Equitable, a leading financial services organization and
principal franchise of Equitable Holdings, Inc. (NYSE: EQH), today
announced updates to two of its market-leading registered index
linked annuity (RILA) products. These updates are designed to help
financial professionals and their clients manage volatile equity
markets and generate lifelong income amid rising inflation and
interest rates.
Equitable’s Structured Capital Strategies® Income (SCS Income),
launched in November 2021, increased certain income rates credited
under the income option by 25 bps. SCS Income is a RILA that
combines some protection from equity market volatility while
allowing investors to take advantage of equity market growth
potential up to a cap, with a predictable stream of income in
retirement — a significant advantage at a time when equity markets
have declined by 20%i, and inflation has reached highs not seen
since 1982.ii
In addition, both commission and fee-based versions of
Equitable’s Structured Capital Strategies® PLUS (SCS PLUS) RILA are
also now available in New York, extending its availability to a
greater number of financial professionals and their clients.
“Clients are experiencing the perfect storm — a volatile equity
market, inflation higher than we’ve seen in four decades, rising
interest rates, and fixed income markets that are not providing the
investment diversification they once did,” said Steve Scanlon, Head
of Individual Retirement, Equitable. “As a result, the traditional
60/40 stock and bond portfolio has rightfully come into question.
We believe that an annuity used as an asset class in a portfolio
can help mitigate these challenges by providing for income, growth
opportunities and the ability to address some equity market risk.
The result of adopting these updated annuity-based products can be
a more diversified and resilient portfolio.”
Equitable created Structured Capital Strategies®, the first
registered index-linked, or buffered, annuity in 2010.
RILA products such as SCS PLUS can offer clients who are
reaching retirement age partial protection from the sequence of
return risk associated with a correction or bear market. Recent
research shows investors value mitigating risk to their retirement
income. In a 2021 study from CANNEX and The Alliance for Lifetime
Income, 55% of investors said protected income is important to
them.
The opportunity for partial downside protection can also be an
ideal portfolio asset for consideration by affluent clients who see
the possibility for tax increases on the horizon. Annuities are one
type of financial product that can offer tax-deferred accumulation
and tax-free movement among subaccounts, and annual contributions
are rarely capped. These tax advantages can make the product
attractive as a wrapper for investments with high asset turnover,
such as REITS and aggressive growth funds.
The latest updates to the Structured Capital Strategies®
variable annuity suite follow updates made earlier this year to
Equitable’s Investment Edge® investment only variable annuity.
Investment Edge updates included the addition of 20 structured
investment option segments that provide partial downside protection
from equity market losses and upside potential up to a cap —
similar to those available in the Structured Capital Strategies®
suite of variable annuities — and asset allocation options based on
model portfolio strategies for moderate growth and growth risk
profiles that give clients access to popular investment choices in
a tax-deferred format.
About Structured Capital Strategies® Through the
Structured Capital Strategies® suite of products, clients can
participate in one of several mainstream equity market indices up
to a cap, with a buffer protecting against the first -10%, -15%,
-20% or -30% of potential losses. Clients can choose the equity
index on which the performance of their investment is based, such
as the S&P 500 Price Return Index, Russell 2000® Price Return
Index, iShares® MSCI EAFE ETF or NASDAQ 100 Price Return Index.
They can also select the duration of their investment and its level
of downside protection based on their goals and risk tolerance.
The Dual Direction feature available in some of the suite’s SCS
offerings allows clients to earn a positive return even if the
S&P 500 declines. It does this by crediting a return equal to
the percentage of the decline up to, or equal to, the amount of the
buffer (-10%, -15% or -20%). Positive market returns are credited
up to the cap.
Structured Capital Strategies® Income adds two innovative ways
to create guaranteed income in retirement, including the ability to
start receiving income immediately from a registered index-linked
annuity, a level income option which provides an income rate
initially based on age at the time of purchase and that does not
decrease, and an accelerated income option, which provides a higher
rate of income in early retirement when individuals may have higher
expenses.
About Equitable Equitable, a principal franchise of
Equitable Holdings, Inc. (NYSE: EQH) has been one of America’s
leading financial services providers since 1859. With the mission
to help clients secure their financial well-being, Equitable
provides advice, protection and retirement strategies to
individuals, families and small businesses. Equitable has more than
8,000 employees and Equitable Advisors financial professionals and
serves 2.8 million clients across the country. Reference to the
1859 founding applies specifically and exclusively to Equitable
Financial Life Insurance Company.
Registered index-linked annuities (RILA) include a partial
protection feature that eliminates a portion of the contract
holder’s downside risk, while still giving the contract holder the
opportunity to invest for growth up to a cap. Through the partial
protection feature, the buffer will absorb the loss up to the
buffer selected. However, there is risk of substantial loss of
principal because the investor agrees to absorb all losses that
exceed the protection provided. An annuity is a long-term financial
product designed for retirement purposes. Simply stated, an annuity
is a contract between the contract holder and a life insurance
company that lets the contract holder pursue the accumulation of
assets through equities and other investment options. The contract
holder may then take payments or a lump sum amount at a later date.
There are fees and charges associated with variable annuities,
which contain certain restrictions and limitations and are subject
to market risk including loss of principal. All contract and rider
guarantee are backed by the claims-paying ability of the issuing
life insurance company. It is not possible to invest directly in an
index. Equitable Holdings, Inc. subsidiaries do not provide tax,
accounting or legal advice or services.
Variable and registered index-linked annuities are offered by
prospectus, which contains detailed information about the contract
and its charges, risks, expenses, and investment objectives.
Prospective contract holders should read the prospectus and
consider this information carefully before purchasing a contract or
sending money.
This informational article is not intended and should not be
construed or relied upon as financial, insurance or investment
advice. Equitable is the brand name of the retirement and
protection subsidiaries of Equitable Holdings, Inc., including
Equitable Financial Life Insurance Company (NY, NY), Equitable
Financial Life Insurance Company of America, an AZ stock company,
NJ, and Equitable Distributors, LLC. “Equitable” is used throughout
this release to refer to Equitable Financial Life Insurance Company
(Equitable Financial) (NY, NY), issuer of the Structured Capital
Strategies® and Investment Edge® variable annuities. Effective on
or about November 14, 2022, when distributed outside of New York
state by Equitable Advisors, LLC (member FINRA, SIPC) (Equitable
Financial Advisors in MI & TN) through Equitable Advisors
Financial Professionals (FP) whose business address is not in New
York state, or when distributed by Equitable Distributors, LLC
through financial professionals of unaffiliated broker/dealers when
the solicitation state is not New York, Structured Capital
Strategies® Income, Structured Capital Strategies® PLUS, and
Investment Edge® variable annuity is issued by Equitable Financial
Life Insurance Company of America (Equitable America), an AZ stock
company. When offered by Equitable Advisors FPs whose business
address is in New York state or when distributed by Equitable
Distributors, LLC through financial professionals of unaffiliated
broker/dealers when the solicitation state is New York, Structured
Capital Strategies® Income, Structured Capital Strategies® PLUS,
and Investment Edge® is issued by Equitable Financial. The
obligations of Equitable Financial and Equitable America are backed
solely by their own claims-paying abilities.
GE-5041635.1(10/22)(exp.10/24)
i
https://www.morningstar.com/articles/1115886/q3-2022-market-performance-in-charts
ii https://ycharts.com/indicators/us_inflation_rate
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version on businesswire.com: https://www.businesswire.com/news/home/20221026005772/en/
Media: Abby Aylman Cohen (212) 314-2010
mediarelations@equitable.com
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