Annuity Truth Explained: Fixed vs Variable vs Index Annuities | Erica Sellers

Stephen Jeung, founder and CEO of Jeung Agency, sits down with annuity expert Erica Sellers of Cavalier Associates (26+ years in the business) to explain how annuities actually work — beyond the sales pitch. They break down the three core types of annuities, how bonuses and caps work, why an annuity is the only product that can guarantee income for life, and the biggest mistakes people make when buying — or ignoring — one. Timestamps0:00 Welcome: Why Annuities Are So Misunderstood0:52 Meet Erica Sellers, Annuity Expert at Cavalier Associates1:12 Erica's 26+ Years in the Annuity Business3:13 Biggest Mistakes People Make Approaching Retirement5:12 What Exactly Is an Annuity?7:39 3 Types of Annuities: Fixed, Variable & Index (FIA)11:01 Real Example: Turning $100K Into Guaranteed Lifetime Income12:59 Why Annuities Get a Bad Rap14:32 Annuity Bonuses Explained (a $170K Example)16:52 Liquidity and How Annuities Have Evolved19:13 Case Study: Turning $1.2M Into a Full Retirement Plan21:16 Should You Replace an Old Annuity?24:58 Rapid Fire: Biggest Annuity Myths & Mistakes29:35 Free Annuity Review + Final ThoughtsKey Takeaways• Annuities are insurance products, not investments. The three core types are fixed (a CD alternative with a guaranteed rate), variable (market sub-accounts — full upside, full downside), and fixed index annuities (FIA), which credit gains tied to an index like the S&P 500 while protecting principal from market losses.• A fixed index annuity works like a CD "with training wheels": if the index is down, your credited return that year is 0%; if it's up, you're credited gains up to a cap (e.g., market +10%, 9% cap = you keep 9%).• Example from the episode: a 55-year-old placing $100,000 into an income annuity today could lock in roughly $1,400/month for life starting at 65 — or about $2,200/month for life by waiting until 72.• Bonuses (sometimes 15-17%+) can offset losses from a prior contract and start compounding tax-deferred on day one, though they usually come with a slightly lower cap.• Old annuities and orphaned 401(k)s deserve a review every 4-5 years, just like refinancing a mortgage — rates, riders, and bonuses change constantly.• The two biggest annuity myths: that they're all expensive (fixed and FIA annuities carry no advisor fees, unlike the 2-3% commonly layered into mutual funds) and that your money is locked away forever.Want a free review of your annuity, 401(k) rollover, or retirement income plan? Schedule a call at JeungAgency.com — link in bio. Let's take this relationship further and be friends on social:►Connect with Stephenhttps://linktr.ee/stephenjeungInstagram: https://www.instagram.com/stephenjeungTiktok https://www.tiktok.com/@stephenjeungFacebook: https://www.facebook.com/stephenjeungTwitter https://mobile.twitter.com/stephen_jeungLinkedin https://www.linkedin.com/in/stephen-jeung-2017a623Snap https://t.snapchat.com/Wcnxzd48Checkout my other Channelyoutube.com/@jeungagency►Jeung Agency | Life Insurance | Retirement Planning | Wealth Management | Health Insurance | Group Health and Retirementhttps://www.jeungagency.com►Financial Planning (401k, Roth IRA, IRA Rollover, Fixed Index Annuity) Free Consultationhttps://calendly.com/jeungagency/financial-planning-meeting►Life Insurance (IUL, Term, Return of Term, Final Expense, Whole Life, Mortgage Protection) Free Consultationhttps://calendly.com/jeungagency/lifeinsurancemeeting►Jeung Agency | Life Insurance | Retirement Planning | Wealth Management | Health Insurance | Group Health and Retirementhttps://calendly.com/jeungagency/businessretirement