Understanding Annuities Lessons Risk

Market uncertainty is constant. Dramatic moves in the market may cause you to question your strategy or worry about your money.

When the market moves it can be a good reminder to review investments regularly. Diversification1 (having exposure to different areas of the market) can help the overall risk in your portfolio and match your personality and goals.

So what are some options when it comes to market downturns? If you are nervous about the market going down again, you can change your risk level.

One way to help ease the uncertainty could be to consider a hands off approach and invest in a professionally managed account for longer term goals such as retirement.

Managed investments provide asset allocation2, and ongoing tax management.

Understanding a Fixed or Fixed Indexed Annuity can also lead to account protection from market losses. These products can provide predictable and guaranteed income for life3 with locked in gains.

Once credited they cannot decline in the future.

Interest Earnings for Fixed Indexed Annuities are based upon the gain in a financial market index.

They are considered Defensive as they can't lose value due to market declines and diversified as they can be allocated into multiple asset classes and indexes.

Annuities can also be laddered for multiple durations.

Whatever your time horizon, goals, or risk tolerance is, you must be comfortable with your investments.

There are many choices when it comes to meeting investment needs. It's good to try to understand them.

Amanda Meiklejohn is a Financial Advisor for Legacy Investment Services located in Legacy Bank, Pratt and is a native of St. John.