Here you have an annuity that can potentially beat many stock funds over its 10-year life. And, unlike stock funds, you don’t have to sweat out the bad times because you are protected from losses.

 

Here’s a Fixed Indexed Annuity That Could Rival the Unbridled Performance of the Stock Market.

Given the backdrop of a pandemic and the accompanying recession, mostly everybody knows this has been a good year so far for the stock market.

But next year? Who knows? A vaccine is unlikely to reach the masses before mid-year and even if the federal fiscal stimulus is refreshed, in 2021 – like 2020 – it would last only a matter of months. So, somber investors cannot ignore the strong possibility of a negative market next year…

This brings us to fixed indexed annuities (FIAs) and, in particular, Midland National’s highly attractive MNL RetireVantage® 10 growth FIA. Like all FIAs, it protects its owners against the possibility of losses. Admittedly, nothing new here. What sets this FIA apart from the competition, however, is truly generous participation rates – 165% on a low-volatility fund if you invest at least $75,000 and agree to two-year index performance crediting.

Momentarily putting aside the fact that this is an annuity we’re talking about, it sounds more like a super-charged stock-oriented mutual fund with some extra bells and whistles.
It isn’t, of course, but nonetheless, here you have an annuity that can potentially beat many stock funds over its 10-year life. And, unlike stock funds, you don’t have to sweat out the bad times because you are protected from losses.

“This FIA is not actually designed to match or beat the stock market, but in fact it could deliver double-digit returns,” says one annuity professional familiar with the product. “It is best for people who do not want to put up with the volatility of the stock market but who want to beat the interest rate environment and are willing to invest their money for 10 years.” (10 years being the life of the fund.)

Some important details are in order.

  • For starters, this fund is indeed best for those who can invest at least $75,000. Prospective investors can instead invest as little as $20,000, but then the index participation rate drops to 140% with two-year crediting. (The participation rate drops still further for those who want one-year crediting, as is the case for $75,000-plus investors, but this is a negligible plus in a 10-year product.)
  • Equally important, it is worth repeating that the MNL RetireVantage® 10 invests in a low-volatility index – specifically, the S&P 500 MARC 5% index. It provides multi-asset diversification by investing in bonds and commodities, as well as stocks. This may not be a negative. This year through mid-October, the MARC index returned 7.4%, beating the S&P 500 at 6.1%. (Last year, however, the S&P 500 trounced the MARC index.) While nothing is certain, low volatility funds are generally less volatile than stock market indexes, as the name suggests, and investors pay for that feature by accepting a somewhat lower return.
  • Also important to note is that MNL RetireVantage® charges a 1% annual fee in exchange for providing such high participation rates. (The fees would be returned if the annuity doesn’t produce a profit over 10 years.)

Notwithstanding the fees and any other feature investors might not particularly like, it’s hard to bypass taking a good look at this product because interest rates are sitting at all-time lows and, if the Federal Reserve is to be believed, won’t be rebounding to any degree for years.

One example of the allure of MNL RetireVantage® is the participation rates being offered by other FIAS on low volatility indexes – 70 to 90%, far worse even though they don’t charge a “generosity” fee. The typical FIA participation rate on the S&P 500 is 20 to 30%, down from 35 to 40% at the start of the year and 45 to 50% at the start of 2019.

Meanwhile, the true competitor to FIAs – plain vanilla fixed annuities – are offering no more than 3.00% annually.

Given how low interest rates are and virtually certain to remain, investors might want to look at MNL RetireVantage as a partial replacement for bond fund investments. Ibbotson Associates, a unit of Morningstar and a leading authority on asset allocation, has said just this regarding all competitive FIAs.

Parent Midland National, which has been around more than a century has a stellar A+ rating from A.M. Best.

Prospective buyers might want to take a hard look at MNL RetireVantage sooner than later because it has already trimmed its participation rates twice this year.

 

Speak to an advisor by calling 1-866-223-2121 or completing the form below.

 

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Disclaimer:

The S&P MARC 5% ER Index is a multi-asset excess return index that strives to create more stable index performance through diversification, an excess return methodology, and volatility management (i.e. risk control). The index applies rules to adjust allocations among multiple asset classes creating a diversified basket of these assets. The index then adds an element of risk control by applying rules to allocate between this basket and cash. The index is managed to a 5% volatility level.

The “S&P 500®”, “S&P Multi-Asset Risk Control 5% Excess Return Index”, “S&P 500® Low Volatility Daily Risk Control 5% Index” and “S&P 500® Low Volatility Daily Risk Control 8% Index” Indices (“Indices”) are products of S&P Dow Jones Indices LLC or its affiliates (“SPDJI”) and have been licensed for use by Midland National® Life Insurance Company (“the Company”). Standard & Poor’s® and S&P® are registered trademarks of Standard & Poor’s Financial Services LLC (“S&P”) and Dow Jones® is a registered trademark of Dow Jones Trademark Holdings LLC (“Dow Jones”). The trademarks have been licensed to SPDJI and have been sublicensed for use for certain purposes by the Company. MNL RetireVantage 10 (“Product”) is not sponsored, endorsed, sold or promoted by SPDJI, Dow Jones, S&P, any of their respective affiliates (collectively, “S&P Dow Jones Indices”). S&P Dow Jones Indices does not make any representation or warranty, express or implied, to the owners of the MNL RetireVantage 10 or any member of the public regarding the advisability of investing in securities generally or in this Product particularly or the ability of these Indices to track general market performance. S&P Dow Jones Indices only relationship to Midland National with respect to these Indices is the licensing of the Index and certain trademarks, service marks and/or trade names of S&P Dow Jones Indices and/or its licensors. The Indices are determined, composed and calculated by S&P Dow Jones Indices without regard to Midland National or the Product. S&P Dow Jones Indices has no obligation to take the needs of the Company or the owners of this Product into consideration in determining, composing or calculating these Indices. S&P Dow Jones Indices is not responsible for and have not participated in the determination of the prices, and amount of MNL RetireVantage 10 or the timing of the issuance or sale of this Product or in the determination or calculation of the equation by which the Product is to be converted into cash, surrendered or redeemed, as the case may be. S&P Dow Jones Indices has no obligation or liability in connection with the administration, marketing or trading of the Product. There is no assurance that investment products based on these Indices will accurately track index performance or provide positive investment returns. S&P Dow Jones Indices LLC is not an investment advisor. Inclusion of a security within an index is not a recommendation by S&P Dow Jones Indices to buy, sell, or hold such security, nor is it considered to be investment advice.

S&P DOW JONES INDICES DOES NOT GUARANTEE THE ADEQUACY, ACCURACY, TIMELINESS AND/OR THE COMPLETENESS OF THESE INDICES OR ANY DATA RELATED THERETO OR ANY COMMUNICATION, INCLUDING BUT NOT LIMITED TO, ORAL OR WRITTEN COMMUNICATION (INCLUDING ELECTRONIC COMMUNICATIONS) WITH RESPECT THERETO. S&P DOW JONES INDICES SHALL NOT BE SUBJECT TO ANY DAMAGES OR LIABILITY FOR ANY ERRORS, OMISSIONS, OR DELAYS THEREIN. S&P DOW JONES INDICES MAKES NO EXPRESS OR IMPLIED WARRANTIES, AND EXPRESSLY DISCLAIMS ALL WARRANTIES, OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE OR AS TO RESULTS TO BE OBTAINED BY Midland National, OWNERS OF THE MNL RetireVantage 10, OR ANY OTHER PERSON OR ENTITY FROM THE USE OF THE INDICES OR WITH RESPECT TO ANY DATA RELATED THERETO. WITHOUT LIMITING ANY OF THE FOREGOING, IN NO EVENT WHATSOEVER SHALL S&P DOW JONES INDICES BE LIABLE FOR ANY INDIRECT, SPECIAL, INCIDENTAL, PUNITIVE OR CONSEQUENTIAL DAMAGES INCLUDING BUT NOT LIMITED TO, LOSS OF PROFITS, TRADING LOSSES, LOST TIME OR GOODWILL, EVEN IF THEY HAVE BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES, WHETHER IN CONTRACT, TORT, STRICT LIABILITY, OR OTHERWISE. THERE ARE NO THIRD PARTY BENEFICIARIES OF ANY AGREEMENTS OR AGREEMENTS BETWEEN S&P DOW JONES INDICES AND THE COMPANY, OTHER THAN THE LICENSORS OF S&P DOW JONES INDICES.

The MNL RetireVantage® 10 is issued on form AS124A/ICC16-AS145A.MVA/AS145A (contract), AR153A/ICC15-AR314A, AR327A/ICC15-AR307A, AR163A-1/ICC15-AR313A, AR192A/ICC15-AR315A, AR194A/ICC15-AR317A, AR201A/ICC16-AR308A, AR227A/ICC17-AR331A, AR244A/ICC16- AR310B.PB, AR369A/ICC19-AR369A, AR246A/ICC19-AR375A, AR247A/ICC16-AR330A, AR248A, AR328A, AR278A/ICC15-AR312A, ICC20-AR382A, ICC20-AR384A, and ICC19-AR373A REV 2-20 (riders/ endorsements) or appropriate state variation by Midland National® Life Insurance Company, West Des Moines, IA. This product, its features and riders may not be available in all states.

Neither Midland National, nor any financial professionals acting on its behalf, should be viewed as providing legal, tax or investment advice. Consult with and rely on a qualified advisor. Under current law, annuities grow tax-deferred. Annuities may be subject to taxation during the income or withdrawal phase. The tax-deferred feature is not necessary for a tax-qualified plan. In such instances, you should consider whether other features, such as the death benefit, lifetime annuity payments, and any riders make the Contract appropriate for your needs. Withdrawals taken prior to age 59 1/2 may be subject to IRS penalties.

A.M. Best is a large, third-party independent reporting and rating company that rates an insurance company on the basis of the company’s financial strength, operating performance, and ability to meet its obligations to policyholders. S&P Global Ratings is an independent, third-party rating firm that rates on the basis of financial strength. Ratings shown reflect the opinions of the rating agencies and are not implied warranties of the company’s ability to meet its financial obligations. The ratings above apply to Midland National’s financial strength and claims-paying ability. A) A.M. Best rating affirmed on Aug. 19, 2020. For the latest rating, access ambest.com. B) Awarded to Midland National® as part of Sammons® Financial Group Inc., which consists of Midland National® Life Insurance Company and North American Company for Life and Health Insurance®. C) Standard & Poor’s rating assigned Feb. 26, 2009 and affirmed on May 14, 2020. D) Fitch Ratings, a global leader in financial information services and credit ratings, on May 1, 2020, affirmed an Insurer Financial Strength rating of A+ Stable for Midland National. This rating is the fifth highest of 19 possible rating categories. The rating reflects the organization’s strong business profile, low financial leverage, very strong statutory capitalization, and strong operating profitability supported by strong investment performance. For more information access fitchratings.com.

NOT FDIC/NCUA INSURED, MAY LOSE VALUE INCLUDING LOSS OF PRINCIPAL, NO BANK/CU GUARANTEE, NOT A DEPOSIT, NOT INSURED BY ANY FEDERAL GOVERNMENT AGENCY.
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