Gainbridge, a relatively new player in the annuity market, offers different annuity products designed to cater to different needs. Gainbridge aims to make these complex financial products more accessible to everyday investors while taking a digital-first approach on a small slate of offerings.
If you’re looking for a wider range of annuity options, take a look at the best annuity companies that offer high customer satisfaction and credit ratings plus an array of products.
This review dives into Gainbridge, its pros and cons, the annuities it offers and whether Gainbridge is the right choice for you.
Gainbridge pros and cons
Pros
- Digital-first approach: Gainbridge offers a convenient and efficient purchasing process.
- Variety within products: Gainbridge caters to different investor needs and risk tolerances.
- Strong financial backing: Being part of Group1001 provides a level of financial stability.
- Competitive rates: Gainbridge often offers competitive interest rates on its annuities.
Cons
- Limited product range: Compared to some established annuity providers, Gainbridge’s product lineup is relatively small.
- Lack of traditional agent support: While the digital approach is efficient for many, some prefer face-to-face interaction with an agent.
- New company: Gainbridge has a shorter track record compared to some competitors, which might be a concern for some investors.
What annuities does Gainbridge offer?
Gainbridge offers two primary types of annuities: multi-year guaranteed annuities (MYGAs) and single premium immediate annuities (SPIAs). MYGAs provide a guaranteed interest rate over a specific term, with taxes deferred until withdrawals begin. Single premium annuities involve a lump sum investment in exchange for fixed monthly payments, offering guaranteed income in retirement.
Gainbridge also offers two other annuity products tailored to individual financial goals and needs, combining elements of these core annuity types.
SteadyPace
SteadyPace is a single premium deferred annuity designed for people seeking guaranteed income and principal protection. You make a one-time investment, and your money grows tax-deferred until you begin withdrawing income at a future date. This product offers a competitive interest rate.
As a fixed multi-year guaranteed annuity (MYGA), it offers a fixed interest rate for a specified period, protecting your initial investment. While SteadyPace provides stability, it doesn’t offer additional optional benefits or riders.
FastBreak
FastBreak is another single premium deferred annuity, meaning you invest a lump sum upfront and receive payments at a future date. It guarantees your initial investment and earns interest at a fixed rate for a specific term.
Unlike most annuities, FastBreak doesn’t offer tax deferral on the interest earned: You’ll owe taxes on the interest annually, even before receiving payments.
While both FastBreak and SteadyPace are multi-year guaranteed annuities designed for long-term savings, they cater to different investor needs. FastBreak is suitable for those who might need access to their money before age 59½ since it avoids the 10 percent IRS early withdrawal penalty. SteadyPace is better for those saving for retirement who plan to leave the money invested until at least age 59½.
Both products allow a 10 percent annual withdrawal without penalty. If you need to withdraw more or surrender the contract early, you’ll face withdrawal charges and a market value adjustment.
ParityFlex
ParityFlex is a single premium deferred annuity that offers a unique combination of safety and potential growth. As a MYGA, it provides a guaranteed rate of return for a specific term, such as five or 10 years.
Unlike traditional MYGAs, ParityFlex offers a degree of flexibility through its ability to participate in potential market gains. While it doesn’t provide the same level of market exposure as a variable annuity, ParityFlex allows you to select from various index participation rates and cap levels.
ParityFlex also includes a built-in guaranteed lifetime withdrawal benefit (GLWB) at no additional cost.
OneUp
Unlike traditional fixed annuities that provide a guaranteed interest rate, OneUp offers a fixed interest strategy with a minimum guaranteed rate. It also allows your money to participate in potential market gains through its indexed strategies. This means your earnings can potentially exceed what a traditional fixed annuity might offer, but without the direct investment risks associated with the stock market.
It’s important to understand that while OneUp provides protection against principal loss, it doesn’t guarantee specific investment returns. Market performance will impact earnings from the indexed strategies. This product is suitable for investors seeking a balance of safety and growth potential, but it’s not designed for people who want total protection of their principal.
What is Gainbridge?
Founded in 2018, Gainbridge is a digital-first annuity company focused on simplifying the purchasing process for customers. By streamlining operations online, Gainbridge aims to offer lower costs and faster transaction times.
A subsidiary of Group 1001, a financial services group with about $62.6 billion in assets under management as of December 31, 2023, Gainbridge has a strong financial standing, offering a degree of security to investors.
Headquartered in Indianapolis, Gainbridge annuity products are issued by Gainbridge Life Insurance Company.
Is Gainbridge safe?
A major factor when considering an annuity is the financial stability of the issuing company. Gainbridge is part of Group1001, which includes the brands of Delaware Life, Clear Spring Life and RVI Group, among others.
Gainbridge has a strong A- rating from AM Best as of May 2023. This is a positive sign of the company’s ability to meet its obligations to policyholders.
Still, it’s advisable to conduct your own due diligence or consult with a financial advisor to fully understand the risks involved with purchasing an annuity.
The safety of your investment also depends on the specific annuity product you choose. Some annuities, like fixed annuities, offer more protection of your principal than others, such as variable annuities. Make sure you understand the features and guarantees of each product before signing a contract.
Bottom line
Gainbridge offers a compelling proposition for people seeking a straightforward way to purchase annuities. Its digital platform and competitive rates are attractive features. However, the limited product range and lack of traditional agent support might be drawbacks for some.
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