What will be covered in this review?
In this review of the Lincoln Impact Advantage Fixed Indexed Annuity we will be going over the following information:
- Product type
- Current rates
- Realistic long-term return expectations
- How this annuity is best used
- How it is most poorly used
- How it is offered and sold to customers
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 purchasing an annuity so that you can attain tax-deferred savings, as well as a guaranteed lifetime income in retirement, then the Lincoln Impact Advantage fixed indexed annuity may be a good choice for you.
But, before you run out and commit to this annuity – or to any annuity, for that matter – it is highly recommended that you first attain a good understanding of how the annuity works, and how it may (or how it may not) work for you.
Throughout the past several years, the fixed indexed annuity, in particular, has become extremely popular. This is because a fixed indexed annuity, or FIA for short, can essentially offer the best of both worlds…or at least it can appear that way.
That is because these annuities provide the opportunity to receive positive growth when an underlying market index is being tracked and performs well, while also protecting your principal if the underlying index performs poorly.
As an extra added benefit, fixed index annuities can also provide the ability to receive a guaranteed income for the remainder of your life (as well as that of a spouse or partner, if applicable) – regardless of how long that income may be needed.
However, due in large part to the increased number of new-fangled products that are being pushed out into the market place by insurance companies – each of these trying to outdo the other – these particular annuities can also be extremely confusing.
So, this can make it even more essential that you read over all of the fine print before you commit what could be a large percentage of your savings to this annuity. Otherwise, it could cost you a substantial amount to get out of it down the road.
Annuity and Retirement Income Planning Information You Can Trust
If this is your first visit to our website, we would like to first formally welcome you to Annuity Gator. We are a team of annuity professionals who have a key focus on offering comprehensive – yet non-biased – annuity reviews online.
We’ve been at this for quite a long time now, and far longer than our competitors have – although many of them would like to have you think otherwise. Due to our experience and longevity in this arena, we have become very good at what we do, and we’ve actually come to be known as a trusted source of annuity information.
If you’ve been reviewing annuities on the Internet, it is possible that you have come across some highly conflicting information about these products. This, however, isn’t really all that uncommon, as there are many different annuities and many different thoughts about them.
It could also be that you have recently attended an annuity seminar where, in return for a free dinner or lunch, the presenter had your attention while he or she described how the Lincoln Impact Advantage fixed index annuity (or some other similar annuity) operates. In fact, it may even have been your attendance at that seminar that has ultimately led you here to our website right now in search of additional details.
When doing your annuity research, though, you may have run across some of the other websites out there that discuss annuities – but that are much more interested in obtaining your contact information rather than educating you about these products.
In order to obtain your name and other contact information, they will oftentimes attempt to “lure” you in by making some outrageous claims about the annuities that they offer, such as:
- High income payouts
- Guaranteed lifetime income
- Top-rated carriers
- Lowest fees
As nice as these types of claims might be, you really need to check out as much information as you can before committing to a long-term financial vehicle like an annuity, because things are not necessarily always as they seem.
In any case, if you’ve been seeking more information about the Lincoln Impact Advantage, you are in the right place. In fact, dare we say that our Annuity Gator site is the only place online where you can obtain all of the information that you require for making a well-informed purchasing decision about this annuity.
Before we get too far into this review, we do want to be perfectly clear in stating that we believe that annuities can be a very viable financial option for some people – provided that they fit in with your other short- and long-term financial goals.
So, if you’re ready to begin this review, let’s go ahead and dive in!
Lincoln Impact Advantage Fixed Index Annuity at a Glance
|Product Name||Impact Advantage|
|Issuer||Lincoln Financial Group|
|Type of Product||Fixed Index Annuity|
|A.M. Best Rating||A+|
|Phone Number||(888) 916-4900|
Opening Thoughts on the Lincoln Financial Impact Advantage Annuity
Lincoln Financial Group has been in the business of offering insurance and financial tools to its customers since 1905. Over the past 110+ years, the company has grown and expanded, and today it comprises a well-organized family of companies that continue to base their business on dependability, honesty, and customer service.
This group of companies consists of the following entities:
- Lincoln National Life Insurance Company (Fort Wayne, Indiana)
- Lincoln Life and Annuity Company of New York
- Lincoln Financial Distributors
- Lincoln Financial Advisors
- Lincoln Financial Securities Corporation
- Lincoln Financial Foundation
Lincoln has amassed a long list of awards and accolades over the years, such as being named as #205 on the 2018 Fortune list by revenue, listed as #24 by assets and #316 on the 2018 Barron’s 500 list based on the most revenue growth and cash returns.
Based on its financial strength and claims paying ability, Lincoln Financial Group has also earned high ratings from the insurer rating agencies. These include an A+ from A.M. Best, an A+ from Fitch, an A1 from Moody’s, and an AA- from Standard & Poor’s.
Due in large part to the constant ups and downs of the stock market, along with the fact that (on average) people are living longer today than ever before, fixed annuities have become much more popular over the past decade or so. One key reason for this is because these financial vehicles can provide you with safety of principal and a steady rate of growth (regardless of the market or economy), as well as a future income stream that will last as long as you need it to.
But, while this may at first glance seem like an ideal way to go with your savings, if something sounds too good to be true, it typically is! Therefore, it is essential that you go over the “fine print” before you move forward with the purchase.
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. Lincoln Financial Group 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 the Lincoln Describes the Impact Advantage Annuity
The Lincoln Impact Advantage annuity is described as a financial vehicle for risk-averse high net worth individuals who are seeking tax-deferred growth, a higher degree of upside potential, and protection from market losses.
The amount of premium that you can add to this annuity is $2 million (without prior approval), but in some cases, contributions of more may be allowed.
To learn more about the Impact Partnership and the Lincoln Impact Advantage annuity go HERE.
The Impact Advantage annuity from Lincoln Financial is actually offered in conjunction with the Impact Partnership, a leading distributor of annuities, and a key distribution partner for many of the top annuity and life insurance companies in the U.S.
This annuity offers a variety of ways to grow your funds, and can be essentially “customized” for you, based on your objectives and tolerance for risk. For instance, there is a fixed account, as well as two interest crediting strategies that are tied to the S&P 500 index, one tied to the S&P 500 Daily Risk Control 5% Index, and another one that is tied to the Balanced Capital Strength 6 Index.
The growth strategy can be geared to your specific needs. For instance, the <2-year Balanced Capital Strength 6 indexed account seeks to provide upside return potential by dynamically adjusting its allocations to stocks of well-capitalized U.S. companies and a diverse range of U.S. fixed income markets.
To see the list of index options for the Lincoln Impact Advantage go HERE.
It is important to note, though, that you won’t necessarily be able to match the amount of growth that your annuity returns with the amount of growth that actually takes place in a given underlying index that the annuity is tracking. One reason for that is because, depending on the particular strategy that you choose, there may be a “cap,” or maximum, amount of growth allowed.
As with other annuities, the Impact Advantage annuity provides you with several different alternatives for taking income. This includes an option for receiving income from the annuity for the rest of your life, regardless of how long that may be.
There are also some added “bells and whistles” on this annuity, such as access to your funds in the event of any unexpected expenses, as well as a death benefit that may be paid to a named beneficiary.
For example, with the nursing home rider, surrender charges will be waived if the owner or joint owner of the annuity is confined to a nursing home or a special nursing unit of a hospital for at least 30 consecutive days.
Likewise, if after the first contract anniversary the owner or the joint owner of this annuity is diagnosed with a qualifying terminal illness that renders a life expectancy of 12 months or less, any applicable surrender charges will also be waived if funds are accessed from the annuity.
To learn more about the features of the Impact Advantage annuity from Lincoln Financial Group, go HERE.
How a Financial or Insurance Advisor Might “Pitch” the Lincoln Impact Advantage Annuity
As interest rates in the U.S. continue to remain low, it can be difficult at best to secure a good return on your money without having to incur more risk as a “tradeoff.” But because the Lincoln Impact Advantage is a fixed indexed annuity, you can take advantage of the upside of the index(es) being tracked, but without having to incur loss when the market goes down.
Plus, when the time comes for you to turn on the income stream, you could choose an option that ensures you won’t run out of money in the future, no matter how long you may need it to keep flowing in.
This “best of all worlds” scenario is likely that an insurance or financial advisor would focus on when presenting this annuity to his or her clients. But it’s really important to be careful here, as a jack of all trades is oftentimes a master of none.
With that being said, while you can definitely achieve a higher rate of growth than you could with a regular fixed annuity, the fixed indexed version will typically “cap” that growth. That means that, even if the underlying index being tracked has a stellar year, you will only be able to participate in a certain percentage of it.
Plus, even though insurance companies will oftentimes exclaim that their annuities are “liquid,” this is not the case, at least entirely. That’s because you will find a surrender charge if you decide to withdraw more than 10% of your contract value during the annuity’s surrender period. With that in mind, be sure that you are aware of how long you will have to have your money “locked in.”
What About the Fees on the Lincoln Impact Advantage Annuity?
Annuities have long been known for the fees that they charge. So, just like any other product or service that you are considering the purchase of, you need to know just exactly how much it will “cost” you – and what some of the tradeoffs may be.
In the case of the Lincoln Impact Advantage, there are surrender fees incurred if you withdraw more than 10% of the contract value during the surrender period. Depending on whether you opt for the 10-year or the 7-year guarantee period, the surrender charge schedule will correspond. So, for instance, you could face penalties for seven or ten years if you withdraw more than 10% of your funds from this annuity during the “surrender period.”
Lincoln Life Impact Advantage Annuity Surrender Charge Schedule
On top of a potential surrender charge, if you withdraw funds from the annuity before you reach age 59 ½, you could also incur an additional 10% “early withdrawal” penalty from the IRS.
The Annuity Gator’s End Take on the Lincoln Impact Advantage Fixed Index Annuity
Where it works best:
Although this annuity may not be ideal for everyone, it could be a nice option if you are seeking the following features:
- The option for market index-linked growth
- Protection of your principal
- Guaranteed income in retirement
Where it works the worst:
The Impact Advantage fixed index annuity from Lincoln may not, however, work very well in all situations. This is especially the case if you:
- Want or need to access more than just 10% of your money during the surrender period
- Do not plan to use the lifetime income feature on the annuity
When thinking over the purchase of an annuity, it is critical that you consider a long list of factors and financial probabilities for your specific situation. These should ideally include the annuity’s options for growing your money, as well as the way that it keeps your principal safe. And, because many people purchase annuities for the purpose of receiving long-term income, this too is extremely important.
If you are still leaning towards purchasing the Lincoln Impact Advantage fixed index annuity, you can rest assured that your money will be safe, no matter what happens in the market. You can also count on a lifetime income in the future.
Yet, even with all of the awesome benefits that this annuity can provide you with, there could still quite honestly be a better option out there for you. With that in mind, it can be extremely beneficial to have this annuity tested, based on your specific parameters.
Have Any Additional Questions? Did You Notice Any Mistakes on This Annuity Review?
We know that this annuity review was a bit on the long side – and for that, we truly thank you for sticking with us through to the end here. Our feeling is, though, that we would much rather provide you with a tad bit “too much” information about these products that not provide you with enough.
Therefore, if you felt that this annuity review was helpful to you, then please feel free to share it and forward it on to anyone else that you think might also benefit from it. Likewise, if this review posed even more questions, then please let us know that, too.
Are there any other annuities that you would like to have us review on our website?
There is a long list of annuity products out there in the market place today. So, if there is one (or more than one) that you would like to have us review, then please let us know the name, or names, of the annuity, and our annuity “geeks” will get to it ASAP.
Thank you for visiting our AnnuityGator.com site, and be sure to check back often for new and updated information regarding all things annuity.
The Annuity Gator
P.S If you would like to read more of our Lincoln annuity reviews here are some links to check out:
- Independent Review of the Lincoln Financial MYGuarantee Plus Fixed Deferred Annuity
- Independent Review of the Lincoln National Covered Choice 5 Annuity
- Independent Review of the Lincoln National Lincoln OptiChoice Fixed Index Annuity
- Independent Review of the Lincoln National Life ChoicePlus Assurance Fee-Based Variable Annuity
- Independent Review of the Lincoln ChoicePlus Assurance Variable Annuity
- Independent Review of the Lincoln National Life Core Income Built with iShares Variable Annuity
- Independent Review of the Lincoln Financial Lifetime Income Edge Fixed Index Annuity
- Independent Review of the Lincoln American Legacy Variable Annuity
- Independent Review of the Lincoln Life Insurance Company’s Level Advantage B Share Annuity
- Independent Review of the Lincoln National Life Level Advantage Advisory Indexed Variable Annuity