• Overview
• Key Features
• Interest Options
• Decision Guide
• Value to You
• Q&A

TOOLS

• Questions & Answers
• Retirement Research
• For Employers
• Glossary of Terms
• About Us
• Contact Us
• Links

Interest Options

Fixed Account Option

This choice offers a fixed interest rate and a predictable account balance at year’s end. It may be ideal for you if you want assurance that your account will be credited a known amount of interest totally unrelated to the ups and downs of the S&P 500 Index.

Index Cap Option

• May be suitable for those who believe the S&P 500 will experience moderate performance.
• Interest credited equals 100% of the annual performance of the S&P 500 up to a maximum amount, referred to as the cap; the cap is set annually by Nationwide®.

Index Participation Option

• May be suitable for those who prefer an uncapped upside potential and believe the S&P 500 will experience strong performance.
• Interest credited equals a percentage of the performance of the S&P 500; this percentage is referred to as the participation rate and is set annually by Nationwide®. This rate is declared on the index interest crediting date, which is the end of the calendar month immediately following your contract anniversary.

How do the index options compare?

The chart below compares how the interest credited by each index option might work using different hypothetical levels of the S&P 500, assuming a cap of 8% and a participation rate of 60%.

The above hypothetical table is designed to demonstrate the mathematical principle behind both the Index Cap Option and the Index Participation Option. This table does not reflect an actual purchase. Individual results will vary based on the various caps, participation rates and S&P Returns.

Timing of interest credits

Interest in the Fixed Account Option is credited daily. Interest credits in the Index Cap Option and the Index Participation Option are credited once a year on the annual crediting date. If you withdraw funds from these two index accounts before their annual interest crediting date, you will receive no index interest on the amount withdrawn.

Please note, the contract does not directly participate in any stock or equity investments; that withdrawals or surrenders prior to the expiration of an index period will result in no index participation for such amounts and that failure to maintain the contract to maturity may result in no participation in the equity index. It is also important to understand that actual returns may be less than the return of the linked index. And, possibly even negative if part, or all, of the contract is surrendered prior to the expiration of any applicable surrender period.

Federal tax laws are complex and subject to change. The information in this website is based on current interpretation of the law. Neither the company nor its representatives give legal or tax advice. Please consult your attorney or tax advisor for answers to your tax questions.

If you take your money out early, you may face early withdrawal fees. If you’re not yet 59½, you may also have to pay an additional 10% income tax penalty on top of ordinary income taxes. Naturally, if you do take an early withdrawal, your death benefit and cash value will be reduced.

» Continue to “Decision Guide” Section