Equity-indexed annuities guarantee customers a minimum interest rate while offering the potential of higher rates by tying your return to an index like the Standard and Poor's 500.

While it's similar to investing directly in the stock market, customers don't get the full participation of a rising market. With equity-indexed annuities, the money deposited by purchasers isn't invested directly in the stock market. Instead, customers are offered a percentage of how much the index gains over a period of time (not including dividends, which accounted for about 30 percent of the total return of the S&P 500 for the last 20 years), and a guaranteed minimum return if the stock market declines.

At predetermined times during the annuity's life, customers are credited with a percentage of the gain of the index. The schedule varies based on the annuities contract. Some offer annual "indexing," while others use various averages taken over the life of the annuity. Loss of principal is possible if the equity index annuity is surrendered before the end of the contract term.

Fixed annuities can be a great way for conservative investors to participate in the market, and at the same time earn a guaranteed interest rate and protect their principal. The consultants at Warren Steinborn Associates will help you determine which annuities are suitable for your situation and goals.

The S&P 500 is an unmanaged index and cannot be invested in directly.

Annuities are not FDIC insured, not a bank guarantee, and may lose value. Early withdrawals may be subject to surrender charges. Withdrawals prior to age 59 ½ may result in a 10% penalty, in addition to any ordinary income tax. The guarantee of an annuity relies on the claims-paying ability of the issuing company.

Securities offered through
J.P. Turner & Company, LLC (Member SIPC).
"J.P. Turner & Company, LLC is not affiliated with Warren Steinborn Associates"
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