SILAC Insurance Annuity Review

The Secure Savings annuity is a single premium fixed annuity. This means that you fund it with one payment and SILAC will pay a set interest rate for the guarantee period you choose - either two or five years. After the guarantee period, you can renew the contract, transfer to a difference contract, cash out or turn your balance into a regular income stream by annuitizing. 

Also called a multi-year guarantee annuity (MYGA), the Secure Savings annuity includes a death benefit. If you die before the annuity matures and you haven’t annuitized, your beneficiary will receive your full account value as a lump sum. There’s also a required minimum distribution (RMD) rider that allows you to withdraw your RMD (if you are over 70.5 years old) penalty free even if the RMD is larger than the 5% that’s allowed.

The minimum amount for this annuity is $10,000, and the maximum age is 90 years.

Fees

This annuity has no front-end or annual charges. But there are surrender charges for any withdrawals during the guarantee period that exceed the allowed annual amount of up to 5% or your RMD. These fees start at 9% and decline 1% every year of the guarantee period.

Withdrawals before age 59.5 may incur a 10% IRS penalty, plus ordinary income taxes.

Realistic Return Expectations

According to Blueprint Income, this annuity offers a 1.75% interest rate on a two-year contract and a 2.70% interest rate on a five-year contract, as of Feb. 2021. Of course, if you decide to renew at the end of your guarantee period, these rates will likely be different.

The Secure Savings Elite annuity is also a fixed annuity, otherwise known as a multi-year guarantee annuity (MYGA). The difference between it and the Secure Savings annuity is that the former offers a higher interest rate in exchange for less liquidity. This annuity is available for two- or five-year contracts, with the longer contract receiving the better rate.

This contract comes with a few liquidity riders that you can add. More specifically, you can make your annuity more liquid by purchasing an accumulated interest rider, required distribution (RMD) rider or 5% penalty-free withdrawal rider. This annuity has no extra death benefit options, so if you die before the contract matures, your beneficiary will receive the cash surrender value of your annuity, minus fees and withdrawals.

The minimum premium for this contract is $10,000. In addition, the maximum issue age is 90.

Fees

As with the non-elite version, there are no front-end or annual charges with this annuity. If you need to tap your money during the guarantee period, you’ll have to pay a surrender charge if you exceed a certain amount. The fee starts at 9% and declines 1% every year of the guarantee period. Also, withdrawals before age 59.5 may incur a 10% IRS penalty plus ordinary income tax.

Realistic Return Expectations

According to Blueprint Income, this annuity offers a 2.15% interest rate on a two-year contract and a 2.95% interest rate on a five-year contract, as of Feb. 2021. Rates are subject to change over time, so your renewed rate will likely not be the same.

Annuities in the Teton Series are single premium and fixed indexed. Your options for growing your savings are one fixed interest rate and a handful of index crediting strategies linked to the S&P 500 Index. You can choose one or more of the options and rebalance at the end of each crediting term. The indexed rates are limited at the top and bottom so your earnings are capped and your loss, at most, can be that you didn’t earn anything during the term.

If you die before the contract matures and you haven’t annuitized, your beneficiary will receive your account’s full value. If your beneficiary is your spouse, they can choose to continue the policy. At no additional cost, you can add a nursing home benefit, terminal illness benefit or home health benefit. These benefits take effect after the first year, and allow you to withdraw up to 100% of your account if you enter a qualified care facility and meet eligibility requirement, are diagnosed with a terminal illness and have less than 12 months to live and you require home health care and meet requirements, respectively.

This annuity is available as a 7-, 10- or 14-year contract. The maximum issue ages are 90, 85 and 80, respectively. To buy a policy, you need at least $10,000, with extra payments being allowed for up to the first year.

Fees

This annuity has no front-end or annual charges. There are surrender charges should you need to withdraw more money than is allowed for free during the guarantee period. The surrender fees kick in for any withdrawals in the first year and for those thereafter during the guarantee period that exceed the 5% that’s allowed and aren’t covered by a rider.

Also, withdrawals before age 59.5 may incur a 10% IRS penalty plus ordinary income tax.

Realistic Return Expectations

Your earnings from indexed crediting strategies are capped. So during a soaring bull market, you won’t see the high returns that investors in the stock market will. That said, when the market is heading for a downturn, your principal won’t take a hit. Only your gains will. If you opt for the fixed interest rate, you'll want to ensure that you keep steady with inflation. Unfortunately, SILAC does not release the fixed rates associated with this contract.

Annuities in the Teton Bonus Series are just like the Teton Series, except they pay an immediate bonus. This annuity is available as a 7-year, 10-year or 14-year contract. Each term's bonus is 10% for 14-year contracts, 7% for 10-year contracts and 5% for 7-year contracts.

Otherwise, this fixed indexed annuity comes with the same automatic death benefit and spousal benefit as the standard Teton Series annuities. It also allows you to add a nursing home benefit, terminal illness benefit and/or home health benefit at no additional cost.

The maximum issue ages for each term are 90 (7-year contract), 85 (10-year contract) and 80 (14-year contract). To purchase a policy, you need at least $10,000 for a premium payment.

Fees

With this annuity, there are no front-end or annual fees. You will, however, pay surrender charges if you withdraw more money than is allowed for free during the guarantee period. The surrender fees kick in for any withdrawals in the first year and for those thereafter during the guarantee period that exceed the 5% that’s allowed and aren’t covered by a rider. Additionally, you will forfeit all or part of the premium bonus, depending on which policy year you make the withdrawal.

Additionally, you’ll owe the IRS a 10% penalty and possibly income tax if your withdrawal is made before age 59.5.

Realistic Return Expectations

Money that earns the fixed interest rate may keep apace with inflation. Unfortunately, SILAC does not publicly disclose the fixed rate currently associated with this annuity. If you opt for indexed crediting strategies, your earnings are capped on both ends. So during a raging bull market, you won’t see soaring returns. But during a market downturn, neither will you see your principal take a hit. At worst, you won’t have any gains.