Greg's Hits - April 2023

Which Crediting Method Is The Best?

Click here for a short video about this month's issue‍

It would be great if there were an easy answer to this question, but there is no such thing as ‘The Best’ crediting method.  

Every crediting method must be analyzed by the crediting power of multiple factors, like:

1. Movement of the associated index
2. Measurement Period
3. Participation Rate
4. Cap
5. Spread
   

Let’s compare a couple of currently available crediting methods to show how this works.

1. S&P 500 Low Volatility 5

• Annual Point-to-Point
• Participation Rate = 195%
• No Cap
• No Spread

2. NASDAQ Frequency Control

• Annual Point-to-Point
• Participation Rate = 115%
• No Cap
• No Spread

At first glance, we might assume that crediting method #1 would produce more gains because the participation rate is much higher than the rate in #2.

But in reality, #2 out-performs #1. Here are the average annual returns for both when applying both crediting methods to the last 10 years of performance in the two different indexes:

1.  9.91%
2. 11.80%
   

4.85% Guaranteed Return CD-Type Annuity, with Return Of Premium?

Yes, a Multi-Year Guaranteed Annuity that offers the option to walk away with ZERO surrender fees after the first policy anniversary!

MANY advisers are telling us they have clients who want bank-like assets, but are afraid of banks due to the recent failures of Silicon Valley Bank and others. And some of those clients are uneasy about a 5 year surrender period in an annuity. So, having a 4.85% guaranteed return, with a full Return Of Premium bailout feature, is a great solution.

Here is how the Return Of Premium works;  Anytime after the first policy anniversary, the client can cancel the policy and get 100% of their initial premium back with no deductions for surrender fees, market value adjustments, administration fees, or ANY deductions of any kind.  And many advisers have then sold index annuities once they get the conversation going.  

Give us a call for more about how.

‍~ Greg Skogsberg

800-200-9194

Click here for a short video about this month's issue

‍

We now have annuity contracts with FORTY-FIVE carriers.  More than any other FMO!  And this is just one of the reasons we are The #1 Concierge FMO in America!