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BOSTON, September 12, 2005 - In an effort to make annuities affordable and easy to understand, Fidelity Investments today introduced two variable annuity products that offer streamlined benefits and fee structures that are dramatically less than industry averages.
The Fidelity Personal Retirement AnnuitySM, which offers tax-deferred growth for investors saving for retirement, has an annual charge of 0.25 percent, which is 82 percent less than the industry average of 1.41 percent.1 The Fidelity Freedom Lifetime IncomeSM variable income annuity, which offers a guaranteed2 income for those in retirement, has an annual charge of 0.60 percent, which is 46 percent less than the industry average of 1.12 percent3. The two new products do not include the excessive sales, maintenance or surrender fees found in many annuity products.
"We want to help more Americans get ready for retirement. Our new annuities address issues that have been barriers for many Americans interested in purchasing these products as retirement investment solutions in the past," said Jeffrey R. Carney, president, Fidelity Personal Investments. "We are making a dramatic move to help investors understand the benefits of annuities and provide them with the features they need - at prices that are affordable."
These new annuities, issued by Fidelity Investments Life Insurance Company, a subsidiary of Fidelity Investments, are now available to Fidelity's retail customers through the company's Fidelity.com website, from Fidelity phone representatives or at any of the company's 104 investor centers nationwide. Whether saving for or already living in retirement, investors can now choose an annuity geared toward their life stage that offers features and options, clearly defined fees and among the some of the lowest charges in the industry. These two new annuities also will be available to investors through the more than 2,800 Registered Investment Advisors who custody their assets with Fidelity.
More Tax-Deferred Savings for Less
Studies show that more than 60 percent of retirement income will have to come from personal savings4, rather than Social Security or company-funded pensions. The tax-deferred Fidelity Personal Retirement AnnuitySM, to which investors can contribute with no IRS limit, is designed to help investors supplement traditional retirement savings, such as 401(k)s and IRAs. Fidelity's new deferred variable annuity offers those planning for retirement an easy way to catch up on their retirement savings, at costs that are significantly below the industry average.
Features include:
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No surrender charges or penalties.
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Annual annuity charge of 0.25 percent.
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No annual maintenance charges and no 12b-1 distribution fees.
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Investment options - Underlying mutual funds include easy one-fund solution lifecycle funds, as well as a broad range of asset allocation, domestic and international equity, sector and fixed income fund choices.
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Choice of benefit payment options - Single, Joint and Survivor, 10 Year Guaranteed Period.
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1035 Exchange* - Tax-free exchanges from existing non-qualified annuities.
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Minimum purchase of $5,000.
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Free, automatic portfolio rebalancing service.
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Lifetime Income for Retirees
Americans are living longer and will need to fund a retirement that could last 30 years or longer5. The Fidelity Freedom Lifetime IncomeSM variable annuity offers retirees a pension-like guaranteed source of income payments combined with the diversified investments of the Fidelity VIP Freedom Lifetime IncomeSM funds.
Features include:
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Annual annuity charge of 0.60 percent.
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No annual maintenance charge.
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No initial sales charge.
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Tax-free exchanges from other qualified plans (401(k)s, IRAs, 1035 Exchange).
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Choice of income payment options - Single Lifetime, Joint and Survivor, Withdrawal (up to age 72).
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Optional protection for spouse and/or heirs.
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Minimum purchase of $25,000.
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About Fidelity Investments Life Insurance Company
Founded in 1987, Fidelity Investments Life Insurance Company (FILI), and its New York subsidiary Empire Fidelity Investments Life Insurance Company®, offer annuities and life insurance nationwide. With more than $13.4 billion in assets under management6, FILI is among the top 20 in assets among insurance companies. It has earned Standard & Poor's AA (very strong, 2nd highest) rating and A.M. Best's A+ (superior, 2nd highest) rating7. For more information about Fidelity Investments Life Insurance Company visit
www.fidelity.com/insurance.
About Fidelity
Fidelity Investments is one of the world's largest providers of financial services, with custodied assets of $2.3 trillion, including managed assets of $1.1 trillion as of July 31, 2005. Fidelity offers investment management, retirement planning, brokerage, and human resources and benefits outsourcing services to approximately 20 million individuals and institutions as well as through 5,500 financial intermediary firms. The firm is the largest mutual fund company in the United States, the No. 1 provider of workplace retirement savings plans, one of the largest mutual fund supermarkets and a leading online brokerage firm. For more information about Fidelity Investments, visit www.fidelity.com.
1 According to Morningstar/VARDS,R as of 12/31/04 the average non-group variable deferred annuity charge is 1.41%.
2 Guarantees are subject to the claims-paying ability of the issuing insurance company.
3 According to Morningstar/VARDS,R as of 12/31/04 the average variable income annuity charge is 1.12%.
4 Social Security Administration, Office of Policy, Income of the Aged Chartbook, 2001. Key sources of retirement income for households with incomes of $40,000 or more per year.
5 Fidelity Investments, A Fidelity Perspective: Planning for Retirement Income, 2004.
6 As of 7/31/05.
7 S&P rating reflects solid position in the variable annuity market, operating performance, capitalization, liquidity and investment quality, as of 8/31/05. A.M. Best rating reflects company's financial strength, as of 8/31/05.
*Before exchanging, check with your current annuity provider to see if it will assess a surrender charge.
Equity investments involve more risk because their value will fluctuate according to their performance.
Fidelity Personal Retirement Annuity and Fidelity Freedom Lifetime Income are not yet available in all states.
Fidelity Personal Retirement Annuity.(policy form no. DVA-2005, et al.) and Fidelity Freedom Lifetime Income (policy form nos. FFLI-Q-2005, et al. and FFLI-NQ-2005, et al.) are issued by Fidelity Investments Life Insurance Company. Fidelity Insurance Agency, Inc. and Fidelity Brokerage Services are the distributors.
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Fidelity Brokerage Services LLC, Member NYSE, SIPC,
100 Summer Street, Boston, MA 02110
Fidelity Investments Institutional Services Company,
82 Devonshire Street, Boston, MA 02109 |
