Prudential Annuity Review 2025 | Bankrate

Prudential affords a spread of annuities designed for various retirement earnings wants. A lot of their six product choices are a modified model of an index-linked annuity, which goals to let house owners not directly profit from potential positive aspects in shares and/or bonds, whereas providing some safety in opposition to market losses.

Contents

What annuities does Prudential provide?FlexGuard listed variable annuity Key options and who it is best for PruSecure mounted index annuity Key options and who it is best for Premier funding variable annuity Key options and who it is best for WealthGuard multi-year assured annuity Key options and who it is best for FlexGuard Earnings listed variable annuity Key options and who it is best for Prudential Mounted Annuity with Each day Benefit Earnings Profit Key options and who it is best for What’s Prudential Monetary?Prudential annuities professionals and cons Professionals Cons Backside line

Prudential additionally affords two mounted annuities, which tie their returns to a gradual, mounted rate of interest. The returns for mounted annuities may not provide the identical upside potential as different varieties, however they allow you to bypass a lot of the complexity, restrictions and prices saddling their index-linked and variable counterparts.

The satan is within the particulars with regards to annuities, so understanding the dangers, charges and progress limitations is essential earlier than committing to any monetary product.

For those who’re contemplating shopping for an annuity from Prudential, right here’s every thing it’s essential find out about what they provide.

What annuities does Prudential provide?

Prudential affords a collection of annuity merchandise, from mounted annuities to variable annuities. Every is designed to cater to totally different retirement earnings wants, although some achieve this in a extra simple method than others.

Earlier than shopping for an annuity, it’s sensible to talk with a third-party monetary advisor, ideally a fiduciary who’s ethically obligated to work in your greatest curiosity. They’ll find a way that will help you objectively think about all of your choices with out the bias you’d seemingly encounter from an insurance coverage agent or dealer engaged on fee.

Here’s a detailed have a look at Prudential’s six annuity choices.

FlexGuard listed variable annuity

The Prudential FlexGuard is a versatile premium deferred index-linked and variable annuity. If that looks like a mouth full, the anomaly and jargon doesn’t finish there. Listed annuities are notoriously complicated and this one isn’t any exception.

You may allocate your funds between totally different index methods and revel in potential progress tied to market indexes, such because the S&P 500. It additionally affords some draw back safety from market downturns by way of buffers. That’s the in need of it: For all of the nuts and bolts of participation charges, caps and buffers, you’ll must seek the advice of the prospectus.

Key options and who it is best for

Completely different index methods: Presents a spread of methods with customizable buffers and progress potential.
Draw back safety: Buffers restrict preliminary index losses inside a sure vary, with a minimal 5 % buffer. This prevents these losses from straight impacting your account worth. Nevertheless, losses exceeding the buffer nonetheless cut back your account worth.
Charges: Annual charges (as much as 1.3 %), give up expenses (as much as 8 % inside the first six years) and potential funding bills (as much as 1.26 %).
Who it’s greatest for: Folks nearing or in retirement who’re searching for some progress potential and draw back safety.

PruSecure mounted index annuity

The PruSecure annuity affords progress potential whereas additionally providing a modest assured mounted charge. The fixed-rate technique is assured for one yr and index-linked methods provide phrases of 1, three or 5 years. You allocate percentages of your preliminary funding to each methods.

Caps or participation charges restrict your potential positive aspects and a flooring protects in opposition to losses. For instance, in case your cap is 4 % and the market goes up 3 %, you get all the 3 %. If the S&P 500 runs up 20 %, prefer it did in 2023 and 2024? You continue to solely get 4 % of the expansion credited to your account.

Participation charges work in the same method. Your returns are restricted to a sure share of the market’s improve. At a 30 % participation charge, you’d see 6 % progress if the market went up 20 % and 0.9 % if it rose 3 %.

On the flip facet, if the S&P 500 drops 20 % in a single yr, like in 2022, you lose nothing, so your principal is protected by the ground.

Key options and who it is best for

Funding methods: Presents fixed-rate (one-year assured) and index-linked methods with one-, three- or five-year phrases.
Free withdrawal provision: As much as a ten % free withdrawal every year.
Mounted charge: You’ll earn a 3 % charge for the mounted technique for a one-year interval. After that, the speed can drop. Nevertheless, the disclosure notes that throughout the give up cost interval, the speed “will all the time be at the very least 1 %.”
Give up expenses: 5- or seven-year give up cost interval with a payment of as much as 9 %, reducing yearly. That’s a bit increased than the business commonplace of seven %, and better than Prudential’s different choices.
Minimal funding: $10,000.
Dying profit: Pays the better of the account worth or the minimal assured give up worth to beneficiaries.
Who it’s greatest for: Threat-averse individuals in search of modest long-term tax-deferred progress with draw back safety.

Premier funding variable annuity

This variable annuity affords tax-deferred progress — like all annuities — together with a spread of subaccount funding choices, together with managed and customised portfolios. Nevertheless, its payment construction is dense and complicated, and it carries the danger of loss with no flooring to guard in opposition to market losses.

The “pro-growth” payment construction means charges fluctuate along with your account worth, doubtlessly rising in case your steadiness declines, which means you pay extra when you’ve got a smaller account. Payouts from this deferred annuity can final your lifetime or a interval sure, relying on what you select.

Key options and who it is best for

Tax deferral: Delays earnings tax on progress till withdrawal.
Funding flexibility: Presents managed and customised subaccount portfolios.
Dying profit: It affords a regular dying profit that pays out the account worth after you die. An elective “Return of Buy Funds Dying Profit” can be accessible which ensures your beneficiary receives your preliminary funding again, however this rider tacks on an extra payment.
Give up expenses: As much as 7 % throughout the first seven years, which is fairly commonplace for many annuities.
Advanced expenses: A number of layers of charges apply to this annuity. Annual charges vary from 0.95 % to 1.39 % for the bottom contract, plus 0.29 % to 1.43 % for funding choices. Non-obligatory riders include further charges.
Who it’s greatest for: Folks in search of long-term, tax-deferred progress who’re comfy exposing their preliminary funding to market danger.

WealthGuard multi-year assured annuity

WealthGuard is a hard and fast annuity providing assured progress over three-, five- or seven-year phrases, defending your principal from market losses. A key characteristic is the ten % annual free withdrawal, however exceeding this triggers give up expenses and a market worth adjustment.

After the preliminary time period, you may renew for one yr with out penalties or select a brand new multi-year time period. Renewal charges can fluctuate.

Key options and who it is best for

Assured progress: Mounted returns for 3, 5 or seven years.
Minimal buy: $25,000.
No contract charges: There are not any annual contract or administrative charges, in contrast to the variable annuity possibility talked about earlier. Nevertheless, when you withdraw greater than 10 % throughout the give up interval, expenses could apply.
Charges: The speed you earn depends upon the size of your time period and the scale of your preliminary funding, with longer phrases and bigger deposits fetching increased charges. In January 2025, charges ranged from 4.6 % to five % for accounts with greater than $100,000 and about 4 % for accounts with lower than $100,000. Renewal charges will seemingly be decrease.
Annual free withdrawal: You may withdraw 10 % of your funds every year with out penalty.
Give up expenses: Penalties apply for withdrawals exceeding 10 % throughout the preliminary time period, beginning at 7 % and reducing over time.
Who it’s greatest for: Folks in search of protected, predictable progress with no participation available in the market.

FlexGuard Earnings listed variable annuity

Prudential’s FlexGuard Earnings annuity is much more complicated than the FlexGuard possibility talked about earlier. It’s a fee-heavy listed variable annuity with a number of crediting methods accessible, together with capped and uncapped progress choices, with buffers that intention to restrict losses.

Key options and who it is best for

Lifetime earnings: Offers a assured earnings stream, with the potential for elevated earnings based mostly on index efficiency.
Minimal buy fee: $25,000.
Give up expenses: As much as 7 % for withdrawals inside the first six years.
Annual charges: Base contract charges vary from 1.20 % to 1.45 % plus funding bills. Nevertheless, the prospectus notes that the bottom annual price for a $100,000 preliminary premium fee is $3,416, which works out to a 3.4 % annual payment.
Who it’s greatest for: Folks with a long-term funding horizon who’re keen to simply accept complicated funding methods and market dangers.

Prudential Mounted Annuity with Each day Benefit Earnings Profit

The Prudential Mounted Annuity with Each day Benefit Earnings Profit affords assured lifetime earnings and every day progress of future earnings that’s shielded from market danger. It’s a modified single premium deferred mounted annuity with a seven-year preliminary rate of interest interval that renews yearly after that.

Key options and who it is best for

Assured every day progress: Earnings quantity will increase every day till withdrawals start.
Lifetime earnings however at a price: Offers a gradual, predictable earnings stream for all times. Nevertheless the earnings profit carries a 0.95 % annual payment and you’ll’t cancel the earnings profit till you’re 5 years into the contract.
Minimal buy: $25,000.
Give up expenses: As much as 7 % inside the first seven years, reducing every year.
Free withdrawals: You may withdraw as much as 10 % of the account worth penalty-free yearly.
Dying profit: Beneficiaries obtain the better of account worth, earnings reserve or minimal assured give up worth.
Who it’s greatest for: Folks in search of assured retirement earnings with no market publicity who’re keen to decide to a long-term contract.

What’s Prudential Monetary?

Prudential Monetary is a big monetary providers supplier established in 1875. It affords a big selection of economic merchandise, together with life insurance coverage, annuities and mutual funds.

The corporate’s presence within the annuity market is important: Within the third quarter of 2024, Prudential ranked among the many prime 20 annuity issuers, with billions in annuity gross sales yr to this point, in accordance with LIMRA, an insurance coverage commerce affiliation.

Prudential holds top-tier rankings from unbiased companies, together with an A+ from AM Finest in January 2025, which displays its robust monetary stability and skill to satisfy claims. This issues as a result of an annuity’s assured earnings is just as dependable because the insurer behind it.

Prudential annuities professionals and cons

Professionals

Numerous annuity choices: Prudential affords quite a lot of annuities — together with mounted, listed and variable — to suit totally different retirement earnings wants and danger tolerances.
Sturdy monetary stability: Prudential holds top-tier rankings from companies like AM Finest, reinforcing its reliability to make good on future annuity payouts.
Draw back safety: Many Prudential merchandise characteristic buffers and flooring to assist restrict losses from market downturns.
Versatile withdrawal options: Most Prudential annuities enable penalty-free withdrawals as much as 10 % yearly.

Cons

Excessive and sophisticated charges: A number of annuities carry a number of layers of charges, together with annual contract expenses, funding possibility bills and elective rider prices.
Give up expenses: All Prudential annuities have give up cost intervals, which is commonplace fare for many annuities, whatever the insurer. Nonetheless, it must be famous that Prudential’s PruSecure mounted index annuity carries a 9 % give up cost originally of the contract, which is a bit increased than the business commonplace of about 7 %.
Complexity: Listed variable annuities, particularly, have intricate constructions that make it obscure your upside potential and safety from market losses.

Backside line

Prudential affords a spread of annuity choices, however a lot of them include complicated payment constructions and restrictions. These merchandise would possibly go well with conservative retirees searching for earnings safety, however when you’re in search of increased returns or extra flexibility, fastidiously weigh your choices. Consulting with a monetary advisor is important earlier than signing any annuity contract to make sure it really meets your monetary wants.

Editorial Disclaimer: All buyers are suggested to conduct their very own unbiased analysis into funding methods earlier than investing resolution. As well as, buyers are suggested that previous funding product efficiency isn’t any assure of future worth appreciation.