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Investing In Fixed Annuities During A Volatile Market Condition

The S&P 500 achieved more like 975+ days without ever getting a 10 percent decline. This is also considered as the 5th longest stretch on record based on the reports of Birinyi Associates.

With the market meltdown in 2008 and 2009, annuity investments as well as other portfolios has largely been affected. And with the volatile condition of the market, most experts suggest to rather invest in fixed annuity because it is simply low risk investment.

Fixed annuities are very low risk investment instrument, and can be easily achieved compared to traditional bank CDs. And since the fees fixed annuity may be postponed by this economic product is usually a better return than bonds or CDs. Fixed annuities can be classified as a reference, if you share the fate of the funds immediately or fixed annuity, where you can make a lump sum to fund the full amount of the premium under the current market price.

Most financial experts often suggest this type of investment vehicle for people who are considering their options for a retirement plan due to the fact that this financial option is guaranteed to offer a stable stream of income which is capable of lasting a lifetime depending on your contract with your provider.

For low-risk fixed interest investments, it can cause quite considerable amounts of return on investment for the investor. Depending on the choice of the fixed annuity investor can be offered either short or long term investment to understand the long-term investments often offer higher returns over the investment period in the short or medium term.

The good thing about fixed interest investments is that you do not have to be good in finance in order to reap the fruits of your investment. Once you’ve signed the contract and start paying your dues, you are guaranteed a stable source of income for your retirement.

Complexity, cost and liquidity are the three biggest issues that investors need to be concerned about,” said FINRA’s senior VP for investor learning, Gerri Walsh. “Unlike some products where when you’ve seen one, you’ve seen them all, with equity-indexed annuities, when you’ve seen one, you’ve seen one. Placed side by side, it’s hard to tell where there are similarities and differences between two different products. That makes it very difficult for any individual, whether consumers or sellers, to really appreciate the differences and the nuances of each product,” he added.

A major advantage of an investment on fixed annuities is that this financial vehicle can provide a balance between investment risk and return of investment even if you have to understand that low risk investment often means average yields.

Most of the time, fixed annuities tend to go for a low risk investment in shares, bonds and securities making it a good option for wealth generation. It also limits the accumulation of funds and is limited to involve the Account in the options for capital growth. For those who are looking for aggressive ROI but do not have sufficient financial vehicles, investing in fixed annuities is a viable option because of its low risk nature.

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