Insurance Products Offer Some Guarantees During the latter part of the last century, investing in the stock or bond markets made almost anyone look like a genius. With interest rates falling, the stock market grew to exciting levels and fixed income investments appreciated steadily. Even the threat of the Y2K disaster did nothing to dampen the investment environment where double digit annual returns were not only hoped for, but expected. Then in March of 2000, things took a change. Few believed it would last long. Many advisors had never lived through a bear market. They were in for an eye opening ride. The next two and a half years saw equity values drop sharply. The darling stocks of the 1990's became the biggest bombshells of the 2000's. Some investors lost 40% - 60% of the value of their investments. Those who were invested in certain dot-com companies saw an erosion of 80% or more of their portfolio values if not adequately diversified. There were many people, however, who had market exposure who didn't participate in those market losses. In many instances they not only avoided losses, they had steady annual increases in their guaranteed annuity balances. By 2003, when many people had seen their 401(k) balances reduced by 40-50%, these people were delighted with the regular annual growth in their accounts in some instances rates like 5-6%. Their money was allocated in products, backed by insurance-guarantees, that provided certainmarket gains while avoiding market losses. Some investment advisors steer their clients away from these insurance products because some of them are more costly than traditional investments. But many of these guaranteed accounts may have no annual fees. Those who had purchased these insurance contracts weren't complaining about the expenses when they saw certain gains at the same time that others were experiencing huge losses or were bailing out of the market entirely. The equity index annuities referred to come in different varieties. Some guarantee the greater of a return of all amounts invested in the account or a percentage of the index performance for which the product is tied. Others guarantee a base value from which income will eventually be paid which is the greater of a specified growth rate or the actual performance of the investments. Each equity index annuity has a minimum investment period; early distribution or surrender charges may apply if removed outside the contractual terms. Each has certain requirements or provisions. These insurance products are not for all investors. The tax provisions are more attractive for some than for others and have both advantages and disadvantages. For more information, contact Oxford Financial Group 800-765-6383. All guarantees are subject to the claims-paying ability of the underlying insurance company that issues the equity index annuity. Read the contract carefully before investing.