2022 Suze Orman and Fixed Index Annuity

2022 Suze Orman and Fixed Index Annuity

Contact Us


If you would like to talk with our firm to learn more about the specific FIAs available in the market today and how they can help you with your retirement planning, please click here to email us or phone 1-813-964-7100.

To sign up for a free consultation or to just get more information click here.

2022 Suze Orman and Fixed Index Annuity

Suze Orman has been singing the praises of indexed annuities to shield your retirement nest egg from market volatility for some time. In her 2001 book, “The Road to Wealth,” Suze Orman tells readers that “if you don’t want to take risk but still want to play the stock market, a good index annuity might be right for you.”

“In my world, annuities really sell for four things and the acronym is PILL.  P stands for principal protection. I stands for income for life. L stands for legacy, and the other L stands for long-term care. If you don’t need to fall for one or more of those issues, then you do not need an annuity, period,” says Michael Minter, managing partner of Mintco Financial.

As most people approach retirement, they begin to think about ways to protect their nest egg from loss.

Stock market swings can cause retirement accounts to drop in value.

Then, people may begin to wonder if their money can bounce back.

Often, the additional risk associated with the stock market becomes less appealing as people age.

There are ways to keep your principal safe.

There are some products that provide protection of principal even when the market drops.

Now, of course, keeping a larger portion of your money safe becomes more important as you get older.

With fewer years available to recover from potential market loss, retirees often change their plans as they get older. But thankfully, retirees now have several ways to keep their money protected from market loss.

This includes certain fixed indexed annuities (or FIAs) and life insurance products.

Regardless of where you are on your road to retirement, like most people you want to protect your hard-earned money and see it grow.

But in today’s low-interest-rate environment, safer investment products like CDs, money markets, and bonds may not provide the growth potential you need for retirement planning. You can turn to the stock market, but that might mean taking on more risk than you’re comfortable with.

What if you could have both protection and growth from a single core portfolio investment?

You can, with a fixed indexed annuity.


What Is a Fixed Index Annuity (FIA)?

A Fixed Index Annuity is another attractive option for those who enjoy participating in the stock market but cannot afford to lose any of their principal.

Do Annuity Rates Change Each Year During a Contract?

With traditional fixed annuities, you cannot make any changes to your annuity for the length of the contract. If you start a 5-year contract at 4%, you are guaranteed that 4% return for the entire 5 years.

On the plus side, you have complete certainty about what your returns will be, but if rates do go up during your contract, you’re stuck with whatever the rate was when you started your annuity.

With a Fixed Index Annuity (FIA), you can make changes to your game plan every year.

You can move some of your funds to a different index crediting strategy or even a fixed account!

The flexibility to reallocate your funds and try to take advantage of better rates makes Fixed Index Annuities a great choice for many retirees.

Annuities are a great avenue for most retirees and seniors with nest eggs or funds they don’t have plans for in the near future.

Unlike the stock market, annuities offer safety, but unlike the banks, they offer competitive interest rates.

If you think annuity rates might go up, consider looking at a Fixed Index Annuity, which allows you to capture more gains when the markets are doing well. You can also change your game plan every year, which offers flexibility.

Why People Choose Annuities – 2022 Suze Orman and Fixed Index Annuity

Principal Protection

Two types of annuities (FIAs and Fixed Annuities) offer you principal protection. Both of these products are essentially contracts between you and the insurance company. The insurance company agrees to provide protection of your money in the terms of this agreement. Just like the FDIC insures savings accounts in banks, insurance companies protect money in an annuity. However, with regular bank savings, the FDIC only insures up to 25,000. Annuities, by contrast, may allow you to deposit much higher amounts. Depending on your situation, of course.

Rate Of Return

Another reason to consider annuities over savings is the rate of return. Most bank accounts yield a less than desirable return. On top of that, any interest you earn is taxable each year. But with a fixed annuity or FIA, your money can grow, tax-deferred. You do pay taxes when you take the money out, but before that time, your money can accumulate without a tax event. In addition, some people take a regular monthly income from their annuity.

Make a game plan.

Before you start moving your money around, make a game plan.

You’ll need to determine when you’ll need your funds and how much you’ll plan to use.

When you’re considering an annuity, look for one with free withdrawal privileges, so you can access some of your funds without a penalty.

Most annuity plans allow you to withdraw a portion of your funds after the first year with no early withdrawal penalties. If you have any financial commitments coming up in the next 12 months, hold that money back for now.

Put the rest of your funds in the plan so it can begin earning interest.


Would I have the flexibility to access my money if I need it?


Fixed indexed annuities are designed to be used as long-term conservative investments that can act as the anchor to a financial plan.

However, if you need to withdraw money, you can. Keep in mind, however, that depending on how much you take out and when you may incur penalties and/or fees.

These can vary by product and state.


How will a fixed indexed annuity affect my taxes?

Annuities are tax-deferred investment vehicles.

You pay no taxes on any interest you earn until you make a withdrawal, so more of your money stays invested, any interest credited can continue to compound, and your assets may accumulate faster than with taxable investments like CDs.


Is there a death benefit?

All fixed index annuities include a death benefit. This benefit allows you to select a beneficiary who will receive the remaining balance in your account at the date of death. The death benefit often takes the form of a lump sum payment.

Which index will this product track? 

Remember: when you buy a fixed index annuity, you are not purchasing actual shares or stocks in a company.

You are making an agreement with an insurance company that, in exchange for allowing them to hold your principal for a certain number of years, you will receive an annual return derived from the performance of one or more stock market indexes.

What are the tax benefits and burdens associated with this product?

One of the major benefits of a fixed index annuity is its tax-deferred status. This means that during the accumulation phase when your investment is growing in value, you do not pay taxes on any earnings. If it’s a personal savings account, only the interest is taxed when you make a withdrawal.

However, with an IRA, the full withdrawal will be taxed since this money was not taxed previously.

You should also work with your advisor to avoid IRS penalties on withdrawals and required minimum distributions.

How Fixed Index Annuities Can Help With Healthcare Costs

How can a fixed index annuity help you with health costs, specifically certain long-term care expenses? Nowadays, many fixed index annuity contracts come with a provision called a wellness benefit.

In some situations where you need certain kinds of long-term care, the income from your annuity can be “enhanced” for a certain time. Your annuity income can increase, often double, to help you pay for long-term care and its high costs.

This enhanced income generally lasts for a certain period, such as up to 60 months (or five years). The benefit can vary from an indexed annuity contract to contract, so your financial professional can go over the details, pros, and cons of any contracts you may be considering.

Fixed index annuities with wellness benefits, life insurance with accelerated benefits, and asset-based long-term care policies are just a few insurance-based options at folks’ disposal. Let’s talk more about fixed index annuities and the wellness benefits.

How Do Wellness Benefits Work?

Fixed index annuities with wellness benefits can increase your annuity payout by a factor of two, or sometimes even more if you come to need this type of care. It effectively doubles or triples your payout for your long-term care need.

This form of financial protection is often less expensive than long-term care insurance. What if you don’t use the wellness benefit? Then you can still receive a “return” on your annuity money with other benefits, such as a lifelong income stream or a death benefit for loved ones.

More On Using Wellness Benefits For Long-Term Care

One important note is that a wellness benefit isn’t a long-term care benefit per se.

However, it does provide you with a higher payout if some form of long-term care is needed. Your situation also must qualify for this income “doubler” or “enhanced income” to be triggered.

For example, many fixed index annuity contracts require someone to be confined to a nursing home for a certain number of days in order to qualify for this. However, some contracts permit it for certain home healthcare situations as well.

The amount and scope of the benefit vary from one insurance carrier and annuity product to another. So, you can shop around to see who is offering the most generous benefits.

When Does the Wellness Benefit End?

Generally, the wellness benefit will pay the increased income until 1) the contract value is depleted, or 2) a certain amount of time has passed, such as after two to five years.

Once this happens, the payout will generally go back to its original amount. For example, say you buy a $100,000 annuity that will pay you $500 a month for the rest of your life. If you then go into a nursing home, the payout will increase to $1,000 or maybe $1,500 per month until the insurance carrier has paid out $100,000 of income.

If you are still living after your contract value has been depleted, then your payout will revert to the $500 a month you were receiving before.

Planning For Long-Term Care Expenses

In most cases, this type of annuity won’t pay enough income to completely cover the cost of many types of long-term care. But they can greatly help reduce the amount of money that you would otherwise have to come up with on your own each month.

There are different pros and cons to various annuity products and how they let you use this wellness benefit.

Don’t be afraid to ask any questions that are on your mind and take your time to decide about what annuity may be right for you.

Also, the annuity should ideally do more than just give you long-term care protection.

You might tap the annuity for a guaranteed income stream, use it to protect crucial savings from market risk, or have it pass on a death benefit to heirs.

No matter what, the annuity needs to solve specific gaps in your retirement plan, just as all other financial products should do.

Consider A Fixed-Indexed Annuity – 2022 Suze Orman and Fixed Index Annuity

Many people decide to roll over their 401(k) to an IRA, but there are many reasons you should consider rolling it over to a Fixed-Indexed annuity instead. Fixed-Indexed annuities are becoming more widely used in financial services and contract with insurance companies. Some features of fixed-indexed annuities include:

  • Your principal is protected during a down market. You will not lose your initial principal or accumulation despite market conditions.
  • Grow on a tax-deferred basis.
  • The return is based on an index (ex. The S&P 500), which grows the annuity’s value over time.
  • Fixed-Indexed Annuities provide a guaranteed lifetime income and protection against longevity risk and you receive annuity payments for life.


Tips To Ensure a Smooth Transition

If you decide to roll over your 401(k), take note of these tips. They can help ensure a smooth transition of your retirement account’s assets:

  1. Check with the custodian of your retirement account to ensure a rollover is possible due to the time the account has been open, associated transfer fees, and if you can move out of the plan while still employed.
  2. Ask for all transfer out paperwork from the custodian (fund company) and if additional signatures or a ‘signature medallion stamp’ will be required on the paperwork to complete the transfer.
  3. Include a statement from the account that includes your name and address, the account number(s), and is less than six months old.
  4. Realize that you have options of where you transfer this account to and the type of annuity.  Discuss your options with your insurance representative.
  5. Understand the fees associated with transferring your money to an annuity. Your financial professional will explain these fees to you during the rollover meeting as you review the paperwork.
  6. Be patient. Some fund custodians process transfers very slowly.  Ask your financial professional to keep in touch with you regarding the progress of the transfer.  If you are unsure that the transfer has been completed in a month, check-in with them.


Fixed Benefit of An Annuity – 2022 Suze Orman and Fixed Index Annuity

Lastly, determine if you would like to consider a fixed-indexed annuity as a suitable option for you. An annuity provides a fixed benefit for a specified period. It can be a retirement income strategy based on your portfolio’s other investments.

If you have questions regarding annuities, please contact our office. We can show you how they can be a part of your retirement income strategy.

Product changes

There are several different FIAs with guaranteed income riders in the marketplace.

These products change periodically and the goal of this page is to make you aware that these products exist and to explain how they work.

Getting Help


If you would like to talk with our firm to learn more about the specific FIAs available in the market today and how they can help you with your retirement planning, please click here to email us or phone 813-964-7100.

To sign up for a free consultation or to just get more information click here.

Contact Us




Guarantees are backed by the financial strength and claims-paying ability of the issuing insurance company. This is not a comprehensive review of all the features and benefits. All the material details of annuities should be reviewed prior to making a purchase decision. Although an external index or indexes may affect contract values, the contract does not directly participate in any stock or equity investments. An annuity is intended to be a long-term, tax-deferred retirement vehicle. Earnings are taxable as ordinary income when distributed, and if withdrawn before age 59 ½, may be subject to a 10% federal tax penalty. If the annuity will fund an IRA or other tax-qualified plan, the tax deferral feature offers no additional value. Qualified distributions from a Roth IRA are generally excluded from gross income, but taxes and penalties may apply to non-qualified distributions. Consult a tax advisor for specific information.

Getting Help

If you would like to talk with our firm to learn more about the specific FIAs available in the market today and how they can help you with your retirement planning, please click here to email us or phone 1-813-964-7100

Call us 813-964-7100

To sign up for a free consultation or to just get more information click here.


Contact Us


Fixed Indexed Annuity, Fixed Index Annuities for a worry-free retirement: Is it right for you? – YouTube