Today’s review is on the Flexmark MyFit Income Rider Index Annuity. The purpose of this review is to show you the strengths and weaknesses of this Annuity. To make an informed decision, it is important to consider all available facts.
- Product type
- Investment options that are available and their realistic long-term investment return expectations
- How it can best help your financial plan
- How it’s most poorly used as part of your financial plan
Flexmark MyFit Income Rider Index Annuity Quick Facts
|Product Name||Flexmark MyFit Income Rider Index Annuity|
|Issuer||Ameritas Life Insurance Corp|
|Type of Product||Index Annuity|
|S&P Best Rating||A+ “Good”|
+1 (800) 624-5837
Before we go into detail, here is an important legal disclosure.
This review of Flexmark MyFit Income Rider Index Annuity is an independent review at the request of readers. Intended to explain my perspective when breaking down the positives and negatives of this particular model annuity. This is an independent product review, not a recommendation to buy or sell an annuity. Equitable has not endorsed this review in any way, nor do I receive any compensation for this review. Before purchasing any investment product be sure to do your own due diligence and consult a properly licensed professional, should you have specific questions related to your circumstances. This review is not intended to give specific advice and your adviser may know more about your circumstances to make an appropriate recommendation. All names, marks, and materials used for this review are property of their respective owners.
Before we go into the review, some information on Ameritas
Ameritas Life Insurance Corp. (established in 1887 as Old Line Bankers Life Insurance Company of Nebraska) is a mutual insurance company. It is owned by Ameritas Mutual Holding Company, headquartered in Lincoln, Nebraska, United States. The company includes Ameritas Mutual Holding Company (AMHC) and Ameritas Holding Company (AHC), as well as Ameritas Life Insurance Corp. of New York.
There are a few ways that Agents might pitch Flexmark MyFit Income Rider Index Annuity
- No Rider cost
- Possibility for growth
- Principal protection
Fees for Flexmark MyFit Income Rider
As other fixed index annuities, Flexmark Myfit Index Annuity has high surrender fees. That’s why is always important to understand what annuity you are buying before committing your money to it.
It takes many years sometimes decades to recover all your money and there are things you must consider before buying an annuity, such as inflation rate, investment options, and riders. Even when everything fits together you shouldn’t put all your money into an annuity. A Fixed Index annuity can be a great strategy to allocate part of your portfolio to it since most of them offer you capital protection and could keep up with inflation. However, it is always important to check the prospectus to look for hidden fees that could be overlooked at the sales pitch by the insurance agent.
Besides the surrender fees, this annuity also has income rider fees that we’ll discuss later on this review.
How does this Annuity Work?
Flexmark MyFit Income Rider Index Annuity works like any other index annuity, it mirrors the movement of an index which are limited by a par or a cap. It also has 3 income rider options that we are going to analyze in detail later on in this review.
This annuity uses two-income interest strategies, the Fixed account that offers a fixed interest rate for a period of 12 months with interest accrued monthly instead of annually. Also, the Index option which returns are tied to a certain index with caps and par rates depending on the index that you choose.
If you choose to take the Index interest strategy, you can pick between the bonus and the no-bonus option, the difference is that the bonus option has higher caps and par rates which will limit your capital appreciation, by choosing the no-bonus option you will have more exposure to the index returns with a lower cap/par rate.
The bonus option will give you a 6% bonus on the first year premium, for example, if the first year premium was $100,000 then your bonus would be $6,000 for that year. The bonus account vests into your annuity over a period of 10 years, according to a vesting schedule. Once it is fully vested, the bonus account will be added to your annuity’s accumulation value.
Investment Options and Strategies for the Flexmark MyFit Income Rider Index Annuity:
- S&P 500
- Russell 2000
- BNPP Momentum 5 Index
- US Innovative Leaders 5 Index
- BNPP Momentum 5 Index
These are the indexes that your annuity returns can be tight up to. In the picture to the right.
How do the Incomer Riders for Flexmark MyFit Income Rider Index Annuity Work?
Basic GLWB Income Rider
The GLWB income rider comes included in this annuity at no cost. It gives you a 3% Premium Accumulation Rate (PAR) compounded for up to 10 years. The payout can start after 5 years from the contract purchase. What this rider does is guarantee some minimum level of lifetime income once it annuitizes. However, that amount can vary depending on the number of withdrawals or market movements along the years. During the withdrawal phase, you will receive a guaranteed income stream of your FlexMark Select accumulation value.
If you elect to begin receiving withdrawal payments, the greater of the PAV or the policy’s accumulation value plus any vested bonus account is used as the benefit base, a value that is multiplied by your lifetime distribution factor to determine your Lifetime Withdrawal Benefit Amount (LWBA). When you elect to begin receiving withdrawal payments, the greater of the PAV or the policy’s accumulation value plus any vested bonus account is used as the benefit base, a value that is multiplied by your lifetime distribution factor to determine your Lifetime Withdrawal Benefit Amount (LWBA).
MyFit Income Rider®
This income rider gives you the choice of level or lifestyle payout option when payouts begin. Choosing this option provides you with enhanced payouts followed by lower, level payouts. The payouts can start after the 1 year of contract and minimum age of 50.
This rider gives you 7% PAR compounded for up to 10 years and an optional 10-year restart and also it comes with 0.95% fee.
MyFit Income Rider with Booster*
This rider offers you the same characteristics as the Myfit Income rider plus double payouts for impairment in 2 of 6 activities of daily living. It also comes with a higher fee of 1.05% per year.
Where does it work best:
- Principal protection
- No cost GLWB
- For those to keep up with inflation and not grow their money
Where does it least work:
- People who need liquidity
- For Individuals looking for a high legacy for their heirs.
- For people looking to grow their money
Summary of the Flexmark MyFit Income Rider Index Annuity
Flexmark MyFit Income Rider Index Annuity has its pros and cons. The 6% bonus looks very appealing at first sight, but it will limit the capital appreciation on your cash account. However, the good aspect of this annuity is the principal protection that it offers which can be utilized for times of uncertainty in the economy, nonetheless, there are many other better products on the market that will do the same for you and even better, it is just a matter of looking for an experienced financial planner that can look through all the products available in the market and give find the one that better fit your needs.