Annuity portfolio rates are important to understand if you are looking into investing in annuities. This type of investment can be a great way to save for retirement or other long-term goals, but it’s important to know what you’re getting into. In this guide, we will discuss annuity portfolio rates and what they mean for your investment. We’ll also provide some tips on how to find the best rates for your needs.
What Are Portfolio Rates?
Instead of identifying specific assets on which an annuity’s interest rate is linked, an insurer may use a pooling method in which it pools all of its assets. The insurance company will then establish the interest-crediting rate for all of its annuity contracts using the interest rate it gets on its overall portfolio of invested assets.
Whether an insurer credits interest based on a portfolio or new money rate, the effects will generally be similar in the long term.