A Fixed Indexed Annuity (FIA) is a type of fixed annuity whose interest credits are linked to the performance of a stock market index — such as the S&P 500 — while protecting your principal from market losses.
How FIAs Work
When the chosen index goes up, you receive a portion of those gains (subject to a cap or participation rate). When the index goes down, you receive zero interest — but you don’t lose principal. This “floor of zero” is one of the most appealing features of a FIA.
Key Terms
- Participation Rate: The percentage of index gains credited to your account (e.g., 80% participation in S&P 500 gains)
- Cap Rate: The maximum interest you can earn in a given period (e.g., capped at 9%)
- Floor: The minimum interest rate — typically 0%, meaning you never lose principal due to index performance
- Spread: A fee deducted from index gains before crediting
Who FIAs Are Best For
FIAs work well for conservative savers who want market participation without risk of loss — particularly those within 5–15 years of retirement.
Call us at 1-888-972-0024 to explore which indexed annuity strategies fit your retirement goals.