Free press releases distribution network?

Agency / Source: Thomas & Brannan Communications

Check Ads Availability|e-mail Article

Are you the owner of this article?, Turn it PREMIUM with your LOGO instead - and make it 3rd party Ads-Free! within the next hour!

Jeff Riddell of Riddell Law Group Explains Annuities from an Attorney's Point of View - Annuities From an Attorney's Point of View: An Overview
Jeff Riddell of Riddell Law Group Explains Annuities from an Attorney's Point of View


PRZOOM - /newswire/ - Sarasota, FL, United States, 2012/04/06 - Annuities From an Attorney's Point of View: An Overview.

Your Banner Ad Here instead - Showing along with ALL Articles covering Financial/Legal/Venture Announcements

Replace these Affiliate Programs at ANYTIME! Your banner here within the next hour. Learn How!


The first column in this four-part series provided an overview of annuities. This article will go into more detail about the three different types of annuities – fixed, fixed index and variable annuities.

Generally speaking, a fixed annuity provides a series of regular payments of a specified amount for a specified term. A variable annuity provides regular periodic payments, but the dollar amount of those payments varies depending on the performance of the underlying investments. A fixed index annuity is a hybrid which offers potentially greater interest than a regular fixed annuity because the interest is linked to the performance of an equity index. All three are available as either immediate annuities (which means that payouts begin immediately after setting up the annuity), or deferred annuities (payouts start after a specified accumulation period, allowing the investment to grow).

Fixed Annuities
Fixed annuities normally pay an income stream which is a combination of return of principal (the amount of premiums paid) and an interest factor described in the annuity contract. Unlike a variable annuity, which is linked directly to the stock market and the principal is at risk, fixed annuities do not put the principal at risk. Traditional fixed annuity payments usually never change, but some are now available with an inflation rider.

Payouts vary by age, and it is necessary to obtain a current quote when considering a fixed annuity since the interest rates upon which they are based are always changing. Once the contract is purchased, the interest rates are locked in and the payments will never change (unless there is an inflation rider).

A quote will normally include various payout choices such as single life; joint life; life plus various periods certain; flat five, 10, 15, 20 and 25 year payouts (without the life contingency); and others.

Whether immediate or deferred, principal is guaranteed in a fixed annuity. Fixed annuities are considered safe money alternatives to CDs, money market and treasuries. However, they may not be appropriate for everyone. You should make sure you fully understand the annuity before purchasing it.

Fixed Index Annuities
Fixed index annuities (or index annuities) are fixed annuities which potentially can have greater interest crediting. The insurance company links the interest it agrees to pay to the performance of an equity index. They are sometimes referred to as equity annuities.

Index annuities started in 1995. Much like a fixed annuity, in an index annuity the insurance company invests the majority of the premium in bonds. But unlike a fixed annuity, it also invests a small portion of the premium in a call option on the equity index, such as the S&P 500 index. If the index goes up by the end of the year, the insurance company exercises the option and makes a profit; then the company shares the profit with the owner of the annuity based on a pre-agreed sharing formula. Annuity purchasers are not investing in the index itself, and will not experience the same returns as the index or a related index mutual fund. Purchasers will only receive a stated percentage of an increase in an index because the annuity imposes a cap, spread or participation rate.

Here’s how a cap works: Let’s say that the index goes up 8 percent, but the cap is 6 percent. You receive 6 percent and the insurance company keeps the other 2 percent.

Here’s how the spread works: If the index goes up 8 percent, but the spread is 2 percent, the insurance company keeps the first 2 percent and the annuity owner receives the other 6 percent (over the 2 percent spread).

In this example, the spread would work better for you if the index rose more than 8 percent (you would receive everything over 2 percent even is the index rises 20 percent), but the cap would work better if the index went up only 4 percent (you receive 4 percent and the insurance company gets nothing).

Here’s how a participation rate works: If the participation rate is 50 percent, you split the index increase with the insurance company.

Caps, spreads and participation rates seem to be the most daunting aspects of index annuities, but a qualified annuity consultant can assist you in choosing the kind of indexing that’s best for you, and you can change it every year if you wish.

Some advisers don’t like index annuities because insurance companies can change the participation rate, caps and spreads annually. They are afraid that the beginning rate is a teaser rate. Insurance companies don’t use teaser rates. The participation rate, caps and spreads established for any given year apply to both existing contracts and new business. Most companies can supply a report on how they have adjusted participation rates, caps and spreads over many years. Insurance companies need some flexibility because the prices they pay for bonds and call options change; if they can’t adjust what they credit to their annuity contracts, the insurance company’s financial stability could be jeopardized.

Index annuities, like fixed annuities, are considered safe money alternatives to CDs, money market and treasuries.

Variable Annuities
Variable annuities have been around for a number of years, but they became popular in the 1990s. Accumulation (profit) in variable annuities is linked directly to the stock market. In a standard variable annuity, principal is at risk because the stock market may go up or down over time. The insurance company receives the premium, keeps a small part for itself and then gives the balance to sub-account companies that it has partnered with. There are no caps, spreads or participation rates. The owner gets 100 percent of the gains or losses from the sub-accounts (similar to mutual funds).

The variable annuity might sound good especially if you are a long-term investor (which you should be), and you like the stock market. It’s true that the stock market has produced some of the best gains available over long periods of time, but there are costs associated with variable annuities that are not present in fixed or index annuities. These include an administration charge (monitoring the sub-accounts, general overhead, marketing, etc.) and mortality expense (the amount of the premium that pays for the death benefit). These are charged annually based on annuity account value and are usually quoted as a percentage of the account value. On top of insurance company’s charges, the sub-account companies charge a fee of between ½ percent and 3 percent of the funds placed in a particular sub-account.

Variable annuities are long-term investments designed for retirement and are subject to market fluctuation, investment risk, and possible loss of principal. Variable annuities are sold by prospectus only, which describes risk, fees and surrender charges that may apply. You must consider your investment objectives, risks, fees, charges and expenses carefully before you invest.

This article is for information purposes only and does not constitute legal advice.

Jeff Riddell ( is a Sarasota, Florida attorney with Riddell Law Group. He has published numerous articles on real estate transactions and most recently authored a book titled “21st Century Real Estate Investing.” He can be reached at (877) 455-2628.

Your Banner Ad Here instead - Showing along with ALL Articles covering Financial/Legal/Venture Announcements

Replace these Affiliate Programs at ANYTIME! Your banner here within the next hour. Learn How!


Agency / Source: Thomas & Brannan Communications


Availability: All Regions (Including Int'l)


Traffic Booster: [/] Quick PRZOOM - Press & Newswire Visibility Checker


Distribution / Indexing: [+]

# # #
  Your Banner Ad showing on ALL
Financial/Legal/Venture articles,
CATCH Visitors via Your Competitors Announcements!

Jeff Riddell of Riddell Law Group Explains Annuities from an Attorney's Point of View

Company website links NOT available to basic submissions
It is OK to republish and/or LINK any newswire for any legitimate media purpose as long as you name PRZOOM - Press & Newswire and LINK as the source.
  For more information, please visit:
Is this your article? Activate ALL web links by Upgrading to Press Release PREMIUM Plan Now!
Contact: Sheila Brannan Longo - 
941-355-3006 sheila[.]
PRZOOM / PRTODAY - Newswire Today disclaims any content contained in this article. If you need/wish to contact the company who published the current release, you will need to contact them - NOT us. Issuers of articles are solely responsible for the accuracy of their content. Our complete disclaimer appears here.
IMPORTANT INFORMATION: Issuance, publication or distribution of this press release in certain jurisdictions could be subject to restrictions. The recipient of this press release is responsible for using this press release and the information herein in accordance with the applicable rules and regulations in the particular jurisdiction. This press release does not constitute an offer or an offering to acquire or subscribe for any Thomas & Brannan Communications securities in any jurisdiction including any other companies listed or named in this release.

Financial/Legal/Venture via RSSAdd NewswireToday - PRZOOM Headline News to FeedBurner
Find who RetweetFollow @NewswireTODAY

Are you the owner of this article?, Turn it PREMIUM with your LOGO instead - and make it 3rd party Ads-Free! within the next hour!

Read Latest Press Releases From Thomas & Brannan Communications / Company Profile

Read Financial/Legal/Venture Most Recent Related Press Releases:

Western Union Business Solutions Announce Mark Davis As Head of Australia and New Zealand
Tabarak Investment Capital and Elite Capital & Co. Limited in Discussion to Finance Projects
Consulting Magazine Unveils the Profession’s Fastest Growing Firms At Inaugural Gala
Hills Invest Signs An Agreement with The Afore Profuturo in Mexico
TRA Searches for TPA Acquisition Opportunities
The Recorder Expands Daily Digital News Platform
Profitas, LLC Opens New Location in the San Francisco Bay Area
European Telecoms Market is Stable and Beating Expectations Says Wismuller Gunter Analyst
LexisNexis Announces its Intention to Acquire Intelligize Expanding its Securities and M&A Offering and Continuing to Invest in Analytical Tools
GE Completes Sale of U.S. Restaurant Finance Assets

Boost Your Social Network
& Crowdfunding Campaigns

NewswireToday Celebrates 10 Years in Business
Find business coaching, life coaching, executive coaching and corporate coaching, best selling coaching books, ...


Visit  Intrinsic Executive Search Ltd

Visit  Demyk Lightmod Products, Inc.

Visit  La Bella Bakery Artisan Bakery Arizona

  ©2016 PRZOOM — Limelon Advertising, Co.
Home | About PRZOOM | Advertise/Pricing | Contact | Investors | Privacy/TOS | Sitemap | FRANCAIS
newswire, PR free press releases distribution service magazines engine news alert newsroom press room breaking news public relations articles company news alerts newswiredistribution ezine bizentrepreneur biznewstoday digital business report market search pr firms agencies reports distri-bution today investor relation successful internet entrepreneur newswire distribution freenewswiredistribution asianewstoday bizwiretoday USA pr UK today