In today's economic climate—where traditional savings accounts and certificates of deposit (CDs) are offering yields that barely outpace inflation—finding a fixed, high-yield option can feel like spotting a unicorn. That’s what makes Gainbridge’s FastBreak™ fixed annuity offer so compelling. With an APY of up to 5.80% and terms starting at just three years, this product stands out as a rare opportunity for savers looking for strong, predictable returns without venturing into the volatility of the stock market. But how does it really compare to a traditional CD? Let’s break down the pros and cons.

Gainbridge FastBreak™ Annuity: Pros & Cons

Pros

• Competitive Fixed Rates: Offers up to 5.80% APY, significantly higher than the national average for CDs, which is around 1.43%.
• Low Minimum Investment: Requires only a $1,000 minimum deposit, making it accessible to a broad range of investors. (5.5% for deposits under $100K)
• Partial Liquidity: Allows penalty-free withdrawals of up to 10% of the account value annually, providing some access to funds during the term. This is better than a CD where all of your money is locked up for the duration of the term.
• No Hidden Fees: Gainbridge eliminates commissions and administrative fees by offering the product directly online to you the consumer.
• Early Withdrawal Flexibility: Unlike many annuities, FastBreak™ permits withdrawals before age 59½ without incurring the typical 10% IRS penalty, though taxes on interest earned are due annually, just like any interest bearing investment.

Cons

• Not FDIC-Insured: As an insurance product, it's not backed by the Federal Deposit Insurance Corporation (FDIC). Instead, it's supported by the financial strength of the issuing insurance company.
• Surrender Charges: Withdrawals exceeding the 10% annual allowance are subject to surrender charges ranging from 1% to 5%, depending on the contract year.
• Taxable Interest: Interest earned is taxed annually, similar to CDs, which may not be ideal for those seeking tax-deferred growth.
• Longer Commitment: Minimum term lengths start at 3 years, which may not suit investors seeking shorter-term options.

FastBreak™ vs. Traditional CDs: A Comparison

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Final Thoughts

The Gainbridge FastBreak™ annuity offers a compelling alternative to traditional CDs, especially for investors seeking higher fixed returns and some liquidity over a medium- to long-term horizon. Its competitive rates and low minimum investment make it accessible, while the annual withdrawal allowance adds flexibility. However, the lack of FDIC insurance and the presence of surrender charges for larger withdrawals are important considerations. As with any financial product, it's crucial to assess your individual financial goals and risk tolerance before investing.

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