
Where it works best:
This annuity will typically work the best for those who are seeking:
- Safety of principal
- The opportunity for additional, index-linked growth
- Guaranteed lifetime income in retirement
Where it works worst:
- For people who need access to their money right away – or even during the first decade of owning this annuity
- For people who are not looking for guaranteed lifetime income
In order to really know how to compare the best annuity for you and your specific needs, click here to download our free report on annuities.
With continued concerns about market volatility and low-interest rates, consumers are seeking financial products that can help them to protect their principal, while at the same time ensuring that their income in retirement will last throughout their entire lifetime. This is possible with a fixed index annuity like the American General Power Advantage 10.
However, there are still a wide array of criteria that need to be considered if you are trying to determine which – if any – annuity is right for you. In all cases, an annuity should be considered a long-term financial vehicle, and the money that is used for purchasing this product should not be an amount that you may need for another issue soon after making your annuity purchase.
The only way to really know if the American General Power Advantage 10 annuity is right for you is to have it tested. We can also walk you through the American General Power Advantage 10 fixed index annuity calculator. By plugging in figures that best represent your specific scenario, we’ll run the numbers for you and provide you with a free, no obligation spreadsheet with the results.
When thinking about the purchase of a fixed indexed annuity, you can be secure in knowing that your money is safe from market ups and downs and that you can have an ongoing lifetime income in retirement.
With regard to the American General Power Advantage 10 fixed index annuity, there are no doubt some nice features. But, quite frankly, this annuity could also fall somewhat short. With that in mind, there may be some better alternatives out there for you.
If you do have any questions regarding how this annuity may fit in with your specific savings and future income goals, then please feel free to reach out to us here through our secure contact form.
Have Any Other Questions? Did You Notice Any Mistakes on this Review?
We understand that this annuity review was a bit on the lengthy side. But, even so, we would much rather provide you with “too much” information that with not enough. So, if you did happen to find this annuity review helpful, please feel free to forward it on to anyone else that you think may benefit from it. Likewise, if you found this review to be confusing, or if reading through it generated any additional questions or concerns, then please let us know that, too.
In addition, because information about annuities can change quite regularly, it is possible that some of this information is outdated, or may need to be revised. That being the case, if you found a mistake or any details that need to be revised, just give us a shout.
Are there any other annuities that you would like to see reviewed?
No problem! If so, please let us know the name of the annuity, or annuities, that you are interested in seeing.
The Annuity Gator