Athene Performance Elite 7 Review
Independent, Unbiased and Transparent
In this Athene Performance Elite 7 Review we will cover:
- Athene’s Financial Rating
- Type of Annuity
- Crediting Options
- Athene Performance Elite Rates
- Reasonable Rate of Return Expectations
- “Charge” Strategy
- Pros and Cons
- Final Thoughts
The Athene Performance Elite 7 is a 7 year fixed index annuity. Whenever we are reviewing an annuity or assisting our clients in the annuity shopping process the financial rating of the Issuing Insurance company is always on of the very first things we consider.
In this case we feel very confident in the financial strength of Athene and will judge this annuity purely on it’s own merit.
|Athene Financial Ratings||Rating|
|7700 Mills Civic Parkway, West Des Moines, IA 50266|
|A.M. Best Rating (15 possible ratings)||A (3)|
|Fitch Ratings (21 possible)||A (6)|
|Comdex (percentile of all rating companies)||78|
|Standard & Poor's (20 possible ratings)||A (6)|
As you saw in the table above table Athene is rated an A by AM Best, Fitch and Standard and Poor’s which definitely puts them in the solid category in my book.
In addition to considering the financial strength of a prospective insurance company I also give a lot of merit to how committed an insurance company is to the annuity market space when considering one of their products. I prefer to work with insurance companies who have a long, well established track record in the annuity business.
|2019 Rank||2018 Rank||2017 Rank||2016 Rank|
As you can see the in the above table Athene was number two three out of the last four years in total U.S. Fixed Indexed Annuity sales and they were number four the other year. With that being said we are very comfortable with Athene as a product manufacturer. So… With out further ado let’s jump in and review the Athene Performance Elite 7.
Athene Performance Elite 7 Reviewed
As we start to dive in I’d like to mention that this annuity review is simply that, an independent review. It is not a recommendation to purchase this annuity and this review has not been endorsed by Athene, nor are we being compensated or affiliated with them in any way.
The Athene Performance Elite 7 is a fixed indexed annuity with a 7 year contract term. One of the things we really like about the Performance Elite right off of the bat is that it has 5 different market indexes available. What is even better than the 5 available indexes is the fact that four of them have “Un-Capped Crediting Methods” options.
The four market indexes with uncapped crediting options are:
- BNP Paribas Multi Asset Diversified 5 Index
- Nasdaq FC Index
- AI Powered US Equity Index
- S&P 500 Daily Risk Control 2 8%™ Index TR (Total Return)
Athene Performance Elite 7 Rates
After researching the available indexes, and running hypothetical back tests for all of the caps, and participation rates for all 5 indexing strategies my two favorite indexing option are the Nasdaq FC Index and AiPex index with a participation rate. Here are very brief summaries of these two indexes:
The Nasdaq Fast Convergence Index is designed with the goal of improving participation rates in an index-linked product. By systematically monitoring market moves and rebalancing throughout the trading day, FC technology aims to more efficiently control the realized volatility of an index.
The AiPex Index is the first ever U.S. Equity Index Powered by artificial intelligence and uses the IBM Watson Brain. It scores the 1000 largest companies by analyzing millions of pieces of information per day to select the best 250 stocks.
Performance Elite 7 Reasonable Rate of Return Expectations
Let’s take a look at the historical rate of returns for these two indexing options. Again, hypothetical illustrations are not a guaranteed ran a hypothetical using both of these indexes and here are the average annual returns for the best, worst and most recent 10 year period. These rate of returns assume 50% allocated to the AiPex Performance Index and 50% allocated to the Nasdac FC Index using the annual point to point with participation rate strategy (rates as of 10.11.2020).
As you can see in the tables below the average annual interest rate credited would have been:
- 5.23% for the Most Recent 10 Year Period
- 5.71% for the Highest 10 Year Period
- 3.99% for the Lowest 10 Year Period
I also back tested these two options separately to see how these strategies performed individually. The Nasdaq FC index would have performance at an average annual rate of 5.68% over the last 10 years. The AiPex, the first ever A.I powered US Equity index showed an average annual rate of 4.78% over the same most recent 10 year period.
- Worst – 3.86%
- Best – 5.82%
- Most Recent – 5.67%
- Worst – 4.12%
- Best – 5.60%
- Most Recent – 4.78%
If you are considering an Athene Performance Elite for part of your retirement portfolio we’d love an opportunity to assist you in any way that we I can. To see a hypothetical back test using today’s rate rates and the index strategies you’d prefer you can call, email or message us through our contact page and we’d be happy to put that together for you.
Performance Elite "Charge" Rate Strategy
The “with charge” crediting options are most likely the more unique feature of the Performance Elite. It is an additional rider that you can purchase that increases your annual cap or participation and reduces your spread.
The 95 basis point fee equals $950 annually on a $100,000 account value. For this fee the participation rate on the Nasdaq FC Index increases to 105% and to 130% for the AiPex Performance Index.
The table below lists the most recent, lowest and highest 10 year average rate of returns assuming we placed 50% in Nasdaq FC and 50% in AiPex just as before.
- Most Recent 10 Year Period – 9.23% Average
- Highest 10 Year Period – 10.22% Average
- Lowest 10 Year Period – 7.08% Average
Pros and Cons of Athene Performance Elite 7
Performance Elite Pros:
- 5 Different Indexes to choose from
- Uncapped crediting options available on 4 of the indexes
- Annual point to point and two year point to point options available for diversification
- Innovative AiPex and Nasdaq FC Indexes
- Highly Rated and Experienced Issuing Company (Athene)
- Unique “with charge” option that allows you to purchase higher participation rates
- Above average Hypothetical Historical Rate of Returns
Performance Elite Cons:
- More complicated and obscure indexes and crediting strategies may seem confusing to clients and advisors alike which may hinder some from considering it.
Athene Performance Elite 7 Review: Final Thoughts
The Performance Elite 7 Year Fixed Index Annuity is as good as any we’ve reviewed in quite some time. I really, really like the market indexes that are available inside of this annuity. Three of which are proprietary to Athene and not available in any other product. The variety of indexes and crediting methods are also a big positive.
I like the ability to purchase a higher participation rate for a fee; that is something we have not seen on any other indexed annuities.
The historical rates of return are superior to almost all other indexed annuities in today’s interest rate environment. If your objective is safe accumulation I say the Performance Elite 7 definitely warrants consideration as part of your fixed income portfolio.
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This is an independent annuity product review , not a recommendation or solicitation to buy or sell an annuity. Athene has not endorsed this review in any fashion and we don’t receive any compensation it.
Be sure to do your own due diligence, we recommend consulting with a properly licensed professional regarding any questions you may have. Values shown are not guaranteed unless specifically stated otherwise.
Rates and annuity payout rates are subject to change. Actual values may be higher lower than the values shown. The illustration is not valid without all 18 pages and the statement of understanding.