What Should I Do With My Bonus Gold Annuity?
If you own a Bonus Gold Fixed Index Annuity from American Equity, you may have questions about your current options and what steps to take next. This annuity product is no longer being sold, but if you already have one, you can still benefit from its unique features.
In this guide, we’ll explain what you can do with your Bonus Gold annuity, how to manage it, and when it might make sense to replace it with a new annuity.
Key Features of the Bonus Gold Annuity
1. Premium Bonus
Your Bonus Gold annuity provided a 10% bonus on all premiums paid during the first contract year. This bonus was immediately added to your contract value, giving your savings a boost right from the start.
2. Principal Protection
One of the primary benefits of the Bonus Gold annuity is principal protection. This means your original investment is safeguarded from market downturns, ensuring you don’t lose money due to market volatility.
3. Tax-Deferred Growth
Any interest earned in the annuity grows on a tax-deferred basis. You don’t pay taxes on the growth until you start taking withdrawals, allowing your money to compound faster.
4. Lifetime Income Benefit Rider (LIBR)
The Lifetime Income Benefit Rider offers predictable income payments for life. Depending on the rider option you selected, your income is based on the accumulated Income Account Value (IAV). This rider ensures you receive income even if the contract value runs out.
5. Liquidity Options
After the first contract year, you can take penalty-free withdrawals of up to 10% of your contract value annually. Additionally, if you have a qualifying event, such as confinement to a nursing facility or a terminal illness diagnosis, you may be able to access your funds without surrender charges through specific riders.
6. Death Benefit
If you pass away, your beneficiaries will receive the greater of the contract value or the minimum guaranteed surrender value, helping them avoid probate and ensuring they get the maximum benefit.
Managing Your Bonus Gold Annuity
Although the Bonus Gold annuity is no longer being offered for new sales, you can still manage your existing contract effectively. Here are a few steps you can take:
1. Review Your Current Contract
Check your most recent statement or contact American Equity to confirm your current contract value, interest crediting method, and any remaining surrender charges.
2. Consider Your Income Needs
If you haven’t started taking income payments yet, evaluate when it might be best to start. The income you receive will depend on your age, the payout option (single or joint life), and the accumulated IAV.
3. Utilize Penalty-Free Withdrawals
If you need access to your money, remember that you can take up to 10% of your contract value annually without penalty after the first year.
4. Check for Surrender Charges
If you’re considering making a large withdrawal or surrendering the contract, be aware of the current surrender charge schedule. Charges decrease over time and eventually drop to zero after 17 years.
Should You Replace Your Bonus Gold Annuity?
In some cases, replacing your Bonus Gold annuity with a newer product may provide better benefits, such as:
- Higher income payouts
- Increased flexibility
- Enhanced growth potential
However, replacing an annuity should be done carefully to avoid unnecessary surrender charges or tax consequences. If you’re considering a replacement, we can help you compare options and find a solution tailored to your financial goals.
How The Annuity Expert Can Help
Whether you have questions about your Bonus Gold annuity, need help managing it, or want to explore new annuity options, we’re here to assist. At The Annuity Expert, our team of experienced professionals can:
- Answer your questions about your current annuity
- Help you understand your income options
- Provide a free comparison of new annuity products
- Guide you through the process of replacing your annuity if appropriate
Our service is free, and there’s no obligation. We’re committed to helping you make the best decisions for your retirement.
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