In the first part of this series, we dug into the nuts and bolts of the new 457(b) plan for Elizabeth city workers—what it is, how it stacks up against other retirement accounts like 401(k)s and 403(b)s, and why it’s such a valuable tool for building your financial future.
Toward the end of that article, we teased two investment options available inside many 457(b) plans that deserve a deeper look: FIT Secure Growth and FIT Select Income.
So now it’s time to unpack what those are and why they’re mentioned in the same breath as your new 457(b) plan. Despite their high-energy names, they’re not workout programs (no burpees or push-ups required). They are actually fixed-indexed annuities – a type of investment option offered within some retirement plans.
An annuity, in this context, is simply a contract that helps your money grow with some guarantees behind it. A fixed-indexed annuity (FIA) is a hybrid between a CD and a stock index fund. You get a guarantee that you won’t lose your principal (the money you put in) even if the stock market takes a tumble, and you’ll earn interest linked to the performance of a market index (like the S&P 500). In other words, you get protection when the market goes down and growth potential when the market goes up. It’s like having the best of both worlds: safety and growth1.
FIT Secure Growth and FIT Select Income are two FIA options provided by the plan’s insurer (likely through National Life Group, which offers these products) tailored for retirement savings. Here’s how they break down:
FIT Secure Growth – as the name implies, this option is focused on growing your savings securely over the long term. When you direct your 457(b) contributions into FIT Secure Growth, your money will earn interest based on an index’s performance, but with a floor of 0%. That means if the markets have a bad year, you won’t lose a dime – worst case, you just don’t gain for that period. In good years, your account gets credited with interest (subject to caps or participation rates set by the annuity) from the index gains.
The net effect? A smoother ride—no wild market swings, just a steady, predictable path forward (assuming you follow the rules and hold it long enough). It’s built for folks with a longer savings horizon—think 10 years or more—who want the peace of mind that comes with principal protection and a path to growth, without tying their future to the whims of the stock market.
It even allows relatively flexible contributions2 (you can start with as little as $100 a month or a $5,000 lump sum), making it accessible. Plus, there are some added perks at no cost – like penalty-free withdrawals2 for things like nursing care or terminal illness, and even an emergency access waiver if the plan permits. In short, FIT Secure Growth is the “slow and steady wins the race” option. You can rest easy knowing your balance won’t suddenly drop because of a market crash, giving you peace of mind while still aiming for growth above a plain savings account.
- Build retirement savings with zero risk of loss
- Participate in market gains without market risk
- Maintain flexibility with retirement withdrawals
- Start small with $100/month contributions
- Create a guaranteed retirement paycheck
- Eliminate the risk of outliving savings
- Get income bonuses up to 200%
- Have protection if disabled (Income Doubler)
FIT Select Income – this option is all about turning your savings into a reliable income stream when you retire. It’s also an indexed annuity, so it offers the same kind of principal protection and growth potential as Secure Growth, but with a twist: it comes with a built-in Guaranteed Lifetime Income rider. That means when you’re ready to retire, you can activate this feature and it will pay you a guaranteed amount every year (or month) for life – no matter how long you live or what the market does. Yes, you read that right: you could live to 100+ and still be getting checks, even if you’ve technically used up your initial account value. It’s like creating your own personal pension.
This is huge for those who worry about outliving their money. FIT Select Income is ideal if you want to put at least some of your 457(b) savings into “income mode” later on, effectively securing a paycheck for life. While you’re still saving, it works similarly to Secure Growth (indexed interest, no losses, some free withdrawal allowances), but its star feature shines at retirement when it can convert to lifetime income. Think of it as insurance against longevity – you won’t have to budget your withdrawals to avoid running out; the annuity guarantees it won’t run out.
| When You Activate Income | Max Bonus GLIR | Split Bonus GLIR |
|---|---|---|
| Years 2-5 | 115% | 100% (plus 5% immediate credit) |
| Years 6-10 | 125% | 110% (plus 5% immediate credit) |
| Years 11-15 | 145% | 125% (plus 5% immediate credit) |
| Years 16-20 | 170% | 145% (plus 5% immediate credit) |
| Years 21+ | 200% | 170% (plus 5% immediate credit) |
Now, these indexed annuities are offered within the 457(b) plan likely because they provide a level of security and predictability that complement riskier investments. You don’t have to choose them – you could stick with traditional mutual funds – but they’re a valuable option, especially if the stock market makes you nervous or you like the idea of guaranteed outcomes.
To sum up their advantages in a nutshell:
- No market risk – you can’t lose your money due to a market downturn; your principal is protected:contentReference[oaicite:16]{index=16}.
- Tax-deferred growth – just like other plan options, any interest credited grows without current taxes.
- Guaranteed outcomes – Secure Growth guarantees no losses (and locks in gains), Select Income can guarantee you an income for life. It's like having a safety net and a lifelong security blanket in one.
In non-bullet form: these indexed annuities give you growth with peace of mind. When the market is up, you get a piece of the action; when the market is down, you’re safely on the sidelines (and don’t lose a penny). Over time, you still grow your account balance , and you have the option to convert that balance into a guaranteed lifetime income stream when you retire. It’s a powerful combo.
While other investments might offer higher highs, they also come with lower lows – and as retirement nears, those lows can really hurt. Products like FIT Secure Growth and Select Income are designed to smooth that out and deliver a more predictable outcome, which many find worth the trade-off of not chasing the absolute highest returns.
One more subtle benefit: because these annuities protect your downside, they remove a lot of stress from investing. You don’t have to constantly check the market or fear the next recession wiping out your progress. That’s the “peace of mind” factor – and though it’s not a financial metric, it certainly has value.
In Conclusion
Today, with tools like pensions, 457(b) plans, and indexed annuities, you can work because you want to, not because you’re financially stuck. The goal is to retire not only with enough money to live but with the peace of mind that you won’t run out no matter how long you live or what happens in the markets. With a well-funded 457(b) and smart choices along the way, you’ll be on track to achieve just that.
With the addition of features like FIT Secure Growth and FIT Select Income in the plan, you can tailor your saving strategy to what makes you comfortable. Want steady, guaranteed growth? Check. Want a shot at lifetime income so you can’t outlive your money? Check. Prefer to mix and match and still keep some funds in more traditional stock or bond funds? You can do that too. It’s all about choice and customization. Not to mention, all these choices come wrapped in the friendly umbrella of tax deferral and no early withdrawal penalties after you leave the job.
If you’re unsure how to implement your own 457 plan, hit the button below. We’ll guide you through your options and help you determine if indexed annuities have a spot in your portfolio. And if you have any questions, feel free to reach out!
Resources:
