Fixed Index Annuity Calculator
NOTE: We are using the Variable Annuity Calculator for Fixed Index Annuity Calculator purposes. An Index Annuity will have performance characteristics similar to a Variable Annuity, however it comes without much of the downside risks. As with all our calculators, rates will vary and this index annuity calculator is really for simple illustration purposes only. View all our annuity calculators, or read on for a description of how this index annuity calculator works.
Fixed Index Annuity Calculator
Retirement Planning Calculator
Fixed Index Annuity Calculator: Definitions
Fixed Index annuity A Fixed Index annuity is an insurance product designed to provide long-term, tax-deferred savings. You do not receive a tax deduction on the money you deposit, however, you pay no taxes until you begin making withdrawals. There are no annual contribution limits or income limits. An Index Annuity could be a good option if you wish to increase your tax-deferred savings. This calculator assumes that you make your contribution at the beginning of each year. Fixed Index annuity contracts will have different rules, restrictions and expenses that will vary by insurance company and by product within an insurance company. To fully understand an index annuity, make sure you fully understand all options, restrictions and expenses for your specific variable annuity before you enter into such a contract. This fixed index annuity calculator is not designed to describe a specific insurance product and should be used as a general illustration of the tax-deferred feature of an index annuity.
Surrender charges Press the “Enter Data” button to input surrender charges for this Index Annuity. You are allowed to enter the year and percent of the surrender charge. Surrender charges are a percent of the annuity balance you will be charged if you withdraw your annuity balance early. The actual surrender charges vary widely from annuity to annuity. Make sure to check with your investment advisor if you are unsure of the surrender charges that may apply to your particular annuity. Enter into the index annuity calculator.
Current age Your current age.
Withdrawal age Age you wish to start taking money out of the annuity. This calculator assumes that the year you begin withdrawals, you do not make any contributions to your annuity. So if you begin at age 65, your last contribution would have happened when you were actually age 64. Enter into the index annuity calculator.
Annual contribution The amount you will contribute to your variable annuity each year. Enter into the index annuity calculator.
Expected rate of return The annual rate of return you expect for your index annuity. This index annuity calculator assumes that your return is compounded annually and your contributions are made at the beginning of each year. The actual rate of return is largely dependent on the type of investments you select.
For example, from December 2000 to December 2010, the annual compounded rate of return for the S&P 500 was 0.899%, including reinvestment of dividends. From January 1970 to December 2010, the average annual compounded rate of return for the S&P 500, including reinvestment of dividends, was approximately 10.05% (source: www.standardandpoors.com).
Since 1970, the highest 12-month return was 61% (June 1982 through June 1983). The lowest 12-month return was -43% (March 2008 to March 2009). Savings accounts at a bank may pay as little as 1% or less but carry significantly lower risk of loss of principal balances. It is important to remember that these scenarios are hypothetical and that future rates of return can’t be predicted with certainty and that investments that pay higher rates of return are generally subject to higher risk and volatility.
The actual rate of return on investments can vary widely over time, especially for long-term investments. This includes the potential loss of principal on your investment. It is not possible to invest directly in an index and the compounded rate of return noted above does not reflect sales charges and other fees that funds and/or investment companies may charge. Insurance products may additionally include mortality, expense risk charges, cost of insurance, administrative, and surrender charges that will have a significant impact on the total rate of return for the investment. Enter into the index annuity calculator.
Current tax rate Your current marginal tax rate you expect to pay on your taxable investments. Enter into the index annuity calculator.
Retirement tax rate The marginal tax rate you expect to pay on your investments at retirement. Enter into the index annuity calculator.
Years until retirement Number of years before retirement. Enter into the index annuity calculator.
Annuity total before taxes Total value of your variable annuity at retirement before taxes. Enter into the index annuity calculator.
Annuity total after taxes Total value of your variable annuity at retirement after taxes are paid. Enter into the index annuity calculator.
Total taxable accountTotal value of your savings, at retirement, if your annual contribution is deposited into a taxable account. Enter into the index annuity calculator. Information and interactive calculators are made available to you as self-help tools for your independent use and are not intended to provide investment advice. We cannot and do not guarantee their applicability or accuracy in regards to your individual circumstances. All examples are hypothetical and are for illustrative purposes. We encourage you to contact us and allow us to assist with selecting the best index annuity for your needs.
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