“Does using a Fixed Index Annuity (FIA) make sense inside my IRA?”
It depends. What is your goal for taking such a step?
If your goal is income tax sheltering – this is a bad idea. If your goal is to maximize the return you’re generating inside your IRA – this is a bad idea. If you believe that an FIA will give you stock market returns with no downside risk – this is a bad idea.
If your goal is to protect a portion of your retirement funds from losses – this could be a good idea. If your goal is to supplement your bond component of your portfolio with a bond-like alternative – this could be a good idea. If your goal is principal protection – this could be a good idea.
FIAs are complex financial products. You must get a solid education in their working parts before you conclude they fit you. Consult with an objective FIA advisor who can help you evaluate both your interest and (if they are a fit) what companies and FIA contracts might best fit your needs. Questions? We can help.
If you have questions or comments, please send them to Gene@AskMtM.com