This is NOT your parent's or grandparent's annuity

Most people cringe when they hear the word annuity.

Bob Lindquist, founder of Safe Retirement Strategies, went in studio with KMBZ's Dan Weinbaum to set the record straight.

Some of that misconception stems from confusion between fixed index annuities and variable annuities which are radically different.

A variable annuity is a tax-deferred retirement vehicle that allows you to choose from a selection of investments, and then pays you a level of income in retirement that is determined by the performance of the investments you choose.

In stark contrast, a fixed index annuity is a tax-favored accumulation product issued by an insurance company in which the annual growth in your account is bench-marked to a stock market index like Nasdaq, the NYSE and the S&P 500. And unlike variable annuities it provides a guaranteed payout.

“People get themselves all worked up thinking that maybe these insurance companies will guarantee income for a period of time but as soon as the contract is over at death, the insurance carrier keeps all the money remaining in your account. That is not at all how this works,” said Lindquist. Actually, all remaining funds are distributed to your loved ones.

He reminded listeners that in 2008 many investors lost 30 to 40 percent of their life savings. When you’re about to retire you don’t have time to catch up from a catastrophic loss like that.

Lindquist recommends fixed index annuities because they protect your life savings from the downside of the market and grow your money safely regardless of swings in the stock market. “You lock in gains as your money grows every year and never expose the original principal and gains to market risk again,” he said.

In addition, fixed index annuities from Safe Retirement Strategies provide you with a guaranteed stream of income for the rest of your life just like Social Security and pensions. This frees you up to enjoy your retirement without having to worry about outliving your money.

For your introductory guide to fixed index annuities call Bob at 913-814-9600.