Introduction
Fixed Index Annuities are contracts between the annuitant and an insurance company in which the insurance company promises to credit interest based on the performance of a certain stock market index. Fixed Index Annuities have an inbuilt capital protection feature, so your principal will remain safe even if the index goes down.
Annuities are complex products, and many advisors try to missell them without properly understanding the buyer’s needs. Thus, you must educate yourself on these products and not solely depend upon the annuity agent’s high-pressure sales pitch.
This article provides a comprehensive review of the Lincoln OptiBlend Advisory Fixed Indexed Annuity. The OptiBlend Advisory Annuity is a deferred, fixed-indexed annuity that may be a decent choice if you are seeking a straightforward indexed annuity focused on growth and the safety of your principal. This annuity features several promising indexing options that can potentially deliver better returns compared to similar products on the market. After conducting extensive research and due diligence, I present an in-depth and unbiased analysis of this plan.
The review of the Lincoln OptiBlend Advisory Fixed Indexed Annuity will be broken into multiple subcategories:
Product Description
Rates and Costs Associated with the Lincoln OptiBlend Advisory Fixed Indexed Annuity
Riders
What Makes This Product Stand Out?
What I Don’t Like
Company Details
Conclusion
Product Description - Lincoln OptiBlend Advisory Fixed Indexed Annuity
The Lincoln OptiBlend Advisory is a Fixed Indexed Annuity (FIA) plan that offers the annuitant (annuity investor) an opportunity to earn a market index-linked return without having to incur the risk of market downside. This is a suitable plan for people who are looking for a plain vanilla fixed indexed annuity (with no optional paid riders such as enhanced lifetime income, enhanced death benefit, etc.) and aim to grow and protect their retirement savings.
Let’s have a look at the high-level fine print of Lincoln OptiBlend Advisory Fixed Indexed Annuity, and then we will discuss each point in detail.
| Product Name | OptiBlend Advisory |
|---|---|
Issuing Company | Lincoln National Life Insurance Company |
AM Best Rating | A (3rd of 13 ratings) |
Withdrawal Charge Period(s) | 5 years |
Maximum Issue Age | 85 Years |
Minimum Initial Purchase Amount | $10,000 |
Surrender Charge Schedule | Varies for different tenure policies |
Crediting Period and Strategies | 1-year / 5-year point-to-point with participation rate, 1-year point-to-point with cap rate, 1-year spread rate, 1-year dual-trigger, 1-year performance triggered, and 1-year fixed with interest rate guaranteed |
Plan Types | IRA, Roth IRA, Nonqualified Account, SEP IRA, SIMPLE IRA, 401(a) |
Indexes | S&P 500 Index, S&P 500 5%/10% Daily Risk Control ER Index |
Free Withdrawals | 10% of the annuity’s Accumulated Value; per year |
Death Benefit | Upon the annuitant’s death, the beneficiary can either choose from (i) Account Value (Lumpsum) or (ii) Guaranteed Minimum Value *If death occurs after annuitization, payments will be consistent with the Settlement Option selected |
Riders | Free Nursing home and terminal illness waivers No optional paid riders |
Surrender Value | Greater of Account Value (less any withdrawal charges/MVA) and the Minimum Guaranteed Value |
How does the Lincoln OptiBlend Advisory Fixed Indexed Annuity policy work?
Any annuitant (maximum age at the time of policy issue: 85) can purchase the Lincoln Optiblend Advisory Fixed Indexed Annuity with a minimum initial purchase amount of $10,000, and in return, they will earn a part of market index returns (calculated through a formula that we will discuss shortly), credited as per the chosen crediting period. Apart from the regular crediting period, there are various events that may trigger earnings credit: On free withdrawals, for a long-term care event or terminal illness, or injury event, or when a death benefit is payable.
The Lincoln OptiBlend Advisory Fixed Indexed Annuity offers the annuitant the option to choose from one or more of the three indexes (S&P 500 Index, S&P 500 5% Daily Risk ER, and S&P 500 10% Daily Risk ER Index) to determine their earnings crediting formula. The S&P 500 index has five strategies, the S&P 500 10% Daily Risk Control ER index has three strategies, and the S&P 500 5% Daily Risk Control ER Index has one strategy. The annuity also offers a fixed-rate guaranteed interest strategy to choose from, making a total of 10 strategy options. We will discuss each available index briefly:
S&P 500 Index: The S&P 500 index is one of the most popular and oldest indexes in the world. It tracks 500 large-cap publicly traded stocks listed in the United States, serving as a barometer for the overall U.S. equity market. It is a reliable index and has often succeeded in the test of time.
S&P 500 10% Daily Risk Control ER Index: The S&P 500 10 % Daily Risk Control Excess Return Index is designed to give a smoother ride than the regular S&P 500. It's built-in rule targets about 10 % annual volatility, trimming stock exposure when markets become jumpy and parking the difference in short-term cash, or adding extra exposure when conditions are calm. Because part of the portfolio may sit in cash and the index subtracts the cost of any borrowing, it usually lags the plain S&P 500 during strong rallies, yet it cushions losses in steep declines.
S&P 500 5% Daily Risk Control ER Index: The S&P 500 5% Daily Risk Control Excess Return Index is an even steadier take on the S&P 500, aiming to keep its annualised volatility near 5%. Each day, it automatically scales the amount of stock it holds: when markets get shaky, it cuts equity exposure (moving the rest into short-term cash), and when conditions calm down, it can boost exposure. Because part of the portfolio may sit in cash and the index subtracts a small financing cost, it generally lags the plain S&P 500 during big rallies but softens the blow in sharp downturns, delivering a smoother path.
Out of the indexes offered by this plan, the wisest decision is to choose the plain S&P 500-based indexing strategies because of the index’s transparency, long-term record of solid returns, and global importance. The other two indexes are risk-controlled excess-return indexes that keep volatility low, meaning they limit both upside and downside. But in a fixed indexed annuity, your principal is already protected, so sacrificing potential upside offers little benefit.
It's important to understand that, like all fixed indexed annuities, the crediting strategies associated with the OptiBlend Advisory Fixed Indexed Annuity come with cap rates, participation rates, performance triggers, etc., meaning that you will be credited only a part of the index return to your annuity. These rates change frequently; I will discuss more on these rates more shortly.
Note: In addition to allocating the funds in the following indexes, the annuitant also has the option to allocate funds at a fixed interest. The 1st year fixed rate for the 5-year withdrawal charge period at the time of writing this article was 5.00%. It is noteworthy that the fixed rates offered by Lincoln Optiblend Advisory FIA are among the highest when we compare them with other annuities. You can view the latest rates of this annuity here.
Rates and Costs associated with the Lincoln OptiBlend Advisory Fixed Indexed Annuity
The earnings crediting formula
The earnings crediting formula is the most important part of this annuity discussion. It is important to know that we don’t simply get the index return credited to our annuity. There are a few rate limitations (in the form of cap rates, participation rates, trigger rates, and other rates) that the company has in place that affect our earnings. These rates tend to change over time, and the updated rates can always be checked on the company’s website or with your trusted financial advisor.
Let’s have a look at the Lincoln OptiBlend Advisory rate sheet (as of August 2025) to understand how the earnings are determined.
.png&w=1200&q=100)
The table above shows that the annuitant can choose from three underlying indexes - S&P 500 Index, S&P 500 10% Risk Control Index, and S&P 500 5% Risk Control Index, offering a total of 10 crediting options (9 index-based and 1 fixed). These options include a variety of crediting strategies such as participation rate, spread, performance trigger, and cap rate structures. Additionally, there is an option to allocate funds to a fixed account with a declared interest rate. As an annuitant, you can allocate your premium to one or more of these crediting strategies.
Let’s now explore how each of these crediting strategies works.
Participation Rate: Participation rate describes the annuitant’s participation percentage in the return of an index. For example, suppose the participation rate is 150%, and the index returned 4% over the agreed time. In that case, the annuitant will be eligible for 150% of the return, i.e., 6%. The company offers a generous participation rate on the S&P 500 10% Daily Risk Control Index because the underlying index itself is built in such a way that it limits its return earning potential. If I were at your place, I would skip the S&P 500 Daily Risk Control ER Index for all its strategies.
Cap Rates: This refers to the rate at which your interest-earning capacity is capped. For example, if an index returns 12% but the contract’s cap rate is 6%, the annuitant will be eligible for an interest credit of 6% only. It doesn’t matter how much the index goes above the cap rate; the maximum interest that can be earned is the cap rate. It is noteworthy that the company offers a relatively good cap rate (9.00%) for the S&P 500 Index when compared to other similar policies.
Performance Trigger Option with Declared Rate: A flat or positive index return triggers the declared interest rate to be credited to the contract value. If the index return is negative, no interest is credited, but there will be no loss, and the contract value will remain the same. The declared interest rate is set at contract issue and applies for the 1-year indexed term. In this case, the performance-triggered rate for the S&P 500 Index is 8.50%. It means that if the S&P 500 Index doesn’t go negative for a given 1-year period (even if the growth is 0% and not negative), the interest credited will be 8.50% irrespective of the S&P 500's actual return. It is noteworthy that the company offers a good performance triggered rate for the S&P 500 Index when compared to other similar policies.
Dual Trigger: At the end of the one-year indexed term, if the index has a positive change or remains flat, your account is credited with the trigger rate. If the index change is negative but less than the value of the trigger rate, the difference is credited. If the index is negative by the value of the trigger rate or more, your account is protected from loss, but no interest will be credited. At first glance, this appears to be a more logical choice than selecting the Performance-Triggered index option; however, the trade-off is a lower trigger rate compared to the Performance-Triggered option (8.00% vs 8.50%).
Spread: The amount of interest that the Company will credit is based on a declared spread on the selected index on an annual point-to-point basis. Once the index gain is determined (if any), the spread amount is subtracted. The remaining amount is credited to the contract for that term. In this case, the company offers a spread option with a very low spread rate (which is good), but it should be noted that the underlying index(s) for the same are not the S&P 500 but the S&P 500 with Daily Risk Control Index. As discussed above, the daily risk adjustment (5% and 10% in this case) in the index limits its true return earning potential and thus should not be confused with the regular S&P 500 Index.
Fixed Account Rate/Declared Rate: If you opt for a fixed account rate, you simply earn the fixed rate for a particular period specified by the company before your policy begins. These rates usually tend to be very low as compared to other fixed avenues, such as CDs and MYGAs, so you should avoid fixed rates in a general scenario. The 1-year fixed rate on this policy at the time of writing this article was 5.00%.
I believe that, at the current time, opting for the 1-Year S&P 500 Performance Triggered strategy, the Dual-Trigger option, and the 1-Year S&P 500 with Caps offers the most compelling value. These strategies provide a strong balance of growth potential and downside protection. Additionally, allocating a portion of your premium to the fixed account could be a smart move, given the relatively high fixed rates being offered. For both the S&P 500-based strategies and the fixed account, the rates currently offered by the company appear competitive when compared to peers.
Surrender/Early Withdrawal Charge
Each year, you are allowed a 10% free withdrawal of your contract value without incurring charges, fees, or penalties.
Should your needs change unexpectedly, and you need to take an excess withdrawal (a withdrawal that is above the free withdrawal amount available in a given contract year), you may be entitled to access additional monies, although certain charges and penalties may apply. Any amount withdrawn in excess of the remaining free withdrawal amount is subject to a Surrender Charge. Below is the Surrender Charge schedule for the Lincoln OptiBlend Advisory Fixed Indexed Annuity.
| Completed Contract Years | 1 | 2 | 3 | 4 | 5 | 6+ |
|---|---|---|---|---|---|---|
Surrender Charge % | 7% | 6% | 5% | 4% | 3% | 0% |
Surrender Charge % (in CA) | 8% | 7% | 6% | 5% | 4% | 0% |
Market Value Adjustments - In case you need to surrender your policy, a Market Value Adjustment (MVA) will be applied to the portion of the withdrawal or surrender that exceeds the free withdrawal amount during the withdrawal charge period. The surrender charge schedule is different for the different tenures of annuities and also changes for some states. For a quick comparison of surrender charges across different Lincoln products, you may visit their annuities product page here.
The surrender charge of Lincoln OptiBlend Advisory Fixed Indexed Annuity is in line with all the other annuity issuers.
Note: You may only purchase a Lincoln Optiblend Advisory Fixed Indexed Annuity if you are a participant in an account established under a fee-based program that is sponsored and maintained by a broker/dealer or other financial intermediary approved by Lincoln Financial Group.
Contract/Administrative Charge
The Lincoln OptiBlend Advisory Fixed Indexed Annuity levies no annual contract or administrative fees
Riders
The Lincoln OptiBlend Advisory is a plain-vanilla annuity that does not offer any optional paid riders. In my opinion, this actually appeals to many people who don’t understand or do not want to dive deep into the complex methodologies the riders often come up with. However, as with most annuities, the OptiBlend FIA has free in-built nursing home and terminal illness waivers.
Nursing Home Waiver: After the first contract year, an annuitant can withdraw up to 100% of the contract’s accumulated value if he is confined to a Qualified nursing home for at least 90 consecutive days. No withdrawal charge or MVA applies if the owner qualifies for this benefit. Diagnosis must occur after the contract is issued, and written proof with supporting documentation is required from a qualified physician.
Terminal Illness Waiver: After the first contract year, an annuitant can withdraw up to 100% of the contract’s accumulated value if he is diagnosed with a terminal illness with a prognosis of 12 months or less. No withdrawal charge or MVA applies if the owner qualifies for this benefit. Diagnosis must occur after the contract is issued, and written proof with supporting documentation is required from a qualified physician.
What Makes This Product Stand Out?
The Lincoln OptiBlend Advisory Fixed Indexed Annuity offers some features that not many fixed-indexed annuities offer. The ones that I like the most are
The plan offers the S&P Index with multiple crediting strategies
Higher Caps, Participation Rates, and Fixed Rate: The OptiBlend Advisory Fixed Indexed Annuity provides higher rates, even for a very popular index like the S&P 500.
No annual contract, mortality & expense, or administrative fees
Free Confinement and Terminal Illness Waiver Benefit: This no-fee rider is automatically included for owners under age 65 and includes both a Qualified Nursing Care and Terminal Illness Benefit.
Multiple Payout Options: Lump sum or Annuitization option with Life Only, Life with Period Certain, Joint and Survivor Life, etc.
What I don’t like
This product is generally good on all fronts for people looking for growth; still, there are some features that could add more value for the annuitant. Some of the features that I don’t like about the policy are
There are no optional riders to choose from
Although the annuity offers good strategies on the S&P 500 Index, I don’t like the other index that the company offers for the interest crediting strategy.
Company Details
You must always keep in mind that, unlike CDs, annuities are not guaranteed by the Federal Deposit Insurance Corporation (FDIC) or any other federal insurance agency. An annuity's "guarantee" is only as strong as the insurance company that issues the annuity, so it is always important to assess the issuing company before buying an annuity.
Lincoln National Life Insurance Company
Lincoln National Life Insurance Company has been in the business since 1905. It is one of the largest and oldest providers of fixed and fixed indexed annuities in the US and has been regularly in the top ten Fixed Indexed Annuity Sales.
It is rated as follows by the rating agencies:
| Rating Agency | Rating |
|---|---|
AM Best | A (3rd of 13 ratings) |
S&P | A+ (5th of 21 ratings) |
Fitch Ratings | A+ (5th of 19 ratings) |
Moody's Investors Service | A2 (6th of 21 ratings) |
Lincoln National Life Insurance Company has managed to maintain decent ratings for many years. It is considered to be strong and stable financially. In 2024, the company paid out nearly $7.9 billion in claims and benefits. As of year-end 2024, some of the other financial highlights for Lincoln National Life Insurance Company include its:
$18.44 billion in total sales / direct written premium
$8.26 billion of stockholders’ equity
$1.7 billion in comprehensive income
$390.8 billion in total assets
Thus, going by the operating history and financial numbers, we can safely gauge that you can trust your savings with Lincoln National Life Insurance Company.
Conclusion
With the advancements in healthcare and technology, the average American today lives longer than ever. So, it’s very important to have a retirement corpus that can grow safely and steadily and have the ability to provide a fixed stream of income during the retirement years. This not only helps you mitigate the risk of outliving your income but also ensures that you continue to live a decent life even in your retirement.
The Lincoln OptiBlend Advisory FIA helps you grow your retirement account with much less risk. Through its higher caps, participation rates, and performance-trigger rates, it offers faster growth with principal protection. The product’s plain vanilla nature (with no optional paid riders) might also appeal to people who don’t like to deep-dive into the complex methodologies often associated with the riders. If you are considering buying a straightforward Fixed Indexed Annuity that is purely growth-oriented, the Lincoln OptiBlend Advisory FIA may be a decent product to look at.
We understand that choosing the right annuity can be a complex decision, influenced by a myriad of factors such as market conditions, individual financial goals, and evolving life circumstances. To better serve you in this critical decision-making process, we regularly conduct in-depth reviews of various annuity products, examining features, costs, and potential benefits. To delve deeper into our extensive reviews, click here.