Nassau Re Annuity Review

The Nassau Growth Annuity is one of Nassau Re’s flagship contracts. To open one, you can't be older than 80, and you need at least $15,000 in investable assets.

As this is a fixed indexed annuity, you’ll receive both a fixed account and an indexed account. The former comes with a set interest rate from Nassau Re, while the assets in your indexed account will follow the performance of an index. You can allocate as much to either of these accounts as you’d like.

Nassau Re offers a couple of separate S&P 500 index strategies that are focused on investments in large-cap U.S. stocks. There are also two Smart Passage SG index strategies that look to outperform the S&P 500 through investments in low volatility stocks.

This contract comes with an optional Amplified Income Plus rider for an extra fee. By adding this to your account, you will receive a boost in your future income payments that will last for the remainder of your life. You can begin taking advantage of this rider any time after age 50. This benefit is also available through the base Amplified Income rider, though you'll lose out on annual interest roll-ups with the latter option.

Fees

The base version of the Nassau Growth Annuity doesn’t come with any annual fees whatsoever. However, if you choose to add the optional Amplified Income Plus rider to your contract, you’ll incur a 0.95% rider fee. The base Amplified Income rider has a lower 0.25% annual fee. In addition, three of the seven indexes that you can invest in charge a 2% annual strategy fee.

If you select the seven-year version of this contract, Nassau Re will let you withdraw up to 10% of your account value on a fee-free basis each year. For the 10-year variation, this limit drops to 5%. Anything above either cap is subject to the withdrawal charges below:

Like any other retirement account, individuals who withdraw from their annuity before age 59.5 will have a 10% IRS penalty levied against them.

Realistic Return Expectations

While the earnings you may receive or incur from your indexed account vary depending on what index you pick, the fixed account earns at a set rate. Nassau Re does not publicly release its interest rates for the fixed account.

Nassau Re specializes in fixed indexed annuities, and the Nassau Personal Retirement Choice product is another example of this type. If you open one, you’ll receive a fixed account and an indexed account. As you might expect, the latter garners returns based on a predetermined index’s performance, whereas the former earns at a specific rate.

For the indexed account, Nassau Re offers access to eight distinct S&P 500 index strategies and two CS Tactical Multi Asset index strategies. The S&P 500 options vary slightly, but they’re all centered around large-cap stock investments. The CS Tactical Multi Asset indexes work much differently, instead focusing on exchange-traded funds (ETFs).

If you’re willing to pay up for it, the optional Guaranteed Lifetime Income Benefit is one of the hallmarks of this contract. This rider ensures your income payouts will last for the rest of your life. In addition to that, your benefit base will earn annual simple interest roll-ups for the first 12 years of your contract’s life, or until you initiate payments.

The Nassau Personal Retirement Choice annuity has a $15,000 minimum initial premium and an 80-year-old maximum issue age. A premium bonus is also available with this contract.

Fees

You won’t have to worry about any annual contract fees with this annuity. The optional Guaranteed Lifetime Income Benefit rider does have an annual charge, though.

Annuitants are free to take out as much as 10% (depending on the state you live in) of their contract value annually before they run into withdrawal fees. These charges shrink every year, on the following schedule:

The IRS levies a 10% income tax penalty on any annuitants that withdraw from their account before turning 59.5 years old. This is in addition to your standard income tax rate.

Realistic Return Expectations

Because each index will perform differently, the returns or losses of your indexed account are subject to change on an individual basis. For the fixed account, Nassau Re does not publish rates publicly.

The Nassau Personal Income Annuity is highlighted by two guaranteed minimum withdrawal benefits (GMWBs); you'll need to choose one of them. Here’s an overview of each option:

• Income Strategy: Today: For each of your first three years as an account owner, this rider will increase your initial benefit base by a cumulative 45%. For years 3-10 of your contract’s life, you'll receive 3% simple interest increases, as long as you don't take an guaranteed income withdrawals during that time.
• Income Strategy: Tomorrow: If you can afford to wait to receive payments, this rider guarantees your initial benefit base will get a 14% increase over the first decade of your contract’s life, as long as you avoid accepting all guaranteed income withdrawals.

There’s a fixed account and an indexed account associated with this annuity. The fixed account is self-explanatory, as it will grow according to a specific interest rate. But the indexed account is more customizable, as Nassau Re lets you pick from eight S&P 500 index strategies and two CS Tactical Multi Asset index strategies. Depending on what you’re looking for out of this contract, feel free to invest as much or as little in each account as you’d like.

To become the owner of a Nassau Personal Income Annuity, you must be 80 years old or younger. The minimum investment required for this contract is $15,000.

Fees

Regardless of which version of the Guaranteed Minimum Withdrawal Benefit you decide on, it comes with a 0.95% annual rider fee. Otherwise, there are no annual contract fees.

Should you need to withdraw from your account before its maturity date, Nassau Re will let you remove up to 10% of your account value without fees. Any withdrawals beyond that amount incur charges, which are organized on a state-to-state basis:

If you’re under 59.5 years old and you make a withdrawal from your contract, the IRS will levy a 10% income tax penalty on the withdrawal.

Realistic Return Expectations

There are multiple indexes that you can choose your indexed account to follow. So while this rate is dependent upon that decision, your fixed account is not. The state you live in will likely dictate what your rate is, though Nassau Re does not publicly publish its rates.

Like most of Nassau Re’s fixed indexed annuity products, the Nassau Personal Protection Choice contract boasts a wide selection of benefit riders. To be specific, the company offers three choices:

• Income Protection
  • Today: If you avoid all withdrawals, you'll receive a 45% cumulative bonus to your benefit base over your first three years. For years 3-10 of your contract’s life, your initial benefit base is boosted by 3% annually, so long as you, again, avoid withdrawls.
  • Tomorrow: If you can afford to wait to receive payments, this rider guarantees your initial benefit base will get a 14% increase over the first decade of your contract’s life, unless you take withdrawals before then.
• Family Protection: Those concerned about the payout their beneficiaries will receive when they’re gone can choose this rider to boost their lump sum death benefit. These increases occur annually for the first 10 years of your contract’s life, or until you turn 85. The roll-up amount up to age 70 is 10%, while the amount for those 71 to 85 is just 5%.
• Care Protection: After your second contract anniversary, this rider will increase the size of your income distributions for five years if you’re placed in a long-term nursing home or are unable to perform two of six activities of daily living (ADLs).

At the core of all fixed indexed annuities are an indexed account and a fixed account. While the latter earns interest based on an annually changing fixed interest rate, an indexed account lets you personalize your investment.

Assets placed in your indexed account will either grow or shrink according to the performance of the index you choose. There are eight large-cap stock S&P 500 index strategies and two ETF-focused CS Tactical Multi Asset index strategies you can choose from.

There’s a $15,000 minimum initial premium for this contract, and a maximum issue age of 80 years old.

Fees

Customers won’t have to pay an annual contract fee of any sort to maintain ownership this annuity. There are separate benefit rider fees, though, if you add any of these three to your contract:

• Income, Family & Care Protection: 1.15% annual fee
• Income & Family Protection: 1.15% annual fee
• Income & Care Protection: 0.95% annual fee

While fee-free withdrawals during your contract’s accumulation stage are allowed up to a certain amount, that limit will be set individually by Nassau Re. Policy holders who go past this set amount will have to pay surrender charges.

The IRS keeps an eye on annuity owners who withdraw from their accounts before age 59.5, charging them a 10% penalty.

Realistic Return Expectations

The returns or losses that your indexed account sees depend on the performance of the index you choose. For the fixed account, though, Nassau Re does not release its rates publicly.