An Equity Indexed Annuity, EIA, is a product that is linked to such indexes as the S&P 500, NASDAQ 100, or even a fixed interest account.   EIA’s give the consumer an opportunity to realize most of the gains in the stock market without any of the risk.  Current gains can even be locked in and cannot be lost to future market downswings.

Consumers are becoming more adverse to loss of principal while still wanting a fair rate or return.  EIA’s can provide a happy medium between the risk of loss and the certainty of low yielding investments such as certificates of deposit. The tax deferred aspect is an added bonus.

Consumers like the fact that most EIA’s have no annual fees, service cost or front end loads associated with them.  Some of the most likely purchasers of EIA’s are CD buyers, long or even short-term investors who do not want to pay current income taxes and those with a low risk tolerance.  Another group are those that invest in low-yielding investments and continue to roll the interest and gains back into the investment while continuing to pay taxes.

The opportunity for upside growth with downside protection all wrapped in a tax deferred vehicle has made the equity indexed annuity an appealing alternative to more risky and taxable investments.

Please be advised that neither Asset Management Inc. nor any of its agents give legal or tax advice. This information has been derived from sources which we believe to be reliable but has not been independently verified by us. The opinions expressed herein reflect our current judgment and are subject to change without notice. We recommend that you consult with your tax advisor and attorney for complete details before making any final decisions.

Securities Offered Through Mutual Service Corporation, A Registered Broker/Dealer - Member NASD and SIPC

Asset Management, Inc. is not affiliated with Mutual Service Corporation.